Buying a Used Car?

[maat55]

We just bought an 06 BMW, Had 53k miles. I bet we got it for much less than the new price. We love it and I'm betting it will last the 7 years we'll have it.

[Seeker]

We just bought an 06 BMW, Had 53k miles. I bet we got it for much less than the new price. We love it and I'm betting it will last the 7 years we'll have it.

Yup, when you buy "name" then it's pretty much impossible to find a lower price "new." That'll never happen.

A slightly used Honda will hold a considerable part of it's value during the early years (depending on care and mileage); Honda is also a "name" (valued for reliability), and thus a slightly used Honda will still cost a good amount of $'s.

So the real question becomes, is the person after a reasonably priced auto going to pay a premium for a slightly used car that still is pretty expensive, or will he or she settle for a different manufacturer and model that will cost less new? Or slightly more new?

CHH went slightly more for new, but he ended up with a different manufacturer and model.

OP dilemma was between the same make/model car. If that's the case, then the used car is the better long term "deal" assuming all other considerations are about equal.

And Maat, your decision was also between the two years of the same manufacturer's auto. Same thing. Probably the best choice for you.

----

Someone else said that "new cars" are not always better. That is true too. Sometimes the breaking in of a car will show defects that will not appear in a new car. Anyone buying "new" can end up with a "lemon"; just like with any used car.

[elessar78]

As a Honda Accord purist, I think you also have to find the "deal" sweet spot.

Honda's hold their value because, historically, they are reliable into the 100K+ miles range. But I find that that's where the best deals are but it's not easy to find used Accords for sale in that range.

For example, my 03 Accord with 125K miles on it prices out (private seller) at a high end of about $7,000 but a quick Yahoo! autos search finds me a lot of the same make/model in that price range, even cheaper.

So if you trust the reliability history and the educated guess that you won't have to sink major money into keeping your Accord running—Then you can make a good buy. Plus very few people can tell the difference between an 03 and 08, the years before the latest redesign (if you're concerned about that kind of thing, which in some ways is legitimate). Personally, if I could find an Accord that passes my inspection for $5,000 with 150K miles on it, I think that's a deal.

The funny thing, at least with my Accord, is that it has outlived my needs. Meaning I bought it as a 23 year old, brand new (bad parental advice). So I bought a nice, sexy sleek two door. Fast forward 8 years later and I have it paid off but also have a wife and kid now and the car seat won't go in the back easily. And we'll probably have another one before this one is ready for the scrap heap. Anyway, point is that with an Accord/Camry you might need to project out longer than usual what your family's transportation needs will be.

[snafu]

We drove Accords and Camry's to the 200,000 mark and sold before they started to have issues. Got a great deal on a Hyundai when we needed newer wheels PDQ. the following week were went to a lecture featuring Phil Edmunds, author 'Lemon Aid.' When we spoke to him after the lecture, we were surprised to learn he and his wife both drive Hyundai's. He explained that the Quality Assurance team at Honda were hired by Hyundai in time for their 2006 model change out.

If you don't care about status, you might check out deals on 2-4 y/o Hyundai and drive it for a long time as they are short on re-sale value. Don't pick the sport car ...those problems are still unsolved.

[elessar78]

We drove Accords and Csmry's to the 200,000 mark and sold before they started to have issues. Got a great deal on a Hyundai when we needed newer wheels PDQ. the following week were went to a lecture featuring Phil Edmunds, author 'Lemon Aid.' When we spoke to him after the lecture, we were surprised to learn he and his wife both drive Hyundai's. He explained that the Quality Assurance team at Honda were hired by Hyundai in time for their 2006 model change out.

If you don't care about status, you might check out deals on 2-4 y/o Hyundai. Don't pick the sport car ...those problems are still unsolved.

That's really interesting Snafu. I think people who buy Hondas aren't necessarily concerned about status maybe you could say they like the perception of being "practical" and "sound" people.

But I think more and more Hyundai's reputation is growing as is the Ford Fusion. For the longest time I never really considered brands other than Toyota or Honda but I think there may be more bang for one's buck with either Hyundai or Ford.

[annabelle]

My husband's 1999 Honda Accord has 275k miles on it. He's in outside sales. Drives a ton. That car is a workhorse and still going strong.

That said, he's ready to trade it in. Little quirky things have gone wrong like the power windows no longer work (and costs too much to fix). So going through a drive through bank or restaurant has been quite a challenge. The car has served him well. We are now deciding on trading in for another used Accord or jump ship to get a Camry, Altima or even a VW sedan. We need good MPG, reliability and low maintenance costs.

As far as used vs new: when I was needing a new van, I wanted an Odyssey. At the time, I wanted the latest SAFETY features. That had us locked into a market of NEW to about 2 yrs old. When I looked at pricing at 2 yr old Ody's, they were about the SAME price as the "left over NEW stock" they still had on the lot. It was a no-brainer. We bought NEW for the first time in our adult lives at USED car pricing. A lot of our friends who bought Ody's after us couldn't get the same 'deal' as we did. I think we got really lucky. Plus, it was pretty seamless: negotiated all the numbers over the phone (so we didn't have to take 3 wild children into the dealer), told them to have the paperwork ready, we went into sign on a Sunday, right before closing on the last day of the month of Sept. We rushed in there before they changed their mind on price!

So, yes sometimes buying NEW can be had for USED car pricing. But as a general rule: used cars are a better financial decision. But do your homework. Make sure there's enough of a price differential to justify getting used vs new.

[disneysteve]

For the longest time I never really considered brands other than Toyota or Honda but I think there may be more bang for one's buck with either Hyundai or Ford.

I've had a Toyota Camry since 1991 (a 1991 until 1998 and now a 1998 since then). My plan all along was to buy another Camry next time around but I've reconsidered. I don't like the latest redesign of the Camry. I've driven them a few times when I had a service loaner. I will probably look at a Hyundai Sonata when it is time to replace my Camry. I've "only" got 130,000 miles, though, so hopefully, I've still got a few years.

[elessar78]

Yeah, I'm getting the vibe that the Hyundai Sonata is slowly becoming the Accord/Camry of 20-30 years ago: a car that people who want good mileage, long-term reliability, and great value go for.

Maybe when we're out of debt and flush with cash, I'd like to get a Lexus IS250(or the equivalent). Main reason is that it has AWD in a sedan, pretty useful since we live in a pretty rural area.

[disneysteve]

Yeah, I'm getting the vibe that the Hyundai Sonata is slowly becoming the Accord/Camry of 20-30 years ago: a car that people who want good mileage, long-term reliability, and great value go for.

Had they not redesigned the Camry, I wouldn't give switching brands/models a thought. I would have just gone with another Camry. I just find the new Camry not all that attractive or comfortable. I don't like how they repositioned the door panels, armrests, etc. It no longer fits the way I like to sit when I'm driving.

[jIM_Ohio]

There is info on smart money (article posted today) that there is inflation on used cars- used cars which sold for 5k last year are selling for 6k today (same make/model with same milage).


I suggest anyone buying a car assign a value to one year's of car usage. Not the price you pay, but how much is a car "worth" to you for 1 year?

Then also note how much milage YOU put on cars per year

Then ask yourself a few more questions
a) can you "afford" to drive a car into the ground? If you "travel" for a living and missing a client/customer appointment risks a job, then you cannot afford to drive a car into the ground. If you would be stuck in an office or between the office and home, you "might" be able to afford to drive a car into the ground. Same question if you have kids...
b) what monthly payment (or cash available) do you want?

Then use all of that data to reengineer the way you pay for the car.

For example, if you think a car's usage is worth $4000 per year, remember that number. You might come up with that number because you are willing to pay $300/mo for the car, or some other way you deal with costs. The last two times I have had car payments, they approached $700/mo, but my value for the car was NOT $8400/year. To me a car is worth about $4000/ per year (more on this later).

Find two used cars you would consider owning (based on make/model/year/milage) then compare numbers.

For example if car A is a 2005 model and has 30,000 miles and asking price is 25k, then there is a 2004 model with 60,000 miles and asking price is 21k, you need to ask yourself:

1) can I drive the 2004 model the same number of years as the 2005?
2) is the 1 year less (or 2 years less...) you could drive the 2004 car worth 4000 less? Or reverse that- is it worth 4000 more (out of your pocket) to drive the car for 2 more years?

