Posted on 01/05/2024 9:37:04 AM PST by SeekAndFind
It’s been a tough few years for car buyers. Pandemic-related chip shortages sent car prices soaring. Russia’s invasion of Ukraine in 2022 only made things worse.
However, the dust may be settling on car prices -- especially used car prices.
According to CarGurus, the average used car price has been on a downward trend since last summer. As of 2 January 2024, it’s $28,247.
While that may sound high, it’s nearly $20,000 lower than the average new car price, which is over $48,000, according to Consumer Reports.
The truth is that buying a used car is almost always cheaper than buying a new one (unless it’s a luxury or collectible car that appreciates in value). It often means getting more bang for your buck.
But now that used car prices have fallen more rapidly than new car prices have, buying a used car may be an especially good deal.
On top of the lower sticker price, used cars have other cost benefits. For one, they depreciate at a slower rate. According to Kelley Blue Book, cars typically depreciate by 20% in their first year (about 11% is lost as soon as you drive the car off the lot). After that, they lose about 60% of their value within the first five years (about 10% per year).
This means that buying a brand-new car makes the least financial sense because you’re taking the biggest immediate loss. For example, 11% on a $50,000 car is $5,500.
By buying a car that’s at least a few years old, you’re letting the previous owner take the biggest depreciation hit.
According to Tiger Okeley at used car dealership Oak Motors, “Depreciation is an unavoidable part of car ownership. But savvy buyers know they can get a major discount by buying a used car with under 60,000 miles
(Excerpt) Read more at americanthinker.com ...
Better title: Buying a New Car Never Makes Economic Sense
Your advice was good in the 1970’s. It’s no longer appropriate. Car last forever now. In 2009, I bought a 2006 Pontiac Vibe with 145,000 miles. I sold it about 3 years ago with 300,000 miles. The original clutch started to slip. The most expensive shop repair was $95. Brakes, tires etc. was the only maintenance.
My wife drives a 2015 Chevy Equinox. We just did about $800 in tires and suspension work. For a car we paid off years ago, I’m not complaining. At 120,000 miles, I just replaced the original battery this week.
Cars should easily go 200-300,000 miles with just normal maintenance. It makes little sense to buy new.
I bought my 67 Camaro for $250 bucks in 1978. I have to use it as a product Demo at the 2024 SEMA car show, so it will be pimped to the max. Worth $60k.
So I think I will stick with used cars.
I’ll admit here and now the last new vehicle I bought was in 1990. Dodge Durango(35K)... ...it lasted 6 years. since then, i’m on my 5th throw away used car/van. I spent no more than 3K on each(1/2 to 3/4 ton full size work vans). 3 of those lasted over 6 years.
When you get done tryin to impress your peers, your budget becomes comfortable...
Auctions, Mecums auctions even, have classic cars which are usually pretty nice- some for not much money=- if they aren’t popular hotrod vehicles- like around $5000- to about $20,000 depending on make and model- f course it’s a risk- not knowing how the engine is, valves, rings, transmission etc etc- but so isn’t buying recently owned vehicles-
Eating Soylent Brown makes more sense then buying beef. Same protein content at 1/3rd the cost. Easier to make the mortgage and tax payments.
Pontiac Vibes were made by Toyota. They’re good cars.
Actually it was a well done joint venture. Toyota engine, Pontiac assembly.
Killing that car was the worst thing GM ever did. They should have transferred it to Chevy when they killed off Pontiac
Buying used makes sense for people purchasing mid-line and fancier cars. If you’re wanting a Lexus or BMW, there will be some tool that gets rid of their car after 2-3 years because they want something newer and better.
If you are frugal person like my, you buy the least expensive vehicle that will be reliable and fill the function, new, and then take great care of it for 20-30 years. I bought a Mitsubishi Mirage (Dodge Colt)new in 1985, drove it 307K until it died, bought a CRV in 1998, got 298 miles out of it, STUPIDLY bought a TDI in 2015 that was a POS and got rid of it and bought a new Toyota Corolla in 2021 which I intend to get as many miles as possible out of. Oil changed at 3-5K intervals, all service work done on schedule.
Used would make sense if I wanted something pretty, fast, cutting-edge because those cars drop 20-30 percent of value very quickly; people who buy bottom of the line Toyotas and Nissans and Fords like me hold on to them for decades, so I couldn’t care less about depreciation.
No one ever sells a used care because it runs too well.
Buying used is always better sense.
The best are those with the keys that have a chip in the handle. The new wireless push button ones are hackable with a lap top.
Also some cars come without a manual parking brake. Ridiculous.
But plenty of people buy a new car they can’t afford comfortably.
And the people who are impressed only by your possesions aren’t worth impressing.
The purchase of a new vehicle made sense to me in 1976. But the enormous increase in taxes piled on top of the vehicle price is a deal-killer.
The only thing I like that has been added to latest model vehicles is the backup camera.And that can be added to an older vehicle.New enough to have air bags and old enough not to have wifi spying on me will be fine.
Used car prices may be falling, but need to fall a lot further before many of us can afford a decent used car...if we can even FIND one. From what I see, the new car is horribly overpriced & the used car is just badly overpriced.
I always buy new. I like having the latest safety and useful technology. Not to mention, I’m not interested in someone else’s problem child.
Both of these are really valid points:
“But plenty of people buy a new car they can’t afford comfortably.
And the people who are impressed only by your possessions aren’t worth impressing.”
You are completely correct. But....
I have exactly zero sympathies for people who spend money they don’t need to. I have no need of anything other than getting myself, wife, and dog down the road.
If some idiot has to spend $30, $40K or more on something fancy that’s their business, if they can’t afford it and it gets repossessed I really couldn’t care less. I don’t care about rich folks at all, be it some twat in driving a $70k BMW or fancy-a$$ pickup or some dolt with a private jet, more power to ‘em and zero damns to give if their lifestyle crashes and burns.
To *me* it’s impossible for any vehicle ever made to be worth more than $25K, more than that is for folks who have WAY more money than me. I own a house in California and one in Montana, car, truck, and Harley and have no debt and a decent 401K, but I live more frugally than some of my friends making minimum wage.
If you can’t pay cash, you can’t afford it. IF you need something better than bottom-of-the-line that is reliable enough then don’t blame me for laughing when it gets taken away by the bank or depreciates when you go to sell it (I am using, of course, the rhetorical “you”, not directing it at you).
I have several friends who are multi-millionaires, NONE has a fancy house or car or wears clothes that aren’t from Costco or Walmart; the people with insanely expensive $30K+ cars and fancy clothes also seem to have debt, and often lots of it.
Yeah, I get that some people might actually *need* something more than a bottom of the line Toyota, hell I have a $27.5K carved German upright bass viol, because I’m good enough to be worthy of it, but I paid cash that I made playing music for it, and still use it for work in my side gig.
I've been watching some car dealer videos. One is a good old boy from the Carolinas who buys used cars wholesale with cash and resells them for $5K max. Toyota is his number one car to acquire if he can get it at his price point.
No thanks. I buy new because way too many people do not maintain their vehicles.
The most expensive part of every car built is the new car smell.
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