Used vs new – Let’s settle the debate.
Deciding whether to buy a used vs new car can be a difficult decision. Your budget may not allow for a new car, and price could be a significant factor. However, some argue that used cars may not be as reliable as new ones.
To help you make an informed decision, let’s explore the advantages and disadvantages of used vs new cars.
Used car advantages
Purchasing a used car can come with many advantages including but not limited to:
- Lower cost – Used car prices and used car finance are typically more budget-friendly than new cars. Discovering a dependable used car at a much lower cost than a new model is expected to save you money.
- A wide choice to choose from – The variety you can choose from is dependable on your preferences. Knowing what you are after—e.g., a compact car just to drive short distances, easy to park, and small engine size—you can then narrow it down to models that offer this. The used car market offers many different models and at many different ages, which gives you more flexibility than the new market.
- Available immediately – New cars often require ordering and waiting for delivery. Whereas used cars are usually ready for immediate purchase. This allows you to choose a car and drive it home right away without any delays.
- Lower insurance costs—This depends on the market, as insurance costs have risen recently. However, a car that is several years old would typically be cheaper for insurance than a brand-new version of the model.
Used cars offer many advantages, especially for those in the market for their first car. It would be practical to purchase a reliable but older, cheaper-to-run car while you are getting used to driving before making a big purchase on a new car. If you commute to work via train or bus but need a car for weekends or the odd errand, a used car is a more financially sensible option.
Used car disadvantages
- Possible mechanical issues – Used cars might come with signs of wear and tear or hidden mechanical problems that may not be obvious. It’s essential to be aware of this as it could result in unforeseen repair expenses shortly after buying the car.
- Higher interest rates – When financing a used car, you might encounter higher interest rates since lenders view them as riskier investments than new cars.
- Unknown history—Evaluating the maintenance history of a used car when you don’t have access to all the information can be challenging. This may impact your ability to determine how well it has been taken care of or if it has been in any accidents.
The outlook is that used cars typically cause more problems than they are worth. It’s not only those cars up to 10 years old that may show mechanical issues; it can happen to a car at any age.
New car advantages
- Warranty—New vehicles include extensive warranty coverage, which offers reassurance and safeguards against unforeseen repair expenses for a specific duration or mileage.
- Lower interest rates—Lenders will typically offer lower interest rates on new car finance, as there is less risk associated with it than on used cars. Frequently, you will see low interest rates at car dealerships that engage you in a new car purchase.
- Customisable—When buying a new car, you can customise the vehicle to your preferences. For example, if you want tinted windows, heated seats, or better trim, the choices are yours as you will be the vehicle’s first owner.
New car disadvantages
- Fast depreciation—New vehicles tend to lose a significant amount of their value within the first few years of ownership. As soon as you drive a new car out of the dealership, it’s worth can drop by thousands of dollars, which can negatively impact your investment if you decide to resell or trade it in the future.
- Higher costs—New cars usually cost more than used cars of the same make and model. This may make them too expensive for some buyers or require a larger down payment or financing amount. At times, there may be options for a £0 deposit, but this usually results in higher monthly payments.
- Long waiting times – Being the vehicle’s first owner means there will be longer waiting times to produce the vehicle to your customisation. This can be a matter of a few weeks or even months.
- Insurance costs – New vehicles frequently have higher insurance premiums because of their increased value and the requirement for comprehensive coverage to safeguard against damage or loss.
Ultimately, your decision to buy a used vs new car will be influenced by your budget, preferences, and priorities. If you highly value having the latest features and warranty coverage, a new car might be the best option.
However, if you are more focused on saving money upfront and do not mind the possibility of higher maintenance costs in the future, then a used car could be a more suitable choice. It is essential to conduct thorough research and consider factors such as the vehicle’s history, condition, and resale value before making a final decision. Use our guide to choosing your dream car for more guidance!
