Been thinking of buying a new or used car?

Question

I can't believe car payments can be as much as a house payment. With a possible recession looming does anyone, besides the rich, really want to buy a new/used car?

Car prices hit record
“The average price of a car has gone up so much and so quickly. You’re not seeing zero (percent financing), no lease deals. You’re not seeing anything,” said Ian Beavis, chief strategy officer at AMCI, an automotive industry marketing firm.

Some of the highest payments are occurring for luxury vehicles, bought by rich customers who are fairly immune to the ravages of inflation, and rugged but costly heavy-duty SUVs and pickups often purchased by drivers who need them for cargo hauling and passenger capacity.

“It’s an interesting mix,” said Ivan Drury, an analyst for Edmunds. com. “The work vehicle or the ‘completely-over-the-top’ vehicle.”

Since many car dealers or manufacturers list financing options and projected monthly payments, it’s relatively easy to just how high payments have become. Examples:

A 2017 Chevrolet Suburban 1500LT with 11,000 miles on its odometer was on sale at a CarMax dealership in Oklahoma, for $71,998. That works out to an estimated $1,433 to $1,547 a month on a 48-month loan to buyers with very good credit for the full-size SUV.
A 2022 Ram 1500 Laramie Crew Cab pickup at a Denver dealership had a list price of $67,790, which translates to $1,271 for 48 months.
A new $65,170 new Mercedes-Benz E-Class 4Matic would have payments estimated at 1,234 to $1,284 a month at a dealership in Clearwater, Florida.

I guess car inventory is low. The dealer that I bought my car from has offered to buy it back for almost as much as I paid for it because it is a highly desirable model, and with supply and demand, a new one would be $40,000 higher than what I paid because the dealer knows they can get it.

What most people can actually afford now

Valso · Accepted Answer

I was thinking about a car at some point but for a long time owning a car has become an expensive luxury, so I gave up. In order to own a car and be able to live normally you need at least $5,000 monthly salary. AT LEAST!

• About $1,000 for the license lessons. Probably twice more, if the teachers ask for something "extra under the table", so to speak, otherwise they won't let you pass.

• Given the current gas/diesel prices and depending on the car's fuel tank, you'll need another $500 (or more) to feed that car every month and that's if you drive as economical as possible. There aren't enough power stations in my country for an electric car to be viable yet.

• Insurance is a few hundred bucks, new tires of a nice brand for the current season are about $100-150, the yearly technical support for the car is I don't know how much by now.

• On top of that, if you're married, you'll have to have at least another $3,000 (monthly) to indulge ALL the whims of your gold digger, pardon me, I mean wife.

• If you're prone to violations of the road law, then you'll need another $500-600 a month for bribes for the road police...

• Add to all that the stress of driving among great idiots which make Mad Max look like an innocent kid...

Thanks, but no, thanks! If I had this kind of money, I'd rather give all that money just once to have a custom made bycicle with 4 wheels (a little wider than a motorcycle) and then pay nothing bc the bike doesn't need insurances, doesn't need a yearly technical support (sure, it does require some but it's a lot cheaper than that of a car), it can go almost anywhere, not just on asphalt (therefore avoding the road idiots) and its tires are way cheaper than those for a car, doesn't need fuel, not to mention it's much healthier than a car because you keep moving while you're riding it thus losing weight. Oh, yes, and the bicycle doesn't require a driver's license. 😁

And the best part? I don't have a gold... errr... I mean a wife, so I get to keep all the money I make.

Massageman · Accepted Answer

Yeah - it sucks out there.

We had a 2010 and a 2018, both Hyundai. We bought a 2023 Kia. Hyundai owns a big chunk of Kia, and many of their parts are mutually shared, so I am used to their collaborative car creation methodologies. We researched gently used cars: they were as much- or MORE- than what we paid for the new Kia out the door, and maybe half of them were already out of warrantee.

We DID have to get a much darker gray (Gravity Gray) than I would have liked (Steel Gray or Silver). But when the biggest dealer in the area only gets 5 cars in a month- 2 grays, 2 whites and a black, in the model you want- things can get a bit grimy. Having five years worth of accumulated savings and a high credit score didn't hurt either. The only good thing about a slim inventory: the dealers want to close a sale- PERIOD. They were perfectly happy NOT to push any of the "aftermarket" Bravo Sierra stuff on us like thousand-dollar paint protection Tx, fancy "extended guarantee" plans, etc. They just want the cars to sell, bring in money, move off the lot. Boom - done!

We sold the oldest car to our kid for a dollar- just to keep it legal- since one of their cars is in even worse shape than ours. Their's has 220K miles on it for the same year, but ours has 80K and reasonably new tires.

erandal · Accepted Answer

I used to love new cars but realised one day (just as I picked up a brand new vehicle from a dealership) that it had basically lost a third of it's value the moment it left their showroom. I vowed never to buy a new vehicle ever again and I now adhere to the principle of 'bangernomics', so as long as it costs less to keep my old vehicle on the road each month than it would to buy a new one, I'm keeping it.

I currently drive a 2004 Volvo V50 with 130k miles that only cost me less that £1,900 GBP. Most months it costs me nothing beyond fuel and it has been totally reliable in the many years I have owned it. As long as it has electric windows, central locking, heated seats and cruise control it's good enough for me. I also like the anonymity that an older car gives me.

Iron_Man · Answer

Get a car out of the paper or they have some good advertising on Facebook for local people selling their cars, the dealerships the depreciate so much as soon as you drive it off the lot. We are checking into a dodge challenger like a 2020 version and we’re gonna get it out of the advertising on Facebook or the newspaper you’re totally wasting your money going to a dealership you can get more bang for your buck through a private dealer just bring a mechanic with you when you test drive it and have him check it Thoroughly before you make the deal

lightbulb27 · Answer

I was hoping to take our time off buying another (used) car over next 6 months waiting for recession to increase supply of used cars. but it's possible a thief just expedited our purchase by "relieving us" of our catalytic converter.

It might make sense to trade in our house for a car we can sleep in. if factor in fuel, we could live in it for a few years before we are stranded on the roadside.

The governments efforts to "bail out the failures", like 2003, 2008, 2020 (covid), and now 2022.. funneled $ into the hands of a few, and those people can afford expensive stuff. The rest of the people working jobs that didn't hit it big in the stock market lost their shirts... literally. Pinched by inflation in cost of living, it's tough going. Many are going to use everything unless the govt continues to bail them out.

Car prices are nuts, but all prices are nuts.

exitseven · Answer

Both my wife and I bought new vehicles. She has a 2018 Ford Escape and I bought a 2019 Ford F-150. I think e are good for another ten years or so. Hot Rod with a pickup bed.

Texaskid1 · