It’s easy to shy away from buying a new car. It’s often thought that buying new will be a more expensive way of getting four wheels on your driveway, but our research shows that isn’t always true.
The term ‘used car’ can be applied to anything from a £250, high-milage rust-bucket that’s falling apart, to an eight-month-old pre-reg car or ex-demonstrator from your local franchised dealer. For the purposes of this guide, we’ll presume you’re looking at nearly new cars, given that you’re also considering a factory fresh model.
1. New cars aren’t always more expensive than used ones
Put simply, car makers will give you more incentives to buy new cars over used ones. These incentives could be anything from a low interest rate on a finance package, a hefty contribution towards your finance deposit or even a free servicing package to keep your annual bills down during the first years of ownership.
If you’re looking at a nearly new or pre-registered car then chances are you’ll save a few thousand pounds off the list price – simply because you won’t be the first owner of the car (a pre-reg car will have the dealer listed as its first owner). Despite this, if you’re taking out finance a new car could be cheaper, thanks to the aforementioned deposit contributions and lower interest rates. The interest rate for a pre-reg or nearly new car is likely to be a fair bit higher than the equivalent rate for a new car.
2. The total cost of ownership for a new car is often cheaper than for a used car
A survey in 2015 showed that a new car is often cheaper to run than a used one. With cars that’re over three-years old you have to factor in MOT tests and more intensive services – considering the higher interest rate you’d pay on a used car’s finance and a new model is often a better bet.
Modern cars also tend to have more efficient engines too, so you’re likely to be getting better fuel economy and paying lower road tax.
3. Depreciation is often outweighed by other factors
The unavoidable truth is that new cars will lose value (depreciate) the moment you drive away from the dealers. Used cars will usually depreciate more slowly, but – again – it’s vital you do some sums and factor in whether the money you save with a manufacturer’s new-car incentives outweighs this extra depreciation. And if you choose to lease your new car rather than buy it, depreciation isn’t your problem to worry about – you’re just renting the car.
4. The deals you get with carwow could undercut the price of nearly-new cars
Head over to the carwow configurator (by clicking the green button on our homepage) to build your ideal car. Then the UK’s best dealers will send you their best offers for your new car. You may be surprised at the discount you can get – it may even undercut a nearly-new model’s price. Head to our new-car deals page to see some of the best savings currently available.
The bottom line?
Do your sums. Work out how much the incentives to buy a particular new car are really worth. If you’re getting a new car with a free insurance deal, you could effectively be saving thousands of pounds in the long run. If you’re operating to a strict monthly budget then a new car on finance may be easier to stomach financially than a used version paid with a lump sum.