In the first year of ownership, a Lexus will generally lose 24.2% of its value. Five-year depreciation rates average around 53.5%.
You know the old saying—your brand-new car loses value as soon as you drive it off the lot. That’s definitely true for Lexus vehicles, even though the brand has a higher-than-average resale value. Knowing a car’s value over time is useful if you decide to buy used or sell your old ride, and can tell you a lot about a brand’s reliability.
When it comes to Lexus vehicles, the depreciation rate is relatively low, especially for a luxury brand. Here to help you navigate the ins and outs of Lexus depreciation rates is Jerry, the trusted car insurance broker app. We’ll talk about how depreciation works and look at some of Lexus’ most popular vehicles and their depreciation rates—plus, we’ll provide a way to save on your Lexus insurance costs!
Does a Lexus hold its value?
Lexus has one of the lowest depreciation rates in the luxury segment. Don’t just take our word for it—Kelley Blue Book awarded Lexus the 2022 ribbon for Best Resale Value: Luxury Brand. This was the third time the brand was chosen for this distinction!
The Lexus IS was also recognized as having the best resale value for an entry-level luxury car while the Lexus LX got the top spot in the luxury full-size SUV segment. Some other worthy mentions include the Lexus RC and the Lexus GS.
What does “depreciation” mean?
A car loses value over time, which is basically the rate that depreciation measures. Depreciation shows you the difference between the original sticker price you paid for your car and what it’s currently worth. Here are a few factors that help determine your car’s depreciation rate:
- Purchase price
- Mileage
- Ownership history
- Condition
You can expect the average vehicle to lose around 40% of its value in the first five years, with 20% lost in the first year of ownership. Calculating depreciation for an individual vehicle may provide slightly different estimates from what’s expected from the model.
Depreciation will hit a lot harder if your car is in an accident, doesn’t receive regular maintenance, or has a lot of miles on it. However, a Lexus will depreciate slower than average, as it’s a brand known for holding its value better over time.
It’s important to factor in depreciation when you’re determining the true cost of ownership for a vehicle. Whether you’re in the market for a brand-new Lexus or a used model, taking depreciation into account—along with insurance, maintenance, and repair costs—will give you a better idea of how much you should budget to get the most out of your luxury vehicle.
Do Lexuses depreciate faster than other luxury vehicles?
Not at all! In fact, Lexus is at the top of the list when it comes to holding value, along with its parent company Toyota. Trucks like the Toyota Tacoma and Tundra have some of the lowest depreciation rates out there!
Lexus beats out the competition when it comes to luxury cars, like the Audi A6 and Mercedes-Benz E-Class, which lose about 69% of their value in five years. Still, there are outliers, like the Porsche 911 (which only loses 12.8% of its value over five years!), that beat out Lexus in terms of depreciation.
Lexus depreciation rates
We’ve put together the average one-year, three-year, and five-year depreciation rates for the most popular recent Lexus models, based on data from Edmunds.
These estimates use 15,000 miles of annual use as a standard and assume that a regular maintenance schedule is followed. The residual value shown for each model is based on the purchase price shown in the top row of each table (estimated for the 2022 base model unless otherwise stated). Keep in mind that these are only estimated values—the actual resale value of your vehicle will vary based on the model year, MSRP, trim level, mileage, and condition.
