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Recently sold a 2008 Subaru Outback with 45,000 miles for $17,000. KBB private party is actually $17,500. Only paid $25,000 for the car new.
I hear so often that it makes much more sense to buy lightly used cars and I just don't see it. I also hear that the minute you drive off the lot you lose 25% and I just don't see that.
I drove this car for 5 years and 45K miles and only lost 32% of what I paid. The car cost me 1600 a year with zero out of pocket repairs. The buyer is going to have to go 11 more years or 16 years total life with zero repairs to get the cost that low. I just don't see that happening.
Of course, your ancedotal evidence will refute a mountain of statistical data available.
Its not that I sold my car at a super high price. I sold it $500 under KBB. So I don't see how its just anecdotal. 2008 models from Honda, Toyota will have similar prices.
Almost all studies done are based on purchase price being MSRP. That is not true in the real world. Yes the car's MSRP was 29,000 but it could be bought for 25,000. And yes it probably lost 20% off MSRP the minute I drove it off the lot, but who pays MSRP.
Recently sold a 2008 Subaru Outback with 45,000 miles for $17,000. KBB private party is actually $17,500. Only paid $25,000 for the car new.
I hear so often that it makes much more sense to buy lightly used cars and I just don't see it. I also hear that the minute you drive off the lot you lose 25% and I just don't see that.
I drove this car for 5 years and 45K miles and only lost 32% of what I paid. The car cost me 1600 a year with zero out of pocket repairs. The buyer is going to have to go 11 more years or 16 years total life with zero repairs to get the cost that low. I just don't see that happening.
This will depend on the vehicle but generally a new-ish car with 45k miles on it still has a ways to go before any significant repairs are due. Up until my current car (wasn't available used), I've always bought slightly used cars (under 50k miles) and felt that I got a good deal. I've always paid under KBB value and even in your case, saving $8k on what is still a relatively new car isn't too bad if it is in excellent shape (interior and exterior).
Another thing is that due to various conditions, the value of used vehicles has been increasing in comparison to years past so a used car may not be as good of a deal as it used to. About three years ago I bought a 2007 BMW 530i with less than 60k miles for a bit under $25k which was a great deal on a 3 year old car in great shape.
I hear so often that it makes much more sense to buy lightly used cars and I just don't see it. I also hear that the minute you drive off the lot you lose 25% and I just don't see that.
It used to be true pre-recession but it hasn't been true since the recession started. New car sales went from 17M/yr to 9M/yr virtually overnight and are still still 20% below peak levels. That has dramatically reduced the supply of used cars driving up resale values. Cash strapped buyers are holding onto cars longer which probably isn't helping either. Anybody looking to buy a 3-5yr old car needs to check what a new ones are selling for (street price, not MSRP) or risk overpaying for their used vehicle.
Its not that I sold my car at a super high price. I sold it $500 under KBB. So I don't see how its just anecdotal. 2008 models from Honda, Toyota will have similar prices.
Almost all studies done are based on purchase price being MSRP. That is not true in the real world. Yes the car's MSRP was 29,000 but it could be bought for 25,000. And yes it probably lost 20% off MSRP the minute I drove it off the lot, but who pays MSRP.
But it is anecdotal. In 2009 I bought a 2006 300C for 19995. Brand new that car stickered - the way I bought it - for $41000. Basically 3 years and 27K miles later it was worth less than half than its original retail.
3 weeks ago I bought a 2010 Taurus SHO. That car stickered - the way I bought it - for $46700. I bought it for $27995 with 22k miles. In 3years that one lost 42% of its value.
The point is that cars lose value the minute you drive them off the lot. The one plus side is that once they lose that initial value they depreciate much slower.
The point is that cars lose value the minute you drive them off the lot.
You need to compare the used car to what a similarly equipped new vehicle is selling for on the street. MSRP tells you nothing about what people are paying for a particular new vehicle. A new German luxury model might be selling for MSRP, while a full sized American pickup could be going for $8-10k below sticker. I'm not saying used is always a bad value, just that you need to compare it to new in order to make an educated decision.
Almost all studies done are based on purchase price being MSRP. That is not true in the real world. Yes the car's MSRP was 29,000 but it could be bought for 25,000. And yes it probably lost 20% off MSRP the minute I drove it off the lot, but who pays MSRP.
Cash for clunkers removed a lot of good used vehicles from the market.
Driving up the price of good used vehicles.
No it didn't. It removed a lot of bad used vehicles from the market. The majority were older thirsty American vehicles like the Explorer. It was bad new, bad used.
Used vehicles are expensive now because the poor economy caused people to hang on to cars. New car sales have been good for less than a year. So it will take a bit of time before the tradein rate restores the supply of used cars.
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