Looking for Used Cars? Three Things You Should Know
According to a new article in USA Today, pickup trucks fare best when it comes to depreciation of value over time, and, perhaps surprisingly, luxury vehicles are the worst when it comes to retaining value. The study, conducted by CarGurus.com, examined the going prices of used cars from 2008 to 2012 model years, over a period of one year from 2013 to 2014. The median loss of value for all cars over this period was 9.8 percent.
Among the top contenders were the Ram pickup, the Nissan Titan, and the Chevrolet Silverado. The cars that lost the most, on the other hand, included the BMW 3 Series, the Cadillac SRX, and the Mercedes-Benz E Series. Langley Steinert, the founder of Cargurus.com, explained that part of this discrepancy is due to what people ultimately look for in used cars — low mileage. Luxury cars tend to have add-ons that don’t hold value over time. “When used car buyers go shopping they don’t care about (fancy) wheels,” Langley explains.
It’s worth pointing out that these findings aren’t likely to have much impact on the luxury car industry — people who can afford higher-priced cars typically are not too concerned with depreciating value down the road.
Knowing what to look for when buying a used car will depend on several factors. What you require the car for, your budget, and what sort of features you prefer will all impact what becomes your number one choice. Here are three things you should keep in mind.
1. Have Good Auto Mechanics Look Over Your Would-be Car
To begin with, you should always get a history report on any vehicle you purchase used: that should be a given. Did you know that 50% of cars damaged by flood water — which can cause long-term corrosive damage to internal parts — end up back on the road? Don’t end up with a nice looking car with a gnarly story just under the hood. Furthermore, it’s ideal to have a good auto mechanic inspect the vehicle before you sign on the dotted line. You never know what the past owner might have tried to hide before trading it in.
2. Ask About Dealer Incentives
If you’re buying a used car, your choice of dealer incentives might be a little more limited. However, there are still likely to be several valuable offers depending on your situation. Students, for example, frequently receive $500 to $1,000 off their vehicle purchase if they buy during the right month. You can also trade in your old vehicle and use the money toward your new vehicle. Just make sure, in this case, that you’re receiving a fair amount for what your old car is worth.
3. Used Cars are Usually Cheaper
You might be wondering what the advantage is in buying a used car instead of the cheapest new car you can find. Again, it depends on a wide range of factors. If you plan on doing serious commuting, a new vehicle might be wise so that you can rack up the mileage without anything falling apart. On the other hand, people on a budget are drawn to used cars because they can be 30% to 40% cheaper than their new counterparts, in addition to typically landing lower insurance rates.
Do you have a good auto mechanic on board to check your used vehicle? Let us know in the comments.
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