Crystal Ball: Buy New or Wait for Used

[treillw]

Conventional wisdom in the past was to buy a slightly used vehicle that has already largely depreciated. However, every time I look at buying used recently, I talk myself into new being a better deal. Dealers still have three year old used cars with 70k miles on them listed for a few thousand less than new - part of me thinks that they are still trying to take advantage of things.

I would like to get a new vehicle for work travel that gets better gas mileage than my truck's at best 17mpg. I don't need one immediately however. Just stinks running my truck into the ground, when I could be using something that costs less and is more efficient. I'll probably put 20k work miles on the truck in 2023.

Seems like chip shortages are dwindling - lots of trucks on the lot and I could buy several RAV4 hybrids, which were previously on an 18 month wait list.

I think used prices have to fall, but the other edge of the sword is MSRP is going up and inflation.

Should I buy new now, or wait for used prices to fall. Why? I could wait a year or more if I had to.

 

[Amos Moses]

There are lots of ominous signs coming out of the vehicle market currently. Mannheim used car index has been falling at some of the fastest rates on record. Defaults and repos skyrocketing. I’ve even been reading pretty sketchy things about lenders allowing buyers to finance a second vehicle knowing they’ll likely default on the first loan and just have the vehicle repossessed.

I’m holding off on any vehicle purchases for the time being. Inventories should grow substantially, and the high cost of financing should also slow the industry down quite a bit.

 

[Theringworm]

In this market, my opinion is:

You buy USED because you are limited by the actual cost of the vehicle.

You buy NEW because it’s the best bang for your buck. To me a $5-10k difference between brand new vs used with 30-50k+ miles on the odo isn’t reason enough to deter me from paying more for a new car. I am buying new every time. But, if you can’t afford it you can’t afford it and should stay within your financial means.

That said, I will never pay over MSRP.

 

[BRTreedogs]

Like I said in your other thread. Auto trader advance search and don't be afraid to fly and drive it home.

I've also found the 1st week of January to be the best sales on newer rigs. I've bought 2 of mine then.

 

[HuntHarder]

Same boat as OP. I think I am opting to wait, as I am not really in need, more of a want kind of thing. My crystal ball tells me that in less than a year, things will be better for guys with cash on hand..

 

[Will_m]

In this market, my opinion is:

You buy USED because you are limited by the actual cost of the vehicle.

You buy NEW because it’s the best bang for your buck. To me a $5-10k difference between brand new vs used with 30-50k+ miles on the odo isn’t reason enough to deter me from paying more for a new car. I am buying new every time. But, if you can’t afford it you can’t afford it and should stay within your financial means.

That said, I will never pay over MSRP.

You buy used because you don’t take the same depreciation hit. The minute that vehicle leaves the lot, it’s worth a lot less than what you paid simply by virtue of being used. Historically it has not been the best bang for your buck. That said, you may be on to something in the current market.

 

[BRTreedogs]

You buy used because you don’t take the same depreciation hit. The minute that vehicle leaves the lot, it’s worth a lot less than what you paid simply by virtue of being used. Historically it has not been the best bang for your buck. That said, you may be on to something in the current market.

Not so much true with Toyota
50k like 3k less then new.
Then once you factor in all the maintenance and the tires it needs, mise well buy new.

 

[Ferrulewax]

Been rocking a beater 2003 Camry after my SUV got totaled since last May... starting to think all the money i'm "saving" by waiting out the market probably isn't worth it.

 

[treillw]

Like I said in your other thread. Auto trader advance search and don't be afraid to fly and drive it home.

I've also found the 1st week of January to be the best sales on newer rigs. I've bought 2 of mine then.

Been looking there and on car gurus. Can't even find something worth flying to.

 

[Reburn]

IMO
It's not looking up for the economy. I would wait to see how things look about june.

 

[MattB]

The used car market has already started to correct, and my sense is values will return to closer to pre-COVID levels by mid-2023.

 

[Yoder]

Not so much true with Toyota
50k like 3k less then new.
Then once you factor in all the maintenance and the tires it needs, mise well buy new.

I never buy new. My last car was $26k new. I bought it 4 yrs old with 50k miles for $9500. This was before everything went crazy. I've been looking at SUV's for a while. New are $40k. Used with 90k miles are around $13k. I could buy three of them for the price of a new one. Used prices went down this year on average 5%. I'm waiting to see what happens in the next 6 months before I buy.

The computer chip crisis is over. I work in the industry and right now it's completely dead. They scaled back production and already had a layoff last month. There is actually a surplus now. Good thing we got all that money from the Chips act to build factories we don't even need anymore.

 

[tdhanses]

You buy used because you don’t take the same depreciation hit. The minute that vehicle leaves the lot, it’s worth a lot less than what you paid simply by virtue of being used. Historically it has not been the best bang for your buck. That said, you may be on to something in the current market.

That was true 3 years ago, not so much currently.

 

[treillw]

I never buy new. My last car was $26k new. I bought it 4 yrs old with 50k miles for $9500. This was before everything went crazy. I've been looking at SUV's for a while. New are $40k. Used with 90k miles are around $13k. I could buy three of them for the price of a new one. Used prices went down this year on average 5%. I'm waiting to see what happens in the next 6 months before I buy.

The computer chip crisis is over. I work in the industry and right now it's completely dead. They scaled back production and already had a layoff last month. There is actually a surplus now. Good thing we got all that money from the Chips act to build factories we don't even need anymore.

You're seeing $40k SUVs used with 90k miles on them for $13k currently?

I'm certainly not finding stuff like that, or I'd scoop them up.

Stuff with 90k miles on it is $4k less than new most of the time from what I've seen.

 

[Theringworm]

That was true 3 years ago, not so much currently.

Correct, that was the case pr-COVID. Not anymore. Many, dealers, though not all, won’t/can’t sell new cars over MSRP. There are no rules for used cars. Many hard to get vehicles currently, I.e. loaded f250 or other high demand cars, appreciate the moment you drive them off the lot because they demand is higher then the supply. It all depends on what vehicle you are shopping for.

 

[BRTreedogs]

I never buy new. My last car was $26k new. I bought it 4 yrs old with 50k miles for $9500. This was before everything went crazy. I've been looking at SUV's for a while. New are $40k. Used with 90k miles are around $13k. I could buy three of them for the price of a new one. Used prices went down this year on average 5%. I'm waiting to see what happens in the next 6 months before I buy.

The computer chip crisis is over. I work in the industry and right now it's completely dead. They scaled back production and already had a layoff last month. There is actually a surplus now. Good thing we got all that money from the Chips act to build factories we don't even need anymore.

Must be Chevys
Cause Toyota, Honda, subaru doesn't drop like that unless they don't have a clean title.

 

[treillw]

Dealers in my area are sure keeping the nothing is available narrative going as much as possible, when there are 4 sitting on the lot with $3k markup and a bunch of window tint and crap you don't want mandatorily added.

 

[JustSomeGuy35]

I don't have any advice to give but just want to say that I'm tired of seeing 20 yr old economy cars listed for $6-8k. Makes me want to puke!

That's why I'm driving my gas guzzler truck until it blows up. Then I'll buy a new vehicle.

 

[540-Virginian]

Must be Chevys
Cause Toyota, Honda, subaru doesn't drop like that unless they don't have a clean title.

Concur. Good luck finding any of those japan brands used at a deal. I have always bought used, but we are due for a new family car in a few months I suspect. I can’t figure why I would but a 70k miles subaru for $5k less than the brand new one next to it with almost no miles…

 

[bojangles808]

I've been looking at SUV's for a while. New are $40k. Used with 90k miles are around $13k.

what model and where is this?!