Buying an "almost new" but used car instead of a New one?

Question

I have been told that it is much wiser to buy a used car - a few months old with about 2000-3000 miles on it - than buying a new car since it depreciates as soon as it leaves the showroom.

Is that true? I am planning to buy a Toyota corolla, what kind of depreciation should i expect and how much less than MSRP do you think should I pay ? (A % range is also ok).
Would buying a "toyota Certified" used car help?

Are there any other aspects I must look into in the buying process?

Answer 1

There are a few things to consider. Interest rates are normally higher on a used vehicle. If it only has 2m-3m miles on it, is the car a demo or a used car? If it is a demo, it has not been titled and is still considered a new car. The manufactures warranty will still apply so that is not an issue. If it is a used vehicle, why has it been turned back to the dealer?(Repo, corp. lease, auction, rental car, etc). You don't know how the previous owner maintained the vehicle especially if it is a repo.

It is true that a new vehicle will depreciate as soon as you drive it off the lot (up to 20%), but if you plan on keeping the car for a few years that won't matter. Some states let you contact the previous owner to ask about the vehicle and the dealer must supply you with contact info if requested.

I have bought both new and slightly used cars and prefer to buy new. However I usually keep the car for 4+ yrs. If I know I am only going to use the car for 2-3 years I would buy used especially if the miles are that low.

Hope this helps in your decision making process

Answer 2

Buying used is generally a better idea than buying new, and I understand the idea of looking for something that's barely been used as a way of taking advantage of the "instant depreciation" a new car experiences when purchased, but in reality I think it'll be hard to put into practice because:

1) Not many people are looking to sell their car after only 2-3k miles, so the supply is very limited.

2) Those that do are probably doing it because they just want something different and prefer to trade it in and get a new one with a dealer and take the loss (since dumping a car this quickly is a bad financial move anyway, obviously the person isn't pinching pennies). Or on the opposite end of the spectrum...

3) Person cannot afford their car payments and need to dump it, but chances are someone in this position is upside down and can't sell it privately anyway, and will rely on trading down with a dealer. Also...

4) People have a hard time believing their almost new car is worth anything less than what they paid for it and will price it accordingly, whereas a savvy new car buyer can save hundreds (if not thousands) of dollars at a dealer by using their negotiating skills. Haggling with a stubborn private seller may not be worth the trouble.

Answer 3

When people buy a new car, they are not buying a new machine. They are buying piece of mind. They are celebrating a stage in their lives when they could afford a new car. They do not look at the price, because either they can easily afford it, or price is not the most important consideration.

When it comes to sell that new car two years later, the owner rarely find somebody willing to pay a high price. Two-year-old cars may sell for a third of the original value. For most other people, price is a consideration in a car. They are not buying reliability or status as the first buyer. Most likely, they can fix minor problems. Therefore, they do not mind imperfections.

You seek a car a few months old, hoping to get a good price. Such idea is not impossible, but it will mean hard work. I do not think you can get such car from a dealer, not cheaply. I am sure a dealer would use his experience to get the most profit from the car. You would have to get it from an original owner, and his story has to be very peculiar. It should be a matter of your effort and a lot of luck.

I heard certified cars exist because of the enormous depreciation used cars get. A segment of the new car market is leased cars. Such leased new cars are used by company executives (who treat them reasonably well), and maintained by the company. After two years of use, the car is sold as used to avoid mechanic bills. The car is thoroughly checked, and then put the certified tag. The car will be in better condition than a two-year-old car used by ordinary people. Whether it is a good buy depends on the price.

Before you pay for the car, have a mechanic check it thoroughly. Ideally, he will tell you if the car has mayor problems, whether you need to fix anything after you buy, and whether you are getting a good price.

Answer 4

As far as Toyota's go, you'll pay close to the same price for a low miles used as you'll pay for a NEW car, so why chance it?

With a new one, you break it in the right way. Gently. Did the guy who had the used one do that? Who knows.

For a little more money, you will have a lot of peace of mind.

Another thing. The only reason someone would trade in a car with 2K miles on it would be they didn't like it for some reason.......it may be a lemon.

Answer 5

I just test drove a 2007 Corolla last weekend. The guy told me to expect 60% resale value after 3 years. That didn't strike me as very good. The base model is $13k but you won't find one on a lot for less than $18k.

For price haggling tips, go to www.edmunds.com. They have something called a smart price, which shows you what the dealer pays, etc. and gives you a number to shoot for when dealing with a car place.

That being said, I agree that it's better to buy an almost-new car that's still under warranty. It's what I'm looking for myself.

Answer 6

Your looking into a real good car. it is defently smarter to buy a preowned vehicle, i have seen cars with low mileage. dont look at the MSRP, that price will always be higher, the price that the dealership will be lower. this makes the customer feel that they are getting a deal, but in fact they are getting the right price. at the average, once you drive a new vehicle off the lot it loses 3 to 6 thousand dollars. some more info about toyota, they are one of the few Makes that make their vehicles in the U.S.A. ford chevy and dodge (american companies) make their vehicles in other countries. toyota (japaness) is made by americans. thats why these vehicles are slightly more expensive then ford chevy and Chrysler.

Answer 7

Yes. It's a good idea, but make sure you look at Edmonds.com and make sure you are paying a fair price. Also, visit your states Attorney General Website. You can learn about consumer friendly laws ans such. Also, make sure that when you are negotiating with the price that you say the price includes everything. Make sure the car is Toyota Certified and not just dealer certified.

Answer 8

I'm not really for sure. But if you don't buy it from a used car dealer ship, make sure you run a back ground check on the car that you're going to buy. Sometimes it's better, other times it isn't because you don't know if there's something wrong with that car. It's a chance that you have to take! Good luck with your vehicle purchase!

Answer 9

i admire your question.. i exchange into thinkin approximately asking tis same question....yet contained in the previous 3 years I even have offered 2 used autos... the 1st one got here with a buncha calling taking part in cards, a %. of cigarettes, loads of plastic luggage contained in the trunk, a handicap decal (the automobile belonged to a pair previous guy who only died) the only i only offered at the instant got here with some tomcats (firecrackers) and little bit of weed and 2 glove booths and a lighter If i purchase yet another used automobile i ask your self what different crap i will locate.