There are many things to consider when buying a car, most of all, whether to buy new or used. Below we explore the inherent pros and cons of new and used cars.
Buying a car is a major life decision. While being a huge financial commitment, the search for and ultimately the purchase of a car is an exciting time. However, buying a car can also be quite stressful.
There are many factors to consider when it comes time to buy the right car, such as make, model, new or used. Buying new or used cars come with inherent advantages and disadvantages, so the decision should be a personal one that is based on research.
Buying a new car
With more than 60 manufacturers ready to take your money in exchange for a brand new car, buying a new car has never been easier. It’s also never been a better time to buy a car as current low-interest rates make financing more accessible.
When it comes to buying a new car, the pros include:
- Freedom of choice: when buying new, the options are well and truly endless. This means you can buy a car that is exactly what you wanted in terms of spec level, color, and engine. Making for a highly personalized buying experience.
- Manufacturer’s warranty: buying new gives you peace of mind. With manufacturer’s warranties now available in excess of 7 years, this means you are covered for the entire time you are likely to own the car.
While new cars seem shiny and perfect on the surface, there are cons, such as:
- Depreciation: New cars cost more. This expensive process starts when you first buy the car and carries through to the day when you inevitably try to sell it. With the car depreciating as you drive it out of the lot, in years time the resale value will be low.
- Issues with servicing: when buying new, you may be limited to servicing the car at the dealership where you bought it. This is because some dealerships will only extend factory warranties if you service the car with them.
Purchasing a used car
Purchasing a used car is a popular option. In fact, for those financing their car purchase, 69.5% of borrowers choose used. This is largely due to the fact that the savings outweigh any perceived negatives.
Purchasing a used car is a smart option that comes with a range of advantages such as:
- Lower upfront costs: buying a used car is a lot cheaper upfront. This is of course because the car has been used, but also because private sellers will be open to bargaining in order to move the car on. There also won’t be any additional charges.
- Better deals: you may be lucky and find that an older car model is actually similar to the newer model car you’re enamored with. The older and used car will come at a significantly reduced price, resulting in a great deal.
Like anything, buying a used car has its disadvantages, such as:
- Compromise: when buying a used car, buyers have to choose from what’s on offer, rather than specifying exactly what they want. This means that an element of compromise will be at play as the used car market is a smaller pool to choose from.
- Risky: unless the manufacturer’s warranty still has time left on it, buyers of used cars could get stuck with an under performing car and have no recourse. This in turn could see buyers outlying more money on a used car than it would’ve cost to buy new.
Deciding to buy a car
Whether looking to purchase a new or used car, there is a vehicle out there for everyone. This is good news as there’s never been a better time to buy a car thanks to the sheer amount of dealerships and private sellers available today.
While the decision between a new and used car may cause some pause, it’s important not to lose perspective. Whether buying new or used, pick the car that best suits your needs, because at the end of the day, you are buying the car for a purpose.
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