Pricing a used car at the pawn counter: which comparables matter
Short answer: compare a car only with real sales of the same make and model, with the same fuel, a year within one of it and a mileage within about 30 percent. Fewer than three such sales means the price is uncertain; none means the car needs a manual valuation.
The five things that move a car's price most
- Make and model. The starting point. A Dacia Logan and a Volkswagen Golf are different markets.
- Fuel. Petrol, diesel, hybrid and electric versions of the same model sell at different prices.
- Year. Each year of age changes the price, so compare within one year either side.
- Kilometres. Mileage within about 30 percent keeps wear comparable.
- Condition and history. Accidents, service history and documents can override everything else, and they need a person to check them.
Why the window is narrow
A wider window finds more sales but mixes cars that are not alike. A 2015 diesel with 250,000 km tells you little about a 2019 petrol with 60,000 km. A narrow window with few sales is more honest than a wide one full of the wrong cars.
Real sales, not listings
As with electronics, car listings show asking prices. A lending decision should rest on what comparable cars actually sold for, ideally at pawn shops, where the buyer and the timing are the same as yours.
When there is no price
Rare models, unusual engines or very high mileage often have no comparables. The right answer then is no automatic price and a manual valuation, not a number stretched from cars that are not comparable.
How PawnMeter does it
The clerk enters make and model, year, kilometres and fuel. PawnMeter looks for real sales in the last 12 months that match on make, model and fuel, with the year within one and the kilometres within 30 percent, and shows the median, the range and the sales behind it, or says there is no price.
PawnMeter: Type the item. PawnMeter shows the resale price and a suggested loan, calculated only from what comparable items really sold for. When there is not enough data, it says so instead of guessing.
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