Do 5G Phones Sell For More Money than 4G Phones?
Resale numbers show that 5G phones pull in more money than 4G models, sometimes by a large margin. Network speeds and coverage aren’t the main factor behind the price gap. 5G phones bring higher values because they’re newer model releases across the board, and newer models pack in big upgrades beyond the radio itself. Better cameras, faster processors and multi-year software support commitments all come in the same package. Buyers who shop for used devices care about every one of these features. 5G models check those boxes more reliably than older 4G devices can match.
The price difference between 5G and 4G has narrowed quite a bit over the last few years. Plenty of budget-friendly phones now have 5G built right in as a standard feature, and you don’t pay anything extra for it compared to similar phones from just a year or two ago. We can thank the increased competition and bigger manufacturing runs that brought these costs down across almost every price bracket. Even with this progress in the market though, plenty of shoppers still believe that 5G means you’re looking at premium prices. This assumption continues to hang around and creates uncertainty for shoppers and retailers about where the value is as you pick out a new smartphone!
Let’s compare the prices to see if 5G phones command higher resale values!
How the 5G Price Gap Disappeared
When 5G phones first arrived in 2019 and 2020, they cost quite a bit more than the 4G phones most of us were already familiar with. Most manufacturers were adding between $100 and $300 on top of what you’d normally pay for a similar phone without the 5G capability built in. The premium made sense back then because 5G was still brand new and the modems needed to make that connectivity work were expensive parts for manufacturers to source and build into their devices.
But that price gap has shrunk down to almost nothing. Samsung’s Galaxy A series shows this trend quite well. Mid-range phones in this lineup have 5G already included and you’re paying about the same amount you would have paid for the older 4G models just a year or two ago. The newer technology is now available to you without any increase in what you’d normally spend on a phone in this category.
These price drops mostly come down to the economies of scale - costs drop when you produce in massive quantities. More manufacturers started making 5G parts, and at the same time, phones with 5G began selling in much higher volumes. Production scaled up across the industry, and the cost to manufacture each unit fell substantially. Competition between phone makers accelerated this trend too. Once a few phone makers started bundling 5G into their mid-range models, everyone else had to follow along, or they’d lose customers to competitors who offered better value.
Modems used to be pretty expensive and were a big reason why some phones cost a lot more than others. Manufacturers have become much better at making them over the years, and the suppliers that make the parts have scaled up their production quite a bit. The cost to make each modem has dropped significantly. Phone makers are paying less for them now and most of them have passed those lower costs on to the customers. Features that seemed like premium upgrades just a few years ago are now standard across the board.
Why Features Matter More Than Network Speed
High-end phones usually have 5G built in, and many consumers believe that the wireless technology is what makes them so expensive. But that’s not quite accurate.
Most high-end phones have 5G already built in, and there’s actually a pretty simple reason for that. Phone makers design their flagship models to be the absolute best that they can make and that means they pack in all of the premium technology they’ve developed. The cameras on these phones are great - they’ll take beautiful photos when you’re in bright sunlight or a dimly lit room. The processors are fast enough to run demanding apps and games, and they won’t slow down or freeze up on you. The screens are also very beautiful, with colors and sharpness that make everything from videos to text look extra sharp.
5G is included as part of the package because it’s become a standard wireless technology in modern phones at this point. A luxury car comes with a backup camera included. Nobody buys that car just for the backup camera though. They want the engine, the leather seats, the premium sound system and all of the other features that actually make it feel luxurious.
The same concept applies to phones. Two different models might each have 5G connectivity. But one could cost twice as much as the other. That price difference comes from everything else that’s inside the device - all of the extra parts that set a premium phone apart from a budget model.
Build quality and camera performance also have a big effect on how well phones hold their value later. A device that’s built well with a quality camera will sell for a lot more money on the used market than a cheaper model with the same 5G capabilities. The latest network technology alone won’t be enough to maintain a strong resale value.
Why 5G Phones Hold Their Value Better
Resale value matters quite a bit when it’s time to sell your phone. Your 5G or 4G capability matters in what buyers are willing to pay. Those who buy used phones will usually spend more money on 5G models compared to 4G ones. This comes from how new the 5G technology still is. Most phones that support 5G haven’t been on the market for very long and this helps them get better prices. Devices with newer tech hold their value much better over time and depreciate at a slower rate than older 4G-only models do.
The resale numbers on these phones tell an interesting story. A 5G phone from about two years ago can probably still get around 60% of what you originally paid for it back. Compare that to a 4G phone from around the same time and you’re only looking at about 45% of what you paid for it - it’s a large gap when you actually sit down to sell or trade in your device.
Plenty of buyers ask why they should even care about 5G capability if they live somewhere without any coverage yet. The main reason is pretty simple - nobody wants their phone to become outdated too fast. They might not have access to 5G towers in their area right now. But everyone knows that those networks are going to continue expanding over the next few years.
Network capability matters when you’re trying to resell a phone. But it’s not the whole picture by any means. The physical condition of your device and how well it works are just as big of a deal to buyers, sometimes even more so. The amount of storage also changes what buyers are willing to spend on a used device. The brand name on the back of the phone matters too. Premium phones actually follow a different set of patterns in the used market. The way flagship models hold their value and get resold doesn’t necessarily match up with how it works for the budget options.
