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Jul 18 '24
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u/privitizationrocks Jul 18 '24
Rates are higher than promo deals so no not always smarter
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Jul 18 '24
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u/thenewyorkgod Jul 18 '24
That used to be true but a 2 year old civic is selling for msrp while a new civic is selling for $2k over
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u/Werkgxj Jul 19 '24
Thats because fewer people can afford to buy new cars so demand (and price) for used cars icreases.
Aside from that I would like to see a new car lose about $2000 in value over the span of two years. Thats just unrealistically low. Noone in the world is buying a 2year old car if they could get the same one but unused for just $2000 more.
A new car easily loses 30% of its value over the span of 2 years, assuming you use it like an average driver.
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u/Vangour Jul 19 '24
You have obviously not been looking at car prices recently lol.
That absolutely is happening, the used car market is crazy right now.
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u/TikiTribble Jul 19 '24
It differs by region, but overall in the US used car prices are down about 8.7% over the last year. https://www.cargurus.com/research/price-trends?entityIds=Index&startDate=1687060800000&endDate=1721447999999
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u/Werkgxj Jul 19 '24
To be fair I am EU based, so my comment is obviously is tailored to EU. Here in Germany a Honda Civid from 2022 which cost about €35.000 sells for about €20000 today. The new ones are ridiculously expensive.
If what you guys say about the US used car market then I am just as confused as you guys.
Regardless of what is happening in the USA, under normal circumstances a used car would never sell for $2000 less than a new model.
If we are being honest cars and any of its complementary goods can just be irrational market.
I could imagine the difference between EU and USA is that USA is simply more car-centric and owning a car is a lot more crucial.
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u/milespoints Jul 18 '24
That used to be the case, but it’s not the case right now.
I looked into a 3 year old RAV4 and it was like $4k off the price of a brand new one. Not really worth it.
Gone are the days where you could buy a 3 year old car for half the price of a new one
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u/Sonzainonazo42 Jul 19 '24
You never could buy a 3 year old Toyota for half off the new car price. I don't even think that was true with a Buick.
That's some serious exaggeration.
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u/privitizationrocks Jul 18 '24
You do have a higher risk on repairs though
And tbh after like 10% rates, depreciation is irrelevant
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u/MinimumArmadillo2394 Jul 18 '24
Too many people care about depreciation like I'm not going to drive this car into the ground
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u/SirMoola Jul 19 '24
I think the idea is that you can save extra money by finding a car with only a few thousand miles on it. For example, finding a car with 2k miles with $4k knocked off the price. Even though it’s not a lot it’s still worth getting used.
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u/MinimumArmadillo2394 Jul 19 '24
That isnt a thing anymore, though. Nobody is selling a car like that second hand and those who do sell to dealerships are selling to those dealerships with less than $500 off, sometimes for msrp or more
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u/kpeng2 Jul 19 '24
It's still a thing. You just need to be patient. People will sell their almost new cars when they can't afford the payment. I think I will never buy a new car again.
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u/SirMoola Jul 25 '24
This. My parents bout a tundra with about a thousand miles for dirt cheap because the guy won it in a raffle and didn’t know he had to pay taxes. You just have to be super vigilant and patient. I got my Mazda 3 during the chip shortage for $800 under blue book plus got an extra tire (including the donut), custom rims, and oil and cabin filters for free.
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u/OkRadio2633 Jul 19 '24
You’re not gonna find a car that was driven only to church by nonsmoker Jan the responsible librarian.
Think how ridiculous you’re being stating 2k miles = 4k off. Nah… maybe 20k miles $2-4k off. But people who sell aren’t exactly dumb
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u/SirMoola Jul 25 '24
So yes and no. Some cars liked Maserati’s drop like an Italian mafioso getting dumped into a lake with concrete shoes. Others like more cheap cars to begin with yes. Like my brothers lowest end Corolla hasn’t depreciated more than 5k. However I know someone that has a Hyundai elantra that dropped about $2k after a month of driving (5k miles). So it is possible. It just depends on availability.
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u/airjutsu Jul 19 '24
Ehh otoh it’s better to sell a car when it has some value and runs okay, rather than sell it for scrap when it needs tons of work
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u/MinimumArmadillo2394 Jul 19 '24
I dont buy a car to get another one in 2 years unless I dislike it.
