Purchasing a new car is an exciting adventure, but it’s also a costly one that merits a lot of consideration, research, and thought. While people are quick to assume a brand new vehicle is the best option, sometimes that just isn’t the case. So, when does it make sense to buy a used car? Let’s take a closer look.
Are You Ready for Instant Depreciation?
One of the biggest negatives in buying a brand-new car is the fact it depreciates a substantial amount the moment you drive off the lot. You don’t even have to own it for weeks, months, or even a year. The minute you drive away, your investment is worth less than what you paid for it. In general, a new vehicle depreciates between 20-30% that very first drive off the lot by you.
Meanwhile, if you purchase a used car, this doesn’t happen.
Think About Insurance Rates
There is a “sweet spot” when it comes to car insurance rates. A brand-new vehicle is going to have high insurance rates, perhaps making the purchase too expensive. At the same time, if the car is very old the rates will go up as well. Purchasing a vehicle that is just a few years old usually guarantees you’re going to get the best insurance rate.
Cheaper All Around
It’s no secret that South Africa has experienced some rather tough times when it comes to its economic climate. With that said, it’s only natural that people are looking for ways to cut costs without having to make too many sacrifices. The sticker price on a used vehicle is always going to be cheaper, which means the payments will also be cheaper.
There have even been some pretty sharp increases over the past two years when it comes to used car sales according to the Automobile Association of South Africa. It’s clear that consumers are realizing there is value to be had in purchasing used.
No Down Payment or Trade In
Another situation where purchasing a used vehicle makes sense is when you don’t have a trade in to make or a down payment. Again, in today’s economic climate, the idea of being able to save a 10-15% down payment for a vehicle isn’t exactly realistic. With a used vehicle, it can be financed in full.
Shopping Tips to Keep in Mind
If you’ve decided that a used vehicle is the way to go, there are some shopping tips that will help you get the best deal out there. First, you want to shop with an AA Quality Assured dealer. Next, you want to look at vehicles with proven track records, such as a used Toyota Corolla, which is known for its ability to last a good long time. Low mileage is always a good thing, as is a body that is free of damage and visible signs of rust.
Purchasing a brand-new vehicle just doesn’t make sense for a lot of people, especially when a used vehicle can offer so many great advantages.