Getting a good deal on a car can really mitigate the effects of depreciation when you come to sell it again. But when is the best time to buy, and how can you get the deals?
Buy when you don’t absolutely need to
If you are desperate to purchase, you’re under time pressure and you really need the vehicle immediately, you are in a weaker negotiating position than if you have time to shop around. The salesperson should not know that you need to purchase immediately, although you can use that information to help close a deal if you’re looking to negotiate a sale on that day. You must be prepared to walk away, though, if you can’t get the deal.
Buy when you can afford it
If you have to borrow against the vehicle you will end up paying quite a high interest rate (unless you can provide some other form of security, such as your house). Being able to afford it also means being able to afford the insurance and maintenance on your vehicle. You might have the immediate cash to purchase a premium car such as a Maserati or Bentley, but can you afford the parts and servicing?
Buy when dealers need to fill quotas
Dealers of brand new cars have sales targets each month. If you purchase towards the end of the month they will often discount their price to meet their sales target.
Buy vehicles that have passed psychological barriers
100,000km is a psychological barrier; people try to sell their car before it reaches this level. However, in the UK or America, 100,000 miles (160,000km) is considered the same barrier. There’s very little difference between a car that’s done 98,000km and 105,000km but there might be a significant difference in price. In fact, many cars will now reach 300,000km with a little love and attention.
Buy a vehicle that has had major scheduled repairs done
Check before you purchase that the vehicle is not due for a cambelt change as this can be a major cost, especially for a cheaper car where it is a high proportion of the overall purchase price. If a vehicle has four brand new tyres, this is a good bonus.
Buy when other people are desperate to sell
Occasionally, people will fall in love with a car that’s got very little resale value or prospects and they struggle to sell it – perhaps a pink Jeep like the one pictured. If they’ve had to wear a huge amount of depreciation through questionable taste, you could pick up an absolute mint car for very little money. Of course, you also have to live with your choice! If it’s cheap enough, you could have it resprayed or vinyl-wrapped.
Large volumes of vehicles come on the market at certain times of the year. For example, at the end of summer, backpackers that have travelled around the country and have purchased a car just for their travels want to sell it again. These tend to be cheap, and the glut of them makes it cheaper.
Sellers who are emigrating also need to get rid of their car at all costs.
Buy when dealers have special offers
Dealers will often try to clear stock quickly if:
- They have committed to a shipment and won’t have room for it
- There’s a new version of a particular model being launched and they want to clear older versions of the model.
- They have targets at the end of the financial year (March or June, depending on their tax schedule)
- They want to get rid of a number of models in December before they become ‘last year’s models’
Buy at the end of the day
A dealer will want to go home at the end of the day, but if you are there ready to buy they won’t be able to. They might feel they could make some concessions in order to get out the door rather than risk staying late and then you not buying it.
Buy when you know what car you want
If you’ve done your research (e.g. by watching reviews online, talking to other owners, looking at user forums, etc) then you’ll be less likely to be talked into a car that doesn’t meet your requirements.
Buy a new model before it comes out
In some countries, certain models sell out very quickly; you have to order them months in advance. There’s then a resale market which can sometimes mean that the car will sell for more than the recommended retail price privately. This is a risky strategy, though.
Buy at auction
If you really know the value of the model of car you want, purchasing at auction can be fruitful if you’re prepared to wait for the right deal. You might not get it first time, but going back to auctions repeatedly will see you snag a bargain eventually.