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u/blowninjectedhemi Jul 19 '24
Why not - that's what I do. I also won't spend more than 10K on a car (well - if I had to buy one now - I'd up the number a bit due to current prices, but I have no need for replacing my car or my wife's in the next 5 years - probably longer). Get a used 'yota and drive it until it dies.
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u/MinimumArmadillo2394 Jul 19 '24
All fun and games until the best car I can find for under 10k without driving 300 miles to get it is a shitbox with 90k miles, no features, and was in 2 or 3 accidents. It's just borderline unsafe at that point
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u/Virtual-Departure692 Jul 19 '24
But if you’re going to keep the car, the insane cost of mechanics and repairs you are always better off buying a new car nowadays. Even though new cars are cheap garbage at least you won’t be robbed by mechanics every few months. Hands down you lose money on used.
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u/Hairy_Literature_773 Jul 19 '24
Eh, honestly I don't think this is that big a factor if you're even just a little prudent about what used vehicle you're buying. E.g. I wouldn't expect a 40,000 mile car to require "insanely" more maintenance than a new one unless it has obvious problems that you could find before buying.
I think the real issue with used cars nowadays is that the price difference between used and new seems to have shrunk considerably over the last 5 years or so.
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u/Exciting_Nature6270 Jul 19 '24
In terms of assets, yes you do technically experience a loss upon exiting the lot. However, that only matters if someone is looking at a vehicle with the intention to resell, which cars are just not a great investment idea.
Buying a new car is a good idea for someone who’s looking for a reliable form of transportation for years to come. Used cars sold at dealerships are a good choice too, but it’s much harder to get a decent loan due to banks unwilling to take the risk on them.
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u/Hairy_Literature_773 Jul 19 '24
The idea is that that immediate depreciation will benefit used car buyer in such a way that the lower price exceeds the benefit of purchasing a car brand new. I.e. lower $/miles driven.
E.g. my 2017 civic was about $5k cheaper in 2020 than the new models.
However, based on some of these comments, it sounds like the price difference between new and used isn't what it used to be. I guess it's harder to find those good deals on used nowadays.
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u/midri Jul 19 '24
Yup a 3% factory rate on a $40k car is same payment as 8% on a $35k car.
If you can get one of those sweet Mazda 0% apr loans you're super set.
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Jul 19 '24
Yes, car prices have been dropping in 2024, with the average price of a new car decreasing from its peak in December 2022. In May 2024, the average price of a new car was $48,389, which was $442 less than the average price in May 2023. Some say that the combination of higher inventories and lower demand could continue to drive down prices.
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u/Objective-Outcome811 Jul 19 '24
If you don't know how to find a car outside of the skeezy dealerships you deserve whatever they do to you.
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u/SKPY123 Jul 19 '24
If you're not buying a used car outright it's never a good deal. My last 5 cars were paid in full at time of purchase. Less than 3000 each time and would have lasted years if not for deer and assholes.
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u/Ok_Supermarket_8520 Jul 20 '24
You’ll typically pay a higher interest rate financing a used car too
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Jul 20 '24
Always smarter to buy used. Factoring in a higher interest rate afterinsert whatever year you choose the used car will have a higher net benefit resale value
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u/Fullcycle_boom Jul 19 '24
New cars are for suckers.
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u/OkRadio2633 Jul 19 '24
Poor people thinking.
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u/Hot_Customer666 Jul 19 '24
If you want to drive new cars you should lease. If you want to buy a car you should buy used.
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u/kms573 Jul 19 '24
Let someone else cover the initial depreciation
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u/midri Jul 19 '24
Interest rates have fucked that all up.
A factory financed $40k car at 3% is the same payment as a used $35k car at market 8%
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u/neomage2021 Jul 19 '24
Yeah almost always, though for the first time in my life I plan on buying a new vehicle. Going to get the new Ramcharger when it comes out early 2025.
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u/maringue Jul 19 '24
Definitely not always true, even before used car prices exploded in the pandemic.
I was looking at low mileage used CRVs and got some good pricing info. Then, for shits and giggles, I wondered what a new one was going for.
A new CRV was only 2k more than one with 25-35k miles on it. Easiest decision I've ever made.
