There are many factors that determine the value of a used car.

Age is one of the most significant, along with condition, maintenance history, colour and specification, and whether a newer version has arrived in showrooms.

However, without question, one of the most powerful drivers is mileage, with a less-used car likely to worth more than one that's clocked up the journeys.

But what's the mileage point when a car's value declines most? 

New analysis by vehicle sales platform Carwow claims to have identified the major threshold at which thousands of pounds can roll off a used car - and how hitting certain brackets influences depreciation.

The findings suggest drivers wanting to determine the best time to replace a car need to be aware of one particular milestone.

Carwow reviewed vehicle value data from used car sale prices achieved on its platform between 2022 to 2024.

While any car's value instantly drops as soon as it is driven off a forecourt, Carwow's data revealed it takes the first monumental hit once the odometer ticks past 10,000 miles - dropping by 22 per cent.

However, the largest percentage loss comes when a car surpasses 20,000 miles, dropping by an average of 24 per cent compared to the value at 10,000 miles.

Beyond this point, every additional 10,000 miles results in a further 17 to 18 per cent decline in value, making mileage one of the most critical factors in determining a car’s worth. 

Once a car surpasses 60,000 miles, its value has dropped by an average of 64 per cent, the study found.

The next major fall comes when the odometer reading reaches six figures.

Moving from 100,000 to 110,000 miles sees value drop by a further 19 per cent – an average loss of £879 by that point.

What's average mileage?

Data from the Department for Transport reveals that the majority of British drivers cover between 5,000 and 7,000 miles per year.

Average mileage has dropped significantly compared to pre-pandemic, with hybrid working and work-from-home contracts becoming more prevalent and dramatically reducing national commuting mileage.  

As such, there's a far greater possibility of cars taking more years to reach 20,000 miles than before the Covid-19 outbreak. 

Car owners looking to trade in are therefore best advised to pay attention to their odometers, as they could stand to get more money back in their pockets by changing vehicles before the next 10,000 miles threshold is met.

'Our data highlights just how important it is to keep a keen eye on your mileage. Car owners wanting to sell their old cars should act quickly, as waiting could lead to a substantial drop in valuation price, especially if your car tips into another mileage bracket,' explains Carwow's Ian Reid.

'There are many factors that affect a car’s valuation, such as the model and any modifications that have been made. 

'However, mileage is one of the key factors that, regardless of model differences, will always have a big impact.'

EVs and hybrids depreciate slower per mile

One surprising finding from the study is that petrol cars are losing value fastest, while electric vehicles are bucking the trend.

By 30,000 miles, the average petrol car has lost 38 per cent of its value, while EVs have only dropped 26 per cent, according to the report.

And hybrids perform even better, with just 11 per cent depreciation in the same period.

'Specifically, EV brands like Tesla and Polestar are proving to be strong long-term performers, offering some of the lowest depreciation rates in the market,' Carwow claimed.

An exclusive report by This is Money in association with valuations experts at cap hpi last year showed that EVs typically shed the majority of residual value in the first year - or after 10,000 miles.

Thereafter, depreciation is similar to that of a combustion-engined alternative.

In all cases we examined - pitching an EV to its closest combustion equivalent from the same brand - the battery model's value had fallen below that of a year-old petrol/hybrid alternative, despite the latter having a far higher new price.

Thereafter, the year-on-year depreciation is generally at the same rate, meaning EVs will match their combustion counterparts and won't continue to dramatically fall in price over the following years.

With the vast majority of new EV registrations being fleet purchases - many of which are private buyers utilising salary sacrifice schemes through their employees - it means there are very few who will suffer the first-year depreciation seen here.

By the time fleet contracts end and these models enter the used market, second-hand car buyers can ultimately get better value for money by opting for an EV - granted they have the provisions to charge one at home.

Most car manufacturers offer warranties on EV batteries for eight years (or up to 100,000 miles), meaning extra piece of mind for those considering a second-hand model.

Dylan Setterfield, head of forecast strategy at cap hpi who ran the data for This is Money, says: 'Surveys of used car buyers still reveal the price of EVs as being one of the main reasons why drivers are not switching to electric.

'What many don’t realise is, that not only are the vast majority of models cheaper than petrol or diesel equivalents, and sometimes by thousands of pounds.

'There is also a significant cost of ownership saving in terms of running costs, especially, but not exclusively, if drivers are able to charge at home.

'Prices have already come down so far that many models look fantastic value for money, and while this has stimulated demand for those in the know, the majority of used car buyers are completely unaware of the thousands of pounds they could be saving themselves.'