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Buying new car vs used

  1. Oct 23, 2011 #1
    I've heard the all the advice and read all the articles on why to never buy a new car. However from the option I am looking at, buying new doesn't sound that bad!

    Consider my current scenario:

    Used CPO 2009 LX Civic with 23,000 miles = $17,600
    New 2012 LX Civic < 2000 miles = $18,600


    Isn't the newer model with less miles worth the extra $1000???
     
  2. jcsd
  3. Oct 23, 2011 #2
    2000 miles isn't the same thing as new.
     
  4. Oct 23, 2011 #3
    I made the number up, just thought it would have gone through plenty of test drives.
     
  5. Oct 23, 2011 #4

    rhody

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    We had the same problem about 1.5 years ago, ended up with a new Civic DX for college grad daughter, good decision. We went back and forth a few times before deciding on a new one. Good luck. BTW. What is wholesale invoice on the slightly used one ?

    Rhody...
     
  6. Oct 23, 2011 #5
    If you get a model of car when the new model comes out, sometimes you can get a great deal on a new car. It's very rare though, because usually the lots keep their older stock priced up anticipating people wanting a "deal" on the old model cars that "must go".

    In my experience, it's almost always best to buy a used car with around 5-15k miles, provided it's a decent car to begin with, has a decent, proven resale, and is in brand new condition. One other thing I noticed is that (if buying from a lot), the used vehicles that are not of the same make as the dealer are usually more reasonably priced. I think it's because people go to dealer A to buy a car of type A, and thus, they can charge a bit more.

    I have owned 8 new cars and several used throughout my still short lifetime, and I took a hit on every single one of the new cars except for two, which were make B that I got from dealer A, and were going out of style. The same late model (new) cars that "must go" from dealer B were a few grand more.

    Never pay more than invoice on a new car. Their "sticker price" is a joke. Their invoice prices already include profit for the dealer.

    As for purchasing from private parties, I found it to be too much of a hassle. People tend to think their car is worth more than someone elses identical car. By the time I found a good deal, on a good car, that was in good condition, it would have turned out better for me to just buy it from the start for 1k more, rather than waste the months looking.

    It's all anecdotal, so take it with a grain of salt.
     
  7. Oct 23, 2011 #6
    As far as I know the only problem with buying new is the cost. If you can afford it I don't see why not. Used cars can be a nightmare. Every car I have owned has been used and every one of them have cost me thousands with the various problems that came up. If you know what you are doing when buying, and buying relatively new, that shouldn't be a problem apparently but its still a crap shoot. I bought a relatively new Daiwoo that turned out to have a crack in the head gasket. It was under warranty so I took it to a dealer to be fixed. It later developed an on going problem of just deciding not to start on occasion which the mechanics were never able to figure out. Then one day the car just crapped on me. Turned out the dealer hadn't fixed the gasket, only sealed the crack, so the gasket blew and the engine was completely ****ed.

    I may just have bad carma though.
     
  8. Oct 23, 2011 #7

    Pengwuino

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    I think the guy selling the used car is an idiot for asking that much unless the fuel efficiency is really good (which I think those are, right?).
     
  9. Oct 23, 2011 #8
    That's another thing, that price seems incredibly high.

    Edit: Ah! CPO is Certified Pre-Owned. So basically a used car being sold like new. That's why its expensive.
     
    Last edited: Oct 23, 2011
  10. Oct 23, 2011 #9
    Which one? The KBB for the 2009 is 17,550
     
  11. Oct 23, 2011 #10
    Yeah, sorry. I didn't realize what CPO meant. Those cars aren't usually going to cost a whole lot less than new. And its a Honda Civic. They don't lose much in value.
     
  12. Oct 23, 2011 #11
    I believe 20,000 miles on a Civic is worth about $3,000 for the first mile after the original sale and $3,000 for the remainder.
     
  13. Oct 24, 2011 #12
    For those who do buy new cars, how much over invoice is it appropriate to ask for? $100? $200? $300?
     
  14. Oct 24, 2011 #13
    You might want to consult Consumer Reports (April issue?) for an approximate answer.
     
  15. Oct 24, 2011 #14

    Dembadon

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    Disclaimer: I'm not the most objective person regarding this issue.

    I never have, and probably never will, buy a new car. One can usually find a sufficiently new, used car for a better deal.

    This! A thorough treatment of Consumer Reports' reviews has never let me down. I tend to be a bit ridiculous when it comes to big purchases, sometimes spending months mulling over issues that might seem trivial to someone else. I frequently get "buyer's remorse" as well. No, not just after a big purchase like a vehicle or something, I'm talking about anything over $100. I know, I'm sick. So, knowing that the "brand new" car I just drove off the lot, for which I just paid thousands of dollars, is now significantly less valuable would probably give me an aneurysm.
     
    Last edited: Oct 24, 2011
  16. Oct 24, 2011 #15
    My point is that if you buy a new car that holds value well, then it's not that significant a loss. The difference between a 2009 and a 2012 Civic might only be $2k. A 2009 could have 25k miles and older tech.
     
  17. Oct 24, 2011 #16

    BobG

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    There's a couple of things that make the used price too high.

    For one thing, the 2009 LX started at $17,500 and went up (depending on options). The 2012 starts at $17,600 and goes up (depending on options). We're in a recession - new car prices just aren't rising.

    The CPO price is a little high, but in the ball park (especially depending on the options). Hondas hold their price well, although trading a 2009 in would only get you about $13,000 - there's a difference in your resale value and the dealer's resale value (which is one reason dealers like used cars - they usually make more of a profit on good used cars than they do new cars).

    Basically, new car prices are reflecting the reality of today's market and it would appear the used car market (or at least that dealer) isn't reflecting the reality of today's market.

    It's not a good time to buy used.
     
  18. Oct 24, 2011 #17
    Ah I have heard this. Is it similar to house prices falling but rent prices rising?
     
  19. Oct 24, 2011 #18

    BobG

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    One big difference.

    Most people get car loans whether they're buying new or used. Making it more difficult to get a home loan means more renters, even if the cost of houses is decreasing.
     
  20. Oct 24, 2011 #19

    jtbell

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    Many people have been keeping their cars longer (instead of trading them in every few years like they used to), which reduces the supply of good recent-model used cars. Also, more people who are shopping for cars nowadays are probably looking for used ones instead of new ones, to save money, which increases demand for good recent-model used cars. Bingo, higher prices!
     
  21. Oct 24, 2011 #20

    FlexGunship

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    My understanding is that there is a premium on cars which carry a discount (i.e. used cars). The type of "used" that you are considering is not strongly affected. The demand for cars below the $5000 price point has jumped astronomically.

    I was looking for a beater recently and capped myself at $3000. When I looked four years ago, $3000 would buy you a car with ~100,000 miles. This time around I could only find cars with about ~200,000 miles for that price. That's a significant change in the used car market and is mostly because people are avoiding car loans, so anything that can be purchased with cash is in demand.

    Your purchase is unlikely to be affected significantly by this trend.
     
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