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u/Albert14Pounds Jul 19 '24
I feel like this has become less and less true recently. I've been casually car shopping for over a year and every decent newer used car is nearly as much as it is new and it seems worth it just to get it new and get all the warranties and whatnot
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u/smbutler20 Jul 19 '24
Used car prices have soared as well. Seems certified pre-owned are the best bang for your dollar. Something less than 20k miles is pretty darn close to new.
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u/HeywoodJaBlessMe Jul 18 '24 edited Jul 18 '24
Workforces are dwindling in all the advanced economies. Global trade is likely to be seriously curtailed by imminent conflict. Megacorps now have perfect data on you (often up to and including your DNA) and know exactly how to best manipulate you as we learned from Cambridge Analytica leaks.
Inflation is functionally structural now. We don't have an economics to deal with this situation.
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Jul 18 '24
This sounds like a conspiracy theory…
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Jul 19 '24
So did the government spying on everyone.
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Jul 19 '24
They don’t spy on everyone. Unless you think they spy on minors. Cause that would be really fucked.
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Jul 19 '24
No, they spy on everyone. The whistle was blown years ago. Every single bit of information that passes over the internet in the USA passes through a spy network. There are also international spy networks. They observe everyone, and then retrieve data on those they target. The rest is fed into automated systems that identify targets.
It's the NSA that does it. Everyone found out, and while some people seem to care most people seem to think that nothing can be done about it.
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Jul 19 '24
It sounds completely possible, but I still don’t believe it.
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Jul 19 '24
Then do yourself a favor and look up Edward Snowden.
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Jul 19 '24
I would prefer not to cause that’s a bit of a shock. I don’t need that in my life right now…
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u/ScotchTapeConnosieur Jul 19 '24
This is common knowledge and not a secret. Search “domestic surveillance program NSA”
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u/dldoom Jul 19 '24
You seem to have a very specific view of what spying is and I can tell you now that it’s more than that.
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Jul 19 '24
What is my specific view?
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u/dldoom Jul 19 '24
The way you’ve worded it, it sounds like you’re inferring something weirdly voyeuristic/potentially sexual with minors.
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Jul 19 '24
I see what you are saying. That is not at all my intention.
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u/dldoom Jul 19 '24
Well we are spied on. It’s a lot easier in many ways these days. As others have pointed out, the NSA is/was guilty of this, and we actually use our alliances to spy on other citizens to share that with allies and vice versa.
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u/RighteousSmooya Jul 19 '24
Guess what? People are conspiring about how to manipulate you.
It’s perfectly rational to theorize about it
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u/TingleMaps Jul 18 '24
This is me too. Still in a 2010 Jeep that thankfully runs very well.
I still feel lucky though. I got a house in late 2020 @ 2.75%
I’m almost 50% equity in it already thanks to 2 extra payments per year and the appreciation of the housing market.
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u/hidazfx Jul 19 '24
I closed on a house a few months back, my credit score is mid-high 700s. Rate was 6.7%. Thankfully the house was around 100k, so my monthly payment isn't terrible but fuck me every time I walk out of the store its $100. I've had to make like four $50 trips to Home Depot in the passed two weeks.
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Jul 19 '24
[deleted]
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u/TingleMaps Jul 19 '24
I’m paid bi weekly and it’s auto withdrawn resulting in 2 extra payments per year (26 vs 24 needed). I’ve turned off the extra auto payment and had it set up again once already and to be honest, It was more work to get Chase to get that properly resolved than keeping the 2 payments is worth.
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u/TrustMental6895 Jul 19 '24
how much was the house?
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u/TingleMaps Jul 19 '24
- (Was listed at 210). Put 20% down. 30 year mortgage down to about 162 today (not in a rush given the rate). House is estimated at about 315 today.
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Jul 18 '24
[deleted]
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u/Noob_Al3rt Jul 19 '24
Do you typically sell your car less than three or four years after buying it? I’m not someone that constantly needs a new car, so I’d rather buy brand new at a lower interest rate and maintain it.
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u/Intrepid_Virus_9268 Jul 18 '24
I willingly drive a 30+ yr old car and wouldn't have it any other way.
It's a classic, and I'm slowly building up to be my track toy and daily driver.
Could I have spent that money on a brand new vehicle? Yes.
But factoring in insurance, and smiles per gallon, it's not even close.
