Buying quality used cars is usually the way to go when looking at purchasing any car. New cars can be more exciting and feel like a bigger deal than getting discount cars, but the money that goes into pre-owned cars goes straight towards the features and amenities the car offers. Much of the price of a new car is just because of that—it’s new. You know the old saying, as an owner of a new car drives it off the lot, the value has already begun to depreciate. What you probably don’t know is just how much a new car depreciates in value over the first five years. Whatever price you paid for your shiny new ride, 45 percent of the price you paid for the car will go out the window due to appreciation. You will never get that amount back and will probably not be able to sell the car for more than 65 percent of its original value after only five short years of being the owner of the vehicle.
If you want the biggest bang for your buck, look into quality used cars sold in different places. One of the best ways to go right now for cheap cars that are of a high quality is to look into used trucks and SUVs. While gas prices were high last summer and into early this year, many SUV and truck owners unceremoniously dumped these inefficient gas guzzlers. Now that gas prices have receded a bit, it’s time to re-evaluate the good points of SUVs and trucks, especially if they are discount cars.
Back to ownership costs, purchasing new vehicles as opposed to three-year-old pre-owned cars results in a cost difference of literally thousands of dollars. The October 2008 Consumer Reports magazine listed an impressive statistic. The difference in ownership costs for five years of a 2006 Ford Escort sedan when compared to a 2009 of the same model came to over $8,000. A full-size 2006 Chevrolet Tahoe could be owned and operated at $25,500 less than the 2009 model brand new off the lot! If gas is your biggest concern when calculating cost of owning a vehicle, you are sorely mistaken. Cheap cars that are still reliable, but a few years old, will save you thousands in ownership costs, even if they use a little more gas.
So what are the best deals out there on quality used cars? There is no standard “sticker price” on pre-owned cars, trucks and SUVs, so the forces of supply and demand tend to be the biggest determiners of the price of discount cars. Gas prices are also a big factor. It is has been estimated that for each single dollar increase in gas per gallon, the value of pickups decline by $2,200. On the other hand, compact cars increase in resale price by nearly $1,000. Apparently it can be said that the price Americans pay at the pump seems more relevant than depreciation and cost of ownership. Cheap cars can be great to own, even if they use a little more gas, because $20 more a month on gas is significantly less than thousands of dollars over a period of five years for owning a new car.
Right now, the way to buy any vehicle—cars, trucks, SUVs, mini vans—is through government and police auctions. There is absolutely no way to strike a better deal on quality used cars than through this method. Discount cars abound at these auctions! The vehicles that are sold may be cheap cars in price, but not in quality. Learn about auctions in your area to take advantage of great savings on pre-owned cars!