Things That Depreciate in Value the Most

Most purchases lose value over time, but some depreciate much faster than others. Whether due to technological advancements, wear and tear, or shifting demand, certain products see their worth plummet soon after purchase. Recognizing these trends can help consumers make smarter financial decisions.

Vehicles

Few purchases lose value as quickly as automobiles, which begin depreciating the moment they leave the dealership. A new car typically loses 20% to 30% of its value in the first year alone. By the fifth year, most vehicles retain only about 40% of their original price. Luxury models often experience steeper declines due to high maintenance costs and rapid technological obsolescence, while economy cars with strong reliability records hold their worth better.

Depreciation rates vary based on brand reputation, mileage, and market demand. Vehicles from manufacturers known for durability, such as Toyota and Honda, depreciate slower than brands with higher repair costs or lower resale demand. Electric vehicles (EVs) have historically lost value quickly due to concerns over battery longevity and evolving technology, though federal tax credits and expanding charging infrastructure have recently stabilized their resale values.

Leasing can reduce the financial impact of depreciation, as monthly payments are based on the expected loss in value. However, leasing comes with mileage restrictions and potential fees for excessive wear. For those buying outright, certified pre-owned vehicles offer significant savings while avoiding the steepest depreciation hit.

Consumer Electronics

Technology evolves rapidly, making consumer electronics one of the fastest-depreciating purchases. Smartphones, laptops, and gaming consoles lose value quickly as newer models with upgraded features replace them. Flagship smartphones from brands like Apple and Samsung typically lose 40% to 60% of their original price within a year.

The secondary market is flooded with used devices, further driving down prices. High-end laptops, such as the MacBook Pro or Dell XPS series, retain some value due to brand loyalty and professional demand, but even these models depreciate as software requirements increase and hardware limitations emerge. Budget-friendly electronics experience even steeper declines, as their lower initial cost leaves little room for resale value.

Gaming hardware follows a similar pattern. Consoles like the PlayStation and Xbox lose resale appeal as soon as next-generation systems are announced. Accessories such as VR headsets and controllers also depreciate quickly, especially when newer models introduce compatibility issues. Televisions, once considered long-term investments, now lose value rapidly as advancements in display technology—such as OLED, Mini-LED, and 8K resolution—make older models obsolete.

Luxury Apparel

Designer clothing, handbags, and footwear often carry high price tags but rarely retain their value. Unlike fine jewelry or watches, which may appreciate based on material value and craftsmanship, most luxury garments lose a significant portion of their worth once worn. Limited-edition collaborations and exclusive runway pieces can hold value if demand remains high, but mass-produced designer collections suffer from oversaturation, making resale prices unpredictable.

Brand perception plays a major role in depreciation. Labels that maintain exclusivity, such as Hermès and Chanel, see stronger resale values, particularly for iconic handbags like the Birkin or Classic Flap. In contrast, brands that frequently offer discounts or expand into lower-tier markets struggle with long-term value retention. Fast-moving fashion cycles also accelerate depreciation, as collections become outdated within months.

Furniture

Most furniture depreciates quickly due to personal preference, supply chain dynamics, and durability concerns. While high-end pieces from renowned designers or antique collections may hold value, mass-produced furniture loses a significant portion of its resale price almost immediately. Retail markups, sometimes exceeding 200%, create an illusion of lasting worth, but once an item leaves the showroom, its market price drops sharply.

Material quality plays a major role in depreciation. Solid wood furniture, particularly pieces crafted from hardwoods like oak, cherry, or walnut, retains value better than particleboard or MDF alternatives, which degrade quickly. Upholstered items, such as sofas and mattresses, face even steeper declines due to wear, hygiene concerns, and shifting interior design trends.

Market saturation further accelerates depreciation. Major retailers like IKEA, Ashley Furniture, and Wayfair produce furniture at scale, ensuring a constant supply of affordable new options that diminish demand for used items. Custom or handcrafted pieces may fare slightly better, but even these struggle against evolving tastes and space constraints.

Household Appliances

Large home appliances, such as refrigerators, washing machines, and ovens, lose value quickly due to frequent design updates, efficiency improvements, and inevitable wear. Unlike furniture, which may retain some aesthetic appeal, appliances are valued primarily for their functionality. Once used, potential buyers often worry about hidden mechanical issues, reducing resale demand. Even high-end brands like Sub-Zero or Miele depreciate as newer models with advanced energy-saving features and smart technology enter the market.

Warranty coverage also affects resale value. Many manufacturers offer limited warranties that do not transfer to secondhand buyers, making used appliances a riskier purchase. Additionally, repair costs can sometimes exceed the price of buying a new unit, further discouraging resale. Retailers frequently offer discounts on floor models and open-box items, making brand-new purchases more appealing than secondhand options.

Timeshares

Timeshares are among the worst financial investments in terms of depreciation, often losing nearly all resale value within a short period. Unlike traditional real estate, which can appreciate based on location and market trends, timeshares are structured to benefit developers more than buyers. High maintenance fees, limited flexibility, and an oversaturated resale market make them difficult to sell, with many owners resorting to giving them away just to escape ongoing costs.

The secondary market for timeshares is notoriously weak, with resale prices often falling to pennies on the dollar. Many buyers are unaware of the long-term financial commitment involved, including annual maintenance fees that can rise unpredictably. Companies specializing in timeshare exit strategies have emerged, but these services often come with high fees and no guarantee of success. Unlike vacation properties, which can be rented out for income, most timeshare agreements restrict owner flexibility, further reducing their appeal.