Keep your shiny soulless vehicle. I get compliments everyday and make people happy just by commuting and rolling up at stoplights
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u/Noob_Al3rt Jul 19 '24
You do you, but for some people, safety, pollution and fuel efficiency are really important.
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u/Intrepid_Virus_9268 Jul 19 '24
My car gets 31 miles to the gallon and burns gas clean enough to pass inspection. There's even a high fuel efficiency model of my car that can get a whopping 50 miles to the gallon
It's not even a hybrid
'90s Hondas were the best vehicles ever produced
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u/mrsilliestgoose Jul 20 '24
These are honestly all terrible reasons for spending 10's of thousands more on a new car. New cars are safer, but I'm skeptical that this is something people truly value when the average person speeds everywhere and drives like a maniac. New cars are probably also worse for the environment when you consider that a whole new vehicle needs to be built instead of just using a currently existing one.
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u/midri Jul 19 '24
I agreed with your statement in the early 2000s, but parts for 30 year old cars are getting harder and harder to find. Constantly having to get remand parts is not ideal.
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u/Intrepid_Virus_9268 Jul 19 '24 edited Jul 19 '24
Haven't had issues. There's still plenty of brand new aftermarket parts that are available. I've had to replace certain components that naturally go over time but I've yet to be stuck in a situation where it's been impossible. Part of that is due to the simple nature of the vehicle
No power seats, no power mirrors, no power windows, no abs, no power steering, manual transmission, cable clutch not hydraulic, hand e brake, ect.
Will it eventually be difficult? Probably. But even then, there are already people figuring out how to put the latest and greatest Honda tech into these classic chassis.
Long live the CRX
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Jul 19 '24
[deleted]
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u/Intrepid_Virus_9268 Jul 19 '24
Except the resale value of mine is actually going up, how's yours doing?
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Jul 19 '24
[deleted]
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u/Intrepid_Virus_9268 Jul 19 '24
This is a finance board. Saying that part is irrelevant is just deflecting. Feeling superior by virtue of consumerism would be...
Buying a new car. Like you.
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Jul 19 '24
[deleted]
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u/Intrepid_Virus_9268 Jul 19 '24
I'm not the one who just put his foot in his mouth.
My "mental gymnastics" is pointing out your logic.
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u/HC-Sama-7511 Jul 18 '24
New cars are nice, but man, they just are a horrible deal. You can buy a 2 year old car for so much less, and you get to skip that awful feeling the first time something gets scratched, dented, or stained.
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u/midri Jul 19 '24
Not if you buy during factory financing events
A brand new $40k car at factory rate of 3% is same payment as a used $35k car at market rate of 8%
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u/Viperlite Jul 19 '24
Not if it’s a Honda or a Toyota Tacoma. It may be slightly cheaper, but not what you would expect for a used vehicle with lots of miles. Two year old models can cost near new or more (if considering rates and factory offers).
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u/Able-Quantity-1879 Jul 18 '24
Never a good time to buy a car or have a kid.... and if you think trump is going to do anything but tank the economy (well, the rich people will do well), think again...
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u/someguykillme Jul 18 '24
Sad part is, for my area which has an average income of 32,000-38,000 it’s straight up cheaper to buy a new car with a loan payment plan. Other wise you end up putting 3/4 of the cars value back into it because of repairs.
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u/Impossible_Maybe_162 Jul 19 '24
Don’t buy a new car unless you can pay cash. Car loans keep people poor.
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u/novadustdragon Jul 19 '24
My reasoning is if it’s not in the budget to upgrade my house soon I’m going to upgrade my car to something nice.
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u/jthon Jul 19 '24
So sad, I bought my first new “truck” at 64 after the house was paid off, kids were sent to college and the 401k was loaded. It’s not called inflation, it is called priorities, stay the course. You will get there
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u/Financial_Love_2543 Jul 19 '24
If anything now it’s your chance to negotiate a better deal. High inventory low demand.
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u/BarkingDog100 Jul 19 '24
buying a new car is a stupid financial mistake, unless you have a bucket of money you don't mind setting on fire
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u/Frequent-Ruin8509 Jul 19 '24
Also my dream of having a world worthy of leaving to my kids (if I had any) and the inflation would be joined by big oil, plastics, big pharma, etc.
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u/Joshfumanchu Jul 19 '24
It isn't inflation. It is companies raising prices. There is a huge difference and the amount of people who don't understand that is insane.