Lexus IS depreciation
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $90,584 |
| 1 | 27.8% | $65,364 |
| 3 | 44.5% | $50,284 |
| 5 | 60.2% | $36,043 |
Lexus RX depreciation
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $56,132 |
| 1 | 20.3% | $44,731 |
| 3 | 33.4% | $37,340 |
| 5 | 45.9% | $30,359 |
Lexus GS depreciation (2020)
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $55,473 |
| 1 | 30.3% | $38,691 |
| 3 | 44.4% | $30,845 |
| 5 | 57.7% | $23,438 |
Lexus NX depreciation (2021)
| Years old | Depreciation rate | |
|---|---|---|
| 0 | 0% | $43,294 |
| 1 | 26.8% | $31,698 |
| 3 | 37.9% | $26,878 |
| 5 | 48.4% | $22,328 |
Lexus LS depreciation
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $90,584 |
| 1 | 27.8% | $65,364 |
| 3 | 44.5% | $50,284 |
| 5 | 60.2% | $36,043 |
Lexus LX depreciation
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $102,998 |
| 1 | 24.3% | $77,928 |
| 3 | 38.9% | $62,944 |
| 5 | 52.6% | $48,801 |
Lexus CT depreciation (2017)
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $102,998 |
| 1 | 24.3% | $77,928 |
| 3 | 38.9% | $62,944 |
| 5 | 52.6% | $48,801 |
Lexus ES depreciation (2020)
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $37,146 |
| 1 | 17.7% | $30,583 |
| 3 | 36.9% | $23,428 |
| 5 | 52.1% | $17,798 |
Lexus GX depreciation
| Years old | Depreciation rate | Residual value |
|---|---|---|
| 0 | 0% | $63,469 |
| 1 | 17.3% | $52,482 |
| 3 | 33.4% | $42,270 |
| 5 | 48.6% | $32,620 |
How to find out how much your Lexus has depreciated
The practical value of knowing your car’s depreciation rate is worth the work of calculating it. Whether you’re trying to figure out the difference between your loan balance and the car’s value or you want to know if it’s worth investing in extra insurance coverage, your Lexus’ current value is a valuable asset.
To get an idea of how much your car is worth, find its current fair market value and subtract it from how much you originally paid for it. This will show you the value your vehicle has lost in the time you’ve owned it.
Online experts like Kelley Blue Book and Edmunds have online calculators to help determine your Lexus’ depreciation rate, but for a more definite estimate, you can have a dealership or car market expert evaluate it.
How to limit Lexus depreciation
Even though depreciation is a normal part of car ownership, it’s still a bummer that a fair chunk of what you paid for your Lexus disappears over time. But there are a few things you can do to keep your car’s depreciation rate under control.
To keep your Lexus at its highest possible value, follow these suggestions:
- Storage: Weather can really wear on your Lexus. Keep your car parked in a garage or covered area as much as possible.
- Mileage: The estimated depreciation rates listed above are based on a mileage of 15,000 miles per year. Keeping your mileage low can keep the depreciation rate lower as well!
- Maintenance: From oil changes to waxing your car, keeping up with a regular maintenance schedule can keep your Lexus running like new!
- Color: A car’s exterior paint job can increase its value! Grayscale colors, like white, black, and silver, tend to maintain higher resale value.
Why you should buy gap insurance for your Lexus
As a luxury brand, Lexus cars represent a major investment. To protect your investment and make sure you get the most value from your vehicle in the case of an accident, gap insurance is a smart add-on to your insurance policy.
Gap insurance stands for “Guaranteed Asset Protection” and it covers the difference between what you owe on your auto loan and the actual cash value (ACV) payout (minus your collision deductible) from your insurance provider if you total your car before the loan is paid off.
Since new cars have higher depreciation rates, it’s likely that you’ll owe more on your loan than your car’s actual value for the first couple of years.
Most providers will pay up to the ACV of your car if it’s written off. Your insurance provider determines the ACV by calculating your vehicle’s replacement cost minus depreciation.
Gap insurance covers non-accident-related damage, too. If your Lexus is stolen or totaled by a different covered peril, such as extreme weather, gap insurance will come into play if you have comprehensive coverage. However, you will still be responsible for your collision or comprehensive deductible if applicable.
How to save on Lexus insurance
With depreciation, car repairs, and car insurance, the ownership costs for your Lexus can add up fast. But with Jerry, the trusted insurance broker, you can cut down your car insurance costs in less than a minute.
Jerry can tell you if you’re overpaying for your Lexus insurance and set you up with a new low rate. Just download Jerry’s easy-to-use app, answer a couple of questions, and get access to custom rates from Jerry’s 55+ insurance provider partners! Plus, if your vehicle is financed and you have insurance through Jerry, you may also be eligible for an auto loan refinance, which could lower your interest rate or monthly payment.
Brittni Brinn is an insurance writer with experience in a variety of industries. Her writing for Jerry covers a broad range of auto and insurance-related topics, all aimed at helping car owners cut down on expenses and make smart decisions. Brittni has authored nearly 600 articles for the Jerry team on topics ranging from tips on how long to keep your insurance records to first-time car buyer programs. When she’s not writing for Jerry, Brittni is hard at work writing for radio, theater, and film. Brittni has also penned and published two novels with Adventure World Press.
