James' Car

[Nick F]

Whats the problem with cars these days? The cost that they drop over the first year.

James who does our performance testing brought a Seat Ibiza for 14k a year ago. the car is now worth 7k what do you think about this?

Do you think he was ripped off? Your views please.

[Stoo]

Did he not bother to research? You can find out depreciation levels easily enough, but bare in mind you tend to lose about £2k as soon as you drive it from the showroom, and combined with the fact that it's a Seat, I'm hardly surprised..

Also, this is in the wrong forum, so I'll move it the a more appropriate location

[atrull]

Heh.

I'm always suprised young folks buy new cars in this country, since it is such an ideal second hand car market - perhaps the best in the world, and you can buy some very exciting cars for alot less than a new boring one.

[Funkstar]

Depreciation is worse for some cars than others. But generally (especially if you are trading it at a dealer) you will loose about 50% in the first three years. Also when people say "in the first three years". What that often translates too is "if the car is traded in at any point within the first three years". For comodity cars, to be honest, i'm not surprised at the reduction in value.

For other markes, such as Audi the residual is higher and a bit more relaistic. Personally i believe this is down to the fact that they don't do special deals on new cars. You generally pay list price for them and the only room for negotiation is on the trade in on your old car. This has been the case the last twice when hy dad has been upgrading his Audi, he has been offered a fair price for his existing car, but they will not budge on the end price at all.

I'm reluctant to buy a new car at all now, personally i think it is a very big waste of money. Especially when cars are built so well now, a good car will last for years.

[dave87]

Yup, new cars lose a lot in the first three years - take the 52 volvo v70 my rents have, it was 26-28k new (can't remember the exact figure) and its now worth 16 tops (in immaculate condition, low milage etc)

The only exception I know to this rule is a Porsche, which dont drop soo much, but still drop

[Nick F]

Heh, I posted this in a bar with David and Paul in central London

Don't you just love 3G data cards.

[5lab]

some cars dont drop so much, others do. i picked up a (just) 6 year old mondie for under a grand - the car cost £16k when new. that means it has dropped 93% of its value in 6 years. yeah he was stupid to buy a new car, but thats life. check the value of cars on parkers.co.uk

[Fox]

This is basically the problem with buying a brand new. The first year depreciation really is utterly savage which is why it's virtually impossible to make a financial case for purchasing a new car.

Gone are the days when second hand cars were liabilities and it was pot luck whether you got a good one - these days, cars are reliable and all manufacturers run approved used schemes which means you can buy a car at used car prices but still have the balance of the manufacturers warranty, or a years warranty if it's not under manufacturers warranty.

Same trouble-free motoring as a new car, simply without the thousands and thousands of pounds shed in depreciation.

Depreciation is assumed to be a bad thing - not always the case. Use it to your advantage, it can be your friend. I could never spend £20,000 on a car @ 19 as a student so instead I bought a £20,000 car @ 4 years old for less than 20% of its new cost. It's still the same car it was 4 years previously, with the same stuff, only it cost a fraction of the price.

Depreciation. Isn't it great? My next car will be a £36,000 executive saloon. Will I spend £36,000 on it? Nope. I won't even spend a third of that..

[Butuz]

Lol - losing £7k in one year is just pure idiocy.

Thats why I bought my 10 year old car for £3k and a year down the line i could have sold it for £2.5k at least, 3 years down the line, i may still be able to get £2k for it.

Your mate wasnt ripped off, he just needs to use his noggin a bit more than he does.

Butuz

[GJUK]

I never even bothered looking a new Cars....you lose enough on 2nd hand cars..it even worse with new cars
I bought a K reg rover coupe was 6 years old whan I got it (september 1999) sold it last year for £600 (needing a lot of work to keep it going) I paid 5k for it so that not to bad as that was 6 years later.......I wonder how much the impreza I would lose over 6 years??


GJUK