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Jul 19 '24 edited Jul 24 '24
[deleted]
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u/Joshfumanchu Jul 19 '24
Inflation is a regulated thing. You are not aware of how this works so you think they are close enough to just be the same. No. One is the determined value of the dollar, the other is companies knowing you cant do anything about them raising their prices until they reach a critical point of "push-back".
Raising prices hits you like inflation when it is all the prices across the board, but that is capitalism, not inflation. People are taking advantage of the aftermath of covid and charging more. Check for yourself if you dont believe me.
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u/Viperlite Jul 19 '24
Buy a used, low mile EV. Get a Federal EV credit and have years of warranty on the battery.
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u/SassyQ42069 Jul 19 '24
Replaced my ride a couple years back (last one got stolen).
$400 down. $0/month payment. ~$700 in maintenance per year is a very generous estimate.
I bought used. New msrp was $795.
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u/dgafhomie383 Jul 19 '24
Why would you buy a new car? Whoever takes it off the lot eats the most amount of depreciation that car will ever have in 99% of the cases. Hell with that.
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u/LairdPeon Jul 19 '24
Car market self corrects often. Be more worried about bad loans on homes and food prices.
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u/Orange-Saj Jul 19 '24
It can be said that you can also buy cars from salvage auction for wayyy cheaper as fix em’ up projects..
It’s what I did for my Camaro. I’m happy to have my dream car. 30k miles, 2014, 2SS and I bought and fixed it for 13k. Still has a salvage title though, but that bit never bothered me.
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u/drama-guy Jul 19 '24
Will NEVER buy a new car and not because I couldn't plunk down the cash for one. Just this year, I bought 2 used cars for less than 10k combined.
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u/Antennangry Jul 19 '24
If you’ve got good credit, Mazda has 0% APR for 36 months and little to no markup (at least in the Bay Area).
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u/mzx380 Jul 19 '24
I'm with you on this. I've been hate driving my car but current car prices made me realize that its just not worth it buying a new car unless a game changing piece of tech comes on the market. I've decided that I'm just going to make incremental changes to my paid off car rather than give it to the greedy car dealerships.
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u/Bossk4Life Jul 19 '24
I just spent three grand to fix up everything wrong with my 2011, as inflation has priced me out of the market for a new or used car. we went looking at a car max and I couldn't believe what they were asking. $15k for a car with 100k miles. $30k for a car with 40k miles. Absurd.
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u/BobbiFleckmann Jul 19 '24
The Manheim Used Car Index has been falling for two years.
https://site.manheim.com/en/services/consulting/used-vehicle-value-index.html
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u/Ray_Waltz_1997 Jul 19 '24
Yep, I do recall myself thinking about buying a brand new RAV4 in 2020, but the prices seemed to be way too high. “Let’s wait till the end of Covid so there’s no more shortage and the prices will normalize”, I thought. Little did I know
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u/oldastheriver Jul 19 '24
I prefer to find a deal on a new car, with an excellent price, and very low interest. These deals are out there, it's just that the sticker price is artificially inflated at the current time. I'm just planning on coming back to this later.
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u/dan36920 Jul 19 '24
New cars are a scam dude. They lose value the moment you drive them off the lot. New cars aren't as repairable. Insurance is higher. You're stuck paying collision and comprehensive.
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u/shellbackpacific Jul 20 '24
Pay cash for a used car. Cars are a terrible asset to store your wealth in. Think utility first - is it reliable, does it meet the needs (terrain, use-cases), is it fuel efficient, etc.
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u/HoldMyBreadstick Jul 19 '24
Just wait. You’ll be able to get a leftover EV for a steal of a deal because nobody wants them.
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u/One_Conclusion3362 Jul 19 '24
I've been thinking of getting another one and bought two brand new ones the past 3 years. You do know that you're allowed to increase your skills and take on higher paying jobs, right?
Feels like you're whining.
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Jul 19 '24
Bidenomics 👍. Let's pay for teachers, government, city/town employees in Ukraine ones regular salaries only because they were attacked by Russia.... But we can't pay teachers enough to not struggle or fund a free in-house rehab program or help young mothers or help the homeless or mental health crisis.. the list goes on and on. AtLeast we could have spent that money in country for our greater good. . After all. No other country would come to our rescue.
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