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Let's say you don't care about the new car smell, isn't buying used a much better deal?
For example, a 2016 Honda Accord EXL costs about $29K, but if you buy the 2013/2014 version with 20,000 miles on it, you can buy one for about $19K. That's a $10,000 saving.
Please show me where I can be a non-salvage 2013/13 Accord EXL with 20k for $19k.
While some vehicles do indeed depreciate fast and make more sense to buy used (rentals favorites such as Fusions, Foci, Sonatas come to mind), Hondas in general and an Accord in particular are not great examples of savings when buying used.
if you really like used cars you can buy your own accord at the end of the 38 months for $13,588.80.... and have a higher payment... or just lease another one
It almost always pays off to buy a 2 or 3 year old car vs a new one. The only time it doesn't is if you can get within 10% or so of the used price by getting 20% or more off of msrp and there is enough demand for the used 3 year old model that it has retained more than 60% of its value.
Quote:
Originally Posted by keraT
I am in the process of doing the research to see how many years older will give me best bang for my bucks. I am specifically looking at Toyota after driving GM car (Chevy and Pontiac) for last 2 decades. How much do cars depreciate after 2 year, 4 year..etc)?
1st year 20%
2nd year (and each year after that) 15%
So it looks like this when looking at % of original value
1st year 80%
2nd year 68%
3rd year 57.8%
4th year 49%
5th year 41.7%
6th year 35.5%
7th year 30.1%
8th year 25.6%
9th year 21.8%
10th year 18.5%
You will be hard pressed to very many cars that break this rule by any significant amount. There are very very few examples of any mass produced cars that do break it.
Now some lux models may exceed this and depreciate faster.
After 10 years its get dicey. Many more things come into play so its kind of up in the air after around 10 years.
Lots of people scoff at first. Especially people that do not understand what their car is actually worth. When assessing a vehicles depreciation you need to look at the Dealer Invoice for that car when it was new and the avg dealer trade in price. Thats what the majority of most people pay and what they get when they sell.
Quote:
Originally Posted by acercode
Responding to your misinformation isn't "harassment" its called a conversation... something that happens a lot on public forums, where posters are free to respond to any post they wish and correct their misinformation, which happens quite a lot with you.
Actually its you that i frequently notice filled with misinformation. Most of the time I just ignore it.
Quote:
Originally Posted by azsportpilot
a rich man once told me "Buy things that appreciate, Rent things that depreciate"
Only problem is that when you lease a car you pay for the depreciation and then some.
Quote:
Originally Posted by pvoyd
Please show me where I can be a non-salvage 2013/13 Accord EXL with 20k for $19k.
While some vehicles do indeed depreciate fast and make more sense to buy used (rentals favorites such as Fusions, Foci, Sonatas come to mind), Hondas in general and an Accord in particular are not great examples of savings when buying used.
Autotrader currently shows 120 2013 Accord EXL at $19K or less. Now thats the dealer asking price. I am sure any decent negotiator can shave at min 5% off but you should be able to aim for more like 10%.
Actually all those cars fall pretty much in line with the avg depreciation rates.
Looking at long term, after 39 months of payments, when leasing, you have nothing to show for. When buying, after certain months, you OWN the whole car. Is leasing is such a good deal, do you think these leasing companies will be in business with overhead cost, salary cost, etc.?
Looking at long term, after 39 months of payments, when leasing, you have nothing to show for. When buying, after certain months, you OWN the whole car. Is leasing is such a good deal, do you think these leasing companies will be in business with overhead cost, salary cost, etc.?
if you really like used cars you can buy your own accord at the end of the 38 months for $13,588.80.... and have a higher payment... or just lease another one
you will have spent $9500 during the lease, and $13,588 to buy it = $23,088 for a car with an MSRP of $23,840.00
not terrible considering you are totally avoiding interest and repairs for the first 36 months of the 39/mo lease
the "leasing company" is honda motors and they do it to move cars, it works out great for them, when you hand it back in, the dealer pays honda $13,588 for the car then sells it for a couple thousand more ($15,588- 5yrs-4%int = $287.08/mo) to someone who doesn't understand leasing
Last edited by azsportpilot; 01-25-2016 at 05:16 PM..
if you really like used cars you can buy your own accord at the end of the 38 months for $13,588.80.... and have a higher payment... or just lease another one
you will have spent $9500 during the lease, and $13,588 to buy it = $23,088 for a car with an MSRP of $23,840.00
not terrible considering you are totally avoiding interest and repairs for the first 38 months
the "leasing company" is honda motors and they do it to move cars, it works out great for them, when you hand it back in, the dealer pays honda $13,588 for the car then sells it for a couple thousand more
I don't like used cars, I like savings in the thousands. your scenario above doesn't not save thousands.
if you really like used cars you can buy your own accord at the end of the 38 months for $13,588.80.... and have a higher payment... or just lease another one
The payments on the lease total $9,750
The msrp listed in the ad is $23,840
23,840 - 9750 = 14090
The expected depreciation over 39 months (3 years) is 20%, 15% and 15%. That equals $13,779.
Amazing how that works.
People that keep saying Accords hold their value better should pay close attention to this ad and see what Honda themselves say how fast their cars depreciate.
So I don't really see how leasing that new vehicle saves you a dime compared to buying a used car. I dunno where you guys get loans but my credit union is advertising 1.5% on used cars (less than 5 years old) right now for 36 months and 2% for longer.
You could get a 48 month loan on a used $13,700 car and keep those payments at $250 and after 3 years you would have about $5K in equity. With the lease you own nothing.
So is it worth the 5K for you to drive new? Or could you use that 5K to pay down some other debt and drive an "almost" new car.
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