new or second hand car?

L

Lumpsum

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I need to replace my car soon and am weighing up whether to buy a new one or a relatively recent vintage (one to three years old) second hand one. I could afford to get a new one at a slight stretch - will be going for a 1.6 - 1.8 litre family saloon.

But the book depreciation of a new car in year one always looked very high to me, and I wonder is it financially wiser to go for a newish second hand one. Has anyone any thoughts on the pros and cons?

Apologies if there is already a thread on this topic but I searched and couldn't find one.
 
My view is second hand.Modern cars a pretty reliable if looked after properly. As you've said new cars lose alot in the first few years. There seems to be a glut of second hand cars around at the moment (due to ssia money?) pushing down values, e.g. this thread. If you're looking at 1-3 year old, I would probably buy off a dealer with a warranty.The only reasons I can see for buying new are:- plan to keep the car for a long time- will be doing very high mileage (similar to above)- or want a very specific type/size/colour/spec
 
I'd also go for second hand over new. They say you lose at least a couple of grand once you drive it out of the showroom. As much as I 'd love a new car, paying that kind of money would kill me. That said, if you got a really good deal on a trade in maybe it would be worth your while, but it's unlikely it would be enough. Good luck with your car shopping!
 
depends on your need and the deals available, for example I needed a new seven seater, wanted to keep it for five plus years and wanted reliability.

enter Nissan seven seat pathfinder SUV, €60K in Jan, dropped to €48k by April (Nissan Ireland promotion), get a dealer keen to deal (double "trade" trade in value) and I got a nice new '06 SUV for €42k (30% list discount)

That's the way to buy new...

Did
 
Lumpsum,
I would go for the second hand option, well in fact I have.
I bought a 04 in February.

There are 2 trains of thought on this:
1. Buy a new car and trade in every 3 years.
You always have warranty cover and the likelyhood of an issue is small in comparison to an older car.
You always have a new/newish car.
However, I believe it costs more in the long term.
(This is a gut feeling as I haven't done a complete cost analysis of the whole thing.)

2. Buy the 2/3 year old car and drive it in the ground so to speak (until it is at least 10 years old).
Short warranty cover and obviously the older car will encounter more mechanical issues.
You will not have a new car.
However, I believe it costs less in the long term, hence I bought a 04 in February.

Another angle on my decision to by a second hand car is:
Say you have €20,000 to spend, what is your preference;
a 03 Volvo S60, 04 Audi A4, 05 Ford Mondeo or a brand new Ford Focus, Skoda Octavia, Volkswagen Golf?
You know my answer.

Apologies if this has been long winded!
 
GoCall01,

I think that sums it up very well, however an important thing you need to consider is the higher trade in value that garages will offer against the purchase of a new car.

A friend of mine bought a brand new Peugeot 206 in 2004. Everyone said he was mad at the time, losing 1000 as soon as he drove it away, massive depreciation in the first year etc. However, a year and a half later, he traded in that car against a brand new VW Golf. He told me he lost about 1500 euro on the 206 over a year and a half, and was very happy with himself.

So the offers that garages tend to make on new purchases of new cars will affect the figures - another way of looking at it is that you should never pay full list price for a new car...

Personally, I would tend for the 3yr old car, and run it for as long as possible.
 
New are poor value - the minute you drive it out of the showroom the value will have dropped by 10%+
 
I was on those people who purchased new every three years.Actually it was every 2 years at one stage but around the mid 90's I dropped back to 3. My reasons were exactly as stated above , warranty, reliability etc and no real costs. 4 years ago I sold my 99 corolla privately to a friend ( fleet transport manager with a largish fleet of cars on road) . As he was driving off he told me that in his opinion I was mad to sell. The price was fair and I had cash to go and buy a 02 model corolla. When I asked him why he thought so he said that he had thoroughly examined the car before buying and couldnt find anything wrong with it. in fact he checked with the local toyota dealer if I had replaced the brake pads as he thought they were too good for a 3 year old with 40,000 on the clock! Tyres were still the original and spare never out of boot. he also said that in his opinion the ('99)motor would be as good 3 years down the road as my 02 motor. changing circumstance ( two in college) and a rethink of 'strategy' made me decide that I would keep the 02 car for 5 years and sell it on with 1 year nct still to go. However I am rethinking again. The car is as sweet as a nut, sailed through the nct ( barring my own stupid fault for not checking the lights) without any work whatsoever, is on fairly new tyres ( changed at around 48,000) and I am just wondering why should I change it at all. I might just wind up with somebodys elses problem car. One thing I have decided for sure is that I will not be buying a new car again. Once I got out of the mindset that I 'needed' a new car every 3 years it, I have decided never to return to it. Long winded answer = second hand.
 
cuchulainn said:
Once I got out of the mindset that I 'needed' a new car every 3 years it, I have decided never to return to it. Long winded answer = second hand.
Click to expand...

Thanks for sharing that story, it's interesting to read how you changed your mind. I've never quite understood the "trade it in every 2 or 3 years" option myself and it seems a sure-fire way of losing the most possible from depreciation. Interestingly a friend traded up earlier in the year (3 year old car to brand new one) "before the depreciation got too bad", i ran through a few figures etc but in the end i am of the opinion most people believe what they want to in order to justify the 'new' plate to themselves.

Like anything it depends on your means. As my own have improved i still buy cars in the 3-5 year old bracket but have simply moved up the scale to better models.
 

Just bought a new car few months ago....
Went to visit few dealers to show my interetest. Then I organised a phone auction between these main dealers. You have to try this to believe by how much the price dropped and very very quickly.
So pick up a brand new 06 for cheaper than a second hand 06 and very close to the price of a 05.
 
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