3) then compare that analysis to a new vehicle
If you could purchase same 2011 make/model for 35k, and get 4 more years out of vehicle, is that same 4k per year value the same?

In general if you finance vehicles for short amounts of time (high payments) you will probably come out ahead buying because you will have to purchase fewer cars. This works best if when car is beat up, you can drive it into ground.

For example my wife travels for work, client to client, and needs a reliable car- she can be 100 miles from home and need to pick kids up at daycare in 2 hours. However I need less car than that- I could get away with not being home from work on time or similar, so when her car becomes "less reliable" we can have me use it, then wife can get replacement car when my car is driven into ground.

Any time I have looked at new vs used, there was not enough off the price to make it worth the 3-4 less years I could drive the used car. But I also buy Honda, so I know a new car lasts me 15 years and those extra few years of usage when I pay $700/mo for the car add up (3 years of no $700/mo payments approaches 20k)

[disneysteve]

For example my wife travels for work, client to client, and needs a reliable car
However I need less car than that- I could get away with not being home from work on time or similar, so when her car becomes "less reliable" we can have me use it

This is where I tend to disagree with you, Jim. I would never, under any circumstances, allow myself or my wife to drive a car that I felt was "less reliable." Not because either of us need it for our jobs or other reasons but just because I don't want the hassle of driving a junker that breaks down every other week.

As I've posted before, our cars are currently 10 and 12 years old and each have over 130,000 miles on them. I consider them as reliable today as ever. When the day comes, and it will come, when I have reason to doubt the reliability of either one, we will replace it. Until then, we'll keep them.

Just last month, we took the 10-year-old van to Florida - 1,000 miles each way plus another 600 or so miles while we were there, so nearly 3,000 miles total in 2 weeks. I wouldn't have attempted that with a car I didn't trust.

[jIM_Ohio]

This is where I tend to disagree with you, Jim. I would never, under any circumstances, allow myself or my wife to drive a car that I felt was "less reliable." Not because either of us need it for our jobs or other reasons but just because I don't want the hassle of driving a junker that breaks down every other week.

As I've posted before, our cars are currently 10 and 12 years old and each have over 130,000 miles on them. I consider them as reliable today as ever. When the day comes, and it will come, when I have reason to doubt the reliability of either one, we will replace it. Until then, we'll keep them.

Just last month, we took the 10-year-old van to Florida - 1,000 miles each way plus another 600 or so miles while we were there, so nearly 3,000 miles total in 2 weeks. I wouldn't have attempted that with a car I didn't trust.

You don't know a car is less reliable until it was not reliable one time.

Then the issue is knowing was that a one time thing (like bad alternator) or a sign of long term deterioration. If it happens a second time, what then? Third time is a trend...

My point was that for some jobs, that happening once is one time too often- my wife is a senior member of her team, so it happening once is probably OK, then I get rid of my car, replace it with a newer one, give wife the newer one, and I take the one which might break down.

You don't know a car is less reliable until it starts creating repair opportunities.

[greenskeeper]

Just about any car built after 2000 should go to 200k miles without a major repair (if maintained). Tolerances and oil technology have come a long way.

[snafu]

adding a footnote to greenskeeper's statement...so long as the vehicle has been faithfully maintained and serviced. The owner must stay appraised of any recalls or resolve issues with their vehicle.

[disneysteve]

You don't know a car is less reliable until it was not reliable one time.

Then the issue is knowing was that a one time thing (like bad alternator) or a sign of long term deterioration. If it happens a second time, what then? Third time is a trend...

My point was that for some jobs, that happening once is one time too often

Any car can break down. It doesn't matter what make or model it is or how old it is. Sure, an older car may be more likely to do so but that doesn't make it unreliable.

Since 1989, we've owned 7 cars between us. As far as I can recall, I've had to call a tow truck once about 15 years ago for a car that was 6 years old and relatively low mileage at the time (a Hyundai actually) and had a small fire under the hood.