Cars… Buying a car is a huge financial decision and one of the most highly debated issues is buying new versus buying used. I’ve already let the cat out of the bag and told you that I bought a new car so let’s get to why I chose buying new despite the common advice to buy used.
Buying A Used Car Is Generally A Better Deal
In general buying a used car is normally a better deal. In general does not mean always or without exception. Normally new cars drop dramatically in value when you drive them off the car lot. You can take advantage of this by buying a late model used car that was brand new just a year or two ago.
Why I Decided to Get a New to Me Car
It was winter 2010 and my trusty 10+ year old Honda Accord had finally started giving me problems. I had bought it a few years earlier as my very first car and it had been great to me. I was able to fix the problems relatively cheaply. The car was at the point where bigger issues were right around the corner. I decided to sell it while I could still get a decent chunk of money for it and that meant I needed a new or used car to replace it.
I researched for over a month to find out what type of car I wanted and had finally decided I wanted a 2006-2010 Honda Civic. I did look into other cars like new and used Toyota Corollas but I just didn’t fit in the car. I was too tall. All of the Honda Civic model years were relatively similar but I wanted to try to save some money and get a used car. I researched extensively to find the used Civic I wanted. The only problem was that most of the late model Civics were only $1,000 to $2,000 less than a brand new Civic and had 50,000 to 75,000 miles on them (common for Washington, DC). Why were these late model used cars so expensive?
Buying a New Car Was a Better Deal For Me
Notice the last two words above “for me”. This isn’t the case for everyone, every type of car or every time you’ll buy a car. So why did I get a new car?
When I bought my new Honda Civic in early 2010 there was a perfect storm brewing for new car buyers. The US economy was in recession and automakers were being taken to cleaners. Car sales were the lowest they had been in a long time and car dealerships couldn’t do enough to get inventory off the lot. They were stuck with a lot of cars they had made in anticipation that cars would still be selling like the had in the past but instead used cars were going at a premium because everyone was looking to save money.
In the end I got the car dealership to sell me a brand new Civic for over $1,300 below invoice. It has less than 10 miles on it and I would have saved only about $500 to $2,000 to acquire a year or two old Civic with a ton of miles on it. I decided that the extra money was worth it. I would know the entire history of the car and it came with a warranty that would protect me against any manufacturing defects in the beginning. I felt much more comfortable knowing this.
The service I used to get my price said at the time it was the second lowest price on Civics in the nation at the time. I was lucky that I lived in the area that allowed me to get a great deal. If I had lived somewhere else maybe a used Civic would have made sense for me. I was lucky that it didn’t and I ended up getting a new car.
Where do you stand on the new vs used car debate? Does it depend on the deal you can get or do you always buy new or always buy used?