How Carriers Make 5G Phones Cheaper
Phone carriers have strong control over what you’ll pay for a new device. After investing billions of dollars to build out 5G infrastructure across the country, these carriers are looking to fill those networks with users. One of the best ways they can do that is through subsidies on 5G-capable phones - and these deals are far more aggressive than anything they’d give you for a 4G model.
Trade-in promotions show you how carriers like to push customers toward newer technology. A carrier might give you $400 off if you trade in your old phone for a new 5G device. That same trade-in might only get you $200 off if you want a 4G phone instead. Carriers usually divide these savings into monthly bill credits and spread them out over a period of 2 or 3 years. The effect is that you get a lower monthly payment on the phone with the better technology.
Carriers have poured billions of dollars into building out their 5G networks, and at this point they desperately need a way to justify all that spending. Wall Street wants to see proof that the investment paid off, and carriers need to show that these networks get used every day. An empty cell tower is awfully hard to defend when you’ve already spent that much money to build it. If carriers can get more users to upgrade to 5G-capable devices, it gives them something concrete to show investors as proof of returns on that big infrastructure spend.
Carriers run sales and promotions throughout the entire year, and they usually time them around big phone releases or holiday shopping periods. Waiting for one of these windows can save you a few hundred dollars on the exact same device. A phone might cost $800 in one month and then drop to $400 the next month once the carrier rolls out a fresh trade-in program.
Prepaid customers don’t get access to any of this. Going with a prepaid plan means you’ll pay much closer to the phone’s full retail price because those monthly credits just aren’t part of the package like they are with postpaid plans. The whole calculation changes at that point and 4G phones start to make a lot more sense when you’re looking at what you’re actually going to spend.
The sticker price you see advertised almost never tells you what you’re going to spend as you own the phone. Carriers love to pile on promotions and incentives and then add some more calculations you’ll need to work through. Only after you factor all that in can you compare what 5G is going to cost you compared to 4G.
Factors That Affect Your Phone Value
The network generation will affect your phone’s resale value. But it’s just one of a few factors that affect what a buyer will actually pay for it.
Brand name matters quite a bit in the resale market. Apple has built up a strong reputation for products that manage to hold their value as the years go by, and that’s true for any network technology built into them.
The condition and performance of your phone will make a difference in the prices you’re going to get. A cracked screen is one of the fastest ways to tank your resale value compared to a device that’s still in pristine condition. Battery health is another big consideration, and most buyers will look at this before they settle on a price. If your battery drains fast or can only hold about 70% of its original capacity, those prices are going to come in much lower compared to what you’d hope for.
Whether the phone is locked to a carrier or not also plays into what you can get for it. A locked phone only works with one particular carrier, so the buyer has to stick with that network. An unlocked phone can be used with any carrier that the buyer wants, and the flexibility is worth money when you’re ready to sell.
How long you hold onto your devices before you move on to something new matters quite a bit when you’re shopping for a new phone. That shiny new 5G model probably won’t make a whole lot of financial sense if you upgrade every year. Depreciation hits phones pretty hard during the first year of ownership alone. But hanging onto your phone for three or four years before you replace it changes the math quite a bit. Spending extra money up front on newer technology with better specs might actually save you money over the life of the device.
How you actually use your phone every day is probably the biggest factor worth looking at when you’re shopping for a new one. Maybe you need the fastest network speeds you can get because your job relies on it. Camera quality could matter more to you than download speeds. Battery life might matter more for how you live your life than having the latest processor inside.
Trade Your Old Phone for Cash Today
The smartphone market has changed quite a bit in the past few years, and if you’re trying to see if 5G actually makes your phone worth more when you go to sell it, the answer is a little bit more complicated. 5G phones do usually sell for more money. But the 5G radio itself isn’t the reason why. Most phones with 5G are just newer models, and they came with better cameras, faster processors and a whole bunch of upgraded features right out of the box. The 5G part has just become another checkbox feature that everyone expects to see on the spec sheet now, just like how 4G became standard about 10 years back. When you pick out your next phone, the biggest factor is probably what you actually need from it day-to-day and where you live. 5G coverage is still pretty spotty in many areas, so it might not even matter much for you yet.
Premium features trickle down to the budget phones fast. Technology that felt brand new just 2 years ago is now available in phones that cost just a few hundred dollars. The better move is to skip the latest buzzword every month and think about how you actually use your phone day-to-day. A great camera could be the most important factor if you take lots of photos and videos, or battery life could be what gets you from morning to night. Your carrier’s promotions can also make a difference in the final price.
At ecoATM, we make it pretty easy to turn your old phone into instant cash whenever you decide it’s time for an upgrade. We have more than 6,000 kiosks all over the country, and they can all run a full diagnostic on your device right there. You’ll either leave with the cash in hand that same day, or we can send the payment straight to your account if that’s easier for you. It’s a pretty simple way to get a fair price for your old device, and you help out with the environment at the same time!
