It is virtually impossible to not lose money when you buy a car. Cars depreciate in value from the day they are bought brand new and continue to do so as the years go on. Don’t despair there are ways to minimise your losses and also pick up a bargain in the used car market in New Zealand (NZ).
Which NZ Used Car Should I Buy?
Do NOT buy a second hand Land Rover on impulse in a Trade Me auction without even looking at the vehicle let alone taking it for a test drive! Seriously, people do that? Buy a car without even taking it for a test drive or checking the tyres etc.
European or Japanese?
Fact is that based on consumer reports Japanese cars are more reliable and cheaper to maintain than their European equivalents. European cars such as Audi’s and Volkswagens, especially low kilometre versions do seem to hold their value well though. The most popular used car in New Zealand is the Toyota Corolla which holds its value and has a good reputation for reliability.
Is 100,000km on the clock really too high?
Age of the car is important up to 10 years old, after mileage becomes more important. It used to be that anything over 100,000km after 10 years meant high use. A regularly serviced and maintained car can do closer to 300,000km and still not suffer any major mechanical issues. When looking at higher mileage vehicles ask to see a full service history and take this into account along with age.
What age car is best to buy?
Somewhere between 5 and 10 years old is a good range for a second hand car. At 5 years old the car has depreciated to about half the original value. A new car will have lost approximately a third of it value after 3 years. At around 10 years old you would expect to be paying 20% of what the original value of the car was new.
What about an ex-lease vehicle?
Yes, there is the chance a lease vehicle may not have been treated well. However, they are regularly serviced and maintained so should be reliable mechanically.
What about a car with multiple owners?
If a car has had numerous owners it could be a red flag of a problem and the owners keep passing the vehicle on before it becomes an issue for them. Or it could simply be a matter of timing and finances. “One careful lady owner” used to be a great sales pitch and is certainly more preferable to “Treated badly by a boy racer and his mates”!
Can you afford the insurance premiums?
When looking at a vehicle to purchase keep in mind that performance cars and those with a higher value are likely to cost much more to insure.
Top 5 Tips for choosing your new vehicle:
1. Do not buy any car without taking it for a test drive!
2. Do not buy a car because it is your favourite colour!
3. Do not buy a vehicle on finance unless you can ‘really’ afford the repayments!
4. Do not choose a new vehicle based on the car seat covers!
5. Do not buy a car brand new unless you can afford to lose 50% of that value within 5 years!
Ok so you have found your next vehicle but need car finance in Wellington. Contact Oxford Finance via our website www.oxfordfinance.co.nz as we are a Kapiti car financing company. We can sort out the best car loan NZ for your next used car purchase and get you on the road.