Buying a car, new vs used

liftapint

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I have never owned a new car and frankly never thought I would. But as I shop for a car now, I am struck by how little used cars are discounted relative to new. I was looking at one this morning, 3 years old, 50k miles on it, and only a few thousand less than the price of new.

It seems like in the the past, I got much better deals on used cars. Has there been a shift in the used car market? What is going on here?
 

12thMan

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There definitely has been a shift, I haven't seen it since I'm not in the market but it was brought up in another thread where I was talking about buying a used car vs. new. I have always bought a few year old cars, it is the best value in my mind, however it seems that the used car market has shifted and it is more difficult to find that same deal. With that in mind, I would say look for the cheapest money (best interest rate obviously) and go that route, used being only a few thousand less doesn't seem like a good way to save that money.
 

pltrgyst

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In olden times (i.e., when I started buying cars), the rule of thumb was that a three year old car was worth roughly half its new price. That has obviously changed quite a bit.

Part of it is improved build quality and longer lifespans for newer cars. But it seems that it's five years or so to that 50% point now.
 
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manamongkids

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Lurking curiously as the wife has expressed interest in a new car recently. She really wants to lease as she only commutes about 5 mins to work.
 

trever

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There are some used cars that are a bargain (3yo Caddilac for example, if that's your kind of thing), but overall, used car prices are higher than they used to be.
If you are a "buy it and drive it into the ground" kind of guy, you might as well look for the cheap dealer financing and get a new car
If you flip your car every couple/few years, then it is still better to go used.
 

Payback

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The market shifted during the cash for clunkers initiative and really hasnt shifted back as the demand for used cars is still high compared to supply. Personally if you can get a good deal on a new car I think your almost better off doing that if you keep it for a while especially when you add in warranties, new features, etc.
 

Chicken Rob

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11 years ago, I bought a 9 month old car with 12k miles for 2/3 the new price. Those days are long gone. I recently bought new after shopping around casually for a couple years, and seriously for a few months.
 

Mental Nomad

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10-20 years ago, the few really reliable cars held their value much better than most cars. Most cars lost a lot of value over the first few years.

There are a lot more reliable cars, now.

I think the best savings comes from very-nearly-new cars. When they come back on market prematurely for whatever reason, they still cost a lot less than new. You still lose thousands on a new care when it rolls off the lot and becomes used, but then the price doesn't fall for another year or more before it even starts to move.

I once bought a "used" car with only 7 miles on it. It was a leftover from prior year, so it was priced out as "used" and not a current model car... 20% off of new price, full warranty. No meaningful changes in the model.
 

Chicken Rob

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10-20 years ago, the few really reliable cars held their value much better than most cars. Most cars lost a lot of value over the first few years.

There are a lot more reliable cars, now.

I think the best savings comes from very-nearly-new cars. When they come back on market prematurely for whatever reason, they still cost a lot less than new. You still lose thousands on a new care when it rolls off the lot and becomes used, but then the price doesn't fall for another year or more before it even starts to move.

I once bought a "used" car with only 7 miles on it. It was a leftover from prior year, so it was priced out as "used" and not a current model car... 20% off of new price, full warranty. No meaningful changes in the model.

I recently bought a new car with 90 miles on it. Outgoing model year. Making room for new incoming models. 2015s were already known to be preferable over the 2016s among fans (2016 had transmission quirks). Got about 9k below sticker. used 2014s were about the same price I paid for the 2015. 2013s didn't have the features I wanted.

I think it all comes down to timing and wants/needs. Each buyer should probably do his own research.

The best move I made was go to an on-line site (I think Edmunds.com) to look into best local prices. I had 2 dealerships bidding for my business by email. Got exactly the car I wanted at what was probably within 1% of the lowest possible price without really having to haggle.
 

slisk250

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I did not read all the replies but be very careful buying used. I'm not sure if checking the car history is enough. Some flooded and wrecked cars get sold after trying to hide the fact they were totaled. Make sure your mechanic gets a look.
 

Ben

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Unless you're looking for a specific car, you're better-served today going with a new car from whichever manufacturer is offering the best rebate currently - a manufacturer rebate generally puts a brand-new car BELOW the price of the same slightly-used model (at least, as long as you know and are able to get the "real" price, not the "gouge the car fish" price - it's REALLY not hard to do this, these days - often all it takes is an internet inquiry, rather than just showing up on the lot.)
 

stocky

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11 years ago, I bought a 9 month old car with 12k miles for 2/3 the new price. Those days are long gone. I recently bought new after shopping around casually for a couple years, and seriously for a few months.

Last year my dad purchased a used car 3,000km 1 year old for 2/3 of the price of new.

Come here and buy your new beast :)
 

brianb1091

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I don't know if cars are depreciating as drastically as they once did. I just bought a new GTI and when I was at the dealer they had a used one that a guy had bought a month ago and then found out his wife was pregnant with twins. They obviously needed something bigger so they traded it in. Had probably 1000 miles on it and was only about 2K under sticker for a new one.

For me I always look new because I like the security of the warranty. I don't have a lot of available savings to deal with big repairs and don't trust myself enough to know that I am buying a used car that will end up being dependable and not a clunker.
 

grandgnu

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I bought a 2013 Nissan Altima Coupe 2.5S back in March and negotiated it down to $12,250 (had about 58K miles, so high mileage for the year). Retail when new was 23-25K so I'm happy with the discount.

But my next car I may be purchasing brand new for the first time, given all the promotions available these days.
 

moose

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People stopped buying new cars during the crash of 2009 and now the average age of a vehicle in the US has hit 11.5 y. Demand has outstripped supply for used cars which has buoyed prices.
 

acl1904

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If you decide to purchase a used vehicle, look into possibly purchasing a CPO vehicle (certified pre-owned) that was certified by the manufacturer (instead of the dealership). These pre-owned vehicles are brought up to par and are thoroughly inspected by the manufacturer. I strongly believe CPO vehicles give you more bang for your buck.
 
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