How Accurate Are NADA RV Values? Our readers often ask us about the trade-in value and private party value of certain cars, SUVs, and RVs. Particularly trying to understand why the pricing is so different between what offers by a dealership and a private buyer. So, a common question from our readers is, “Why Is NADA Value So Low”. Or, more specifically, “Why is NADA so much lower than KBB?”, “Are NADA RV Values Accurate?”, “Is NADA or Kelley Blue Book more accurate?”, “Which is more accurate Kelley Blue Book or NADA?”.
In this article, we propose 2 practical exercises determining the values of the same vehicle by NADA guides and KBB. We expose the truth about the accuracy of NADA values vs. KBB values. Who is more accurate? Are NADA RV Values Accurate? To determine if the NADA value is lower or higher than KBB, Edmund, black book, etc., or if it is just our perception, we have made this comparison when possible with precise numbers.
In this article, I explain a pricing comparison to determine how accurate NADA values are.
Why is NADA Value so Low? Wait, Is It?
NADAguides.com and the Kelley Blue Book are benchmarks North Americans use to price vehicles on the market. Both guides are frequently updated but are based on different market parameters. In addition, they define their price lists differently from each other. Therefore, when comparing the values obtained for a given vehicle quoted by KBB and NADA, we must take into account whether we are actually making an adequate comparison or not.
NADA Blue Book Value Comparison Experiment
NADA Blue Book Value Comparison Experiment – Who is more accurate? We decided to demonstrate by a simple 2-stage experiment whether NADA values are lower or higher than KBB values for a quotation made under the same conditions. For that, we set some variables to ensure the correct quotation conditions: the same ZIP code is randomly chosen (72113, AR), exactly the same mileage (87,932), and the date (Mid-August 2022) were used for all quotations.
We chose two vehicles with different market turnover. A 2016-SUV type vehicle with a low market turnover and a 2018 truck with a high market turnover. During the assessment, we ensure to choose the same trim level and standard features.
- Vehicle 1: 2016 Ford SE Escape Sport Utility 4D
- Vehicle 2: 2018 Dodge Ram 2500 Regular Cab Tradesman Pickup 2WD T-Diesel 8 ft
Before deciding which is lower, let’s look at the results of both quotes and what each list price means for the Blue Book value and NADA values obtained.
Value Comparison Experiment Results – Part I
Let’s look at the NADA Blue Book Value Comparison for the 2016 SUV.
The KBB places the vehicle in question at what they describe as the fair purchase price by defining its good condition as a vehicle with some repairable cosmetic defects and no major mechanical issues. Although the vehicle is in good condition, the KBB defines that the vehicle may need some overhauls. The title history is clean. And the vehicle may need some reconditioning for resale. Under these vehicle conditions, KBB values the vehicle at $11,406.
To the NADA guide, clean trade-in values reflect a vehicle in clean condition. There are no mechanical flaws, and the vehicle easily passes all the examinations. The paint, body, and wheels are in good condition. However, it may have some minor surface scratches while maintaining a high gloss finish. The vehicle has a clean title history. The vehicle will need minimal reconditioning to be ready for resale. NADA values it at $11,975.
How Accurate Are NADA RV Values?
If we compare the vehicle condition described by the 2 guides, it appears that NADA’s Trade-In vehicle may be in a better condition, as NADA indicates “minimal reconditioning” versus KBB, which indicates “needs some reconditioning” for resale. So, it still seems to me that they are comparing different things. However, in this case, it is clear that the value of NADA is slightly higher than KBB.
How Accurate Are NADA RV Values? Are NADA RV Values Accurate? When do people say, “Why Is NADA Value So Low?” Is It true? Or Not? As you can see in this example, we have found the appraisal of NADA to be HIGHER than that of KBB. NADA value has been slightly higher. Since SUV pricing is more accurate using the NADA value, we can infer that the NADA RV value is accurate. But let’s look for another numerical example to test if this condition repeats itself.
In the image below, we highlighted the values that are comparable between NADA and KBB with purple boxes. Also included are the definitions of the price lists and vehicle conditions, which are key to understanding whether they can be compared to each other.
As for the private party value, we will not make any comparison as only KBB reports this, while NADA does not include values for private sales. If you want to learn more about how to calculate private party RV value, we recommend this article.
Value Comparison Experiment Results – Part II
Look at the KBB against NADA values for the 2018 Truck (Used 2018 Ram 2500 Regular Cab Tradesman Pickup 2WD T-Diesel 8 ft).
Under the same conditions, the KBB values the Ram truck selected in the comparison experiment at $29,754, while NADA values it at $31,100 for the same vehicle. Even discounting $2,000 for the mileage used, the NADA value is higher than KBB.
Which is More Accurate Kelley Blue Book or NADA?
Are NADA RV Values Accurate? As you can see in our demonstration, we have found the appraisal values of NADA to be HIGHER than the Kelley Blue Book. NADA values have been higher or slightly higher in the SUV and the truck in the two demonstrations. Therefore, to the two most popular questions, “How Accurate Are NADA RV Values? and Are NADA RV Values Accurate?” we conclude that under certain conditions of vehicle inspection, we can infer that the NADA RV values are more accurate.
Which is More Accurate, Kelley Blue Book or NADA? As we demonstrate in these two examples, NADA values were higher than Blue Book Values.
Is the NADA value lower, or are we comparing KBB vs. NADA incorrectly? I am inclined to think that people tend to compare incorrectly, and definitely NADA values do not come out lower. NADA may even value vehicles a few thousand above KBB.
This explains why dealers generally quote trade-in value with KBB instead of using NADA guides because it leaves them a large margin in favor.
On the contrary, banks use NADA guides.
As exceptions in RV appraisals, we can mention that since there is no Blue Book for RVs other than NADA. There are only NADA RV Values; dealers rely on the values provided by NADA. However, most vehicle dealerships prefer KBB because of what we have shown in this article.
We hope you have found this article useful to learn more about Which is More Accurate, Kelley Blue Book or NADA, Are NADA RV Values Accurate? and how to compare values using the NADA and Blue Book guides. We believe that our experiment debunks the myth about “Why Is NADA Value So Low” and “Are NADA RV Values Accurate?“, and we hope that we have demonstrated it in the best possible way.
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