New cars, however, are bursting with all the latest safety features, better fuel economy and offer a broader range of financing options to make your purchase more affordable. But that’s not all. You need to consider reliability and upgraded tech over a lower price on the dash.
Here we take a look at the pros and cons of both new and used cars to help you decide:
The big advantages of buying new
Opting for a new vehicle comes with numerous advantages. First, there are no previous owners to worry about. Everything you see is what you get, and there is no hidden history lurking in the paperwork.
Then there is the undeniable perk of the manufacturer’s warranty. You’re fully covered should anything go wrong, and you might even get servicing thrown in for free.
More choices are also available to you. Choose the exact specification you want, the colour, trim and engine size.
But that’s not all. Newer cars have more advanced technology and better safety specs, which covers everything from automatic emergency braking (AEB) to collision warning and detection. Throw in advanced fuel efficiency, and you’re laughing. Plus, there is no MOT to worry about until three years after registration.
More buying power
Did you know that over 86% of UK motorists pay for their new motor with car finance? This automatically makes buying a new or used car more affordable, as you can pay back the cost of the vehicle over a fixed period.
In short, you get more spending power at the dealership and more options than you would with cash alone. Choose from personal contract purchase (PCP), hire purchase (HP), leasing or a personal loan to find the best buying option for you.
PCP and HP are the top two for most drivers. You simply place an initial deposit (10%) followed by low monthly installments. Both are unsecured loans, so if you miss a payment, the lender will repossess the vehicle rather than your home or possessions.
With that aside, car finance gives you more flexibility in the long run and more choice overall at the dealership.
The downside to buying new
While the advantages of buying new are very attractive, there are, of course, some downsides too:
- More expensive: Fresh from the forecourt, a newer car will likely cost more than comparable used vehicles. You also have to take the depreciation hit that can average 50% after five years.
- There might be a wait: You might have chosen your car, signed on the dotted line and are ready to drive away. The catch? Your model and specifications aren’t currently available, and you may need to wait weeks or months before it arrives.
- Higher insurance premium: Some newer models come with a hefty insurance premium due to their higher value and increased cost of replacement parts.
- Electrical faults: Most breakdowns in modern cars stem from an electrical fault which is harder to resolve at the side of the road.
The perks of buying a used car
Sometimes a secondhand car is just what you need. You get significantly lower outright costs compared to a newer vehicle, and most will have already fallen in value, so you don’t have to worry about depreciation.
What’s more, the money you could have spent on a new car could buy you a higher-spec used vehicle for the same amount.
If you’re not too fussy about the vehicle you want, as long as it ticks all the right boxes on the day, you won’t need to wait before you drive off the forecourt. So as long as you have the available funds – either cash or a car loan, you could get the car almost instantly!
Cons of buying a used car
Like all things, there is a flip side to buying a used car:
- More likely to have issues: Simply buying a used vehicle implies that it has seen more wear and tear than a new one. It has had more years on the road, and you can’t be sure how well the previous owner looked after it. Ergo, you might end up having to cover costly repairs and spend more time in the garage!
- Less likely to be covered by warranty: The manufacturer’s warranty runs from the day the vehicle is registered, so by the time you come to buy, it’s likely that it has already expired. While you might be lucky to get the tail end of the warranty, you’ll either have to accept that you are no longer covered or take out another cover with a third party.
- MOT and servicing costs: Used cars tend to have exceeded the three-year break from MOTs. So you’ll likely have to foot the bill for your annual MOT from the moment of purchase and pay for any repairs along the way. Servicing is also your responsibility, so make sure you budget for all eventualities.
- Car finance might not be an option: While some lenders will cover PCP and HP loans for used cars, this isn’t true across the board. You’ll have to either front the cash yourself or take out a bank or personal loan.
- Private sales can be dodgy: If you choose to go private over a dealership, you won’t have the same rights of sale and protection. So make sure you feel comfortable with your purchase before handing over any money!
Which should you choose?
Whether you buy a new or used car, you need to be comfortable with your purchase. That means feeling right behind the wheel and getting the driving experience you want from your vehicle—all without breaking the bank.
Opting for a newer model will give you more variety, especially if you choose to pay through car finance. You get all the advantages of manufacturer warranty and servicing and can go a step further and upgrade to an electric vehicle.
Used cars come with a smaller price tag, are more readily available and have already taken the depreciation hit, so you don’t have to.
Whatever car you choose, make sure you pick the right new or used car for you! Create a budget, stick to it, and do a spot of research ahead of purchase to know what you should be paying. What car will you drive away in?