Author Topic: Formula for choosing new vs used car  (Read 738 times)

Kapiira

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Formula for choosing new vs used car
« on: January 14, 2017, 12:27:12 PM »
Does anyone have a formula for deciding whether to buy a new or used version of a car?  I'm looking at getting a Subaru and I'm not sure that recent models are discounted enough to be worth buying used.

boarder42

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Re: Formula for choosing new vs used car
« Reply #1 on: January 14, 2017, 01:13:30 PM »
Yep by used

There is no other formula

Should be older too 3-4 year old cars still have a premium. Go back past 2008 and there are deals.

daverobev

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Re: Formula for choosing new vs used car
« Reply #2 on: January 14, 2017, 01:17:32 PM »
You have to work either expected life by age, or by miles/km.

Purchase price new = $30k; expected life = 300,000 km or 15 years, whichever comes first (but assuming neither is ridiculously off - so a 20 year old car that's only done 20k km will not fit this thinking).

If you live in a salty area, I would put that 15 years as a hard cap. If you live in sunny California, and keep the car in the shade (garage), it could still be just fine in 25 years.

So a 3 year old car that has 60k km (or 40k miles, with cap of 200k miles) should 'straight line' be 80% the price of a new one. With some wiggle room; a used car at 3 years will have little or no warranty left, and 'who knows how the previous owner took care of it'. So if it's close to 80% I'd go new. 70% or less, used.

Subies don't depreciate fast, though. People love them. Same as Toyotas and Hondas.