“New vehicle price inflation has all but disappeared in 2023.” – Rebecca Rydzewski, research manager at Cox Automotive.
Since the pandemic, used and new car prices have been going through quite an upheaval, due to everything from inventory shortages to microchips not being available. 2023 has seen some stability as inventories increased and prices slightly decreased in both markets. It is still valid to question whether you should purchase new or used.
Pros and Cons of Buying New Versus Used
Consider this list. Note that the pros of purchasing a new car will be the cons of purchasing a used car and vice versa.
The pros of purchasing a new car:
- customizable purchases
- better loan interest rates
- up-to-date safety features
- lower maintenance costs
- better reliability and no surprises with previous driver history
The cons of purchasing a new car:
- higher purchase price
- faster vehicle depreciation
- more expensive insurance
Steps to Take
Once you decide whether to buy new or used, the real fun begins. Here is are some things to do before buying:
- Consider true costs, and prepare a budget. These include registration, insurance, fuel or charging, maintenance and repairs, and depreciation. All of these items should be considered when determining how much you can spend each month on a vehicle.
- Choose the cars you want to consider. The best scenario is to have more than one vehicle in mind. Take them for a test drive without committing to purchase. Check reliability ratings and warranty coverage for the ones you like.
- Consider a pre-approved loan. This will simplify your purchasing process and speed up the time at a dealership. One note worth mentioning is to avoid loans over 60 months if possible, as the increase in interest is generally not worth the reduction in monthly payments.
- Get a price point for your trade-in. Most people have a vehicle they are trading in. Make sure you have a good understanding of your current car’s value before you begin negotiating at a dealership to ensure you receive a fair value.
- Ask the dealerships for the best possible out-the-door price. This eliminates any surprise add-on fees. It includes any extras that the dealer may unexpectedly tack onto the price of the vehicle and gives you a way to compare prices across dealerships. The key here is to not give in to the pressure car salesmen often put on potential buyers to make a decision immediately.
- Pick the best deal, and sign the paperwork. Arrange a time to finalize the paperwork. Most dealerships will place a courtesy hold on a vehicle for a few days once you declare intent to purchase, so don’t stress over getting there immediately. Remember to be firm about the out-the-door price that was already agreed to earlier.
With careful planning, buying a new or used car can be less painful than you thought. And don’t forget to enjoy the process!
©2023 Amplified Life Network
