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How to Decide Whether to Buy a New or Used Automobile
For many of you, the choice between a new and a used automobile is a question of budget rather than preferences. Most people if their funds permit would choose to buy a new automobile with a guarantee on parts and labor rather than a used car with an uncertain history. However, upon a closer investigation of the merits of buying new or used cars, the balance in favor of the new cars is not so clear-cut.
One factor that many of you don’t consider is depreciation. Each year your new car depreciates, i.e. loses value, and this drop in value per year is more marked in new than used cars. For example, if you buy a new car its value can depreciate by as much as 75% should you hold onto it for three years. Additionally, you are sometimes charged more insurance and taxes on new cars.
Depreciation and extra costs should however be offset about against the savings you can get through discounts on the purchase of a new vehicle and the greater security that comes with its warranty. Warranties on new cars are always worth more than on used cars, and if you are buying a used car from a private individual you have no guarantee beyond their word.
Other factors to consider are that when you are buying a new model, you are taking a bigger chance than when you buy an automobile that has been on the market for a few years. Older models have their reputations while new models remain unproven. Buying a new car is no guarantee of getting a qualify product since it is not unknown for some used cards to be more reliable than new cards. On the other hand, only by buying a new automobile can you be certain of how well the car has been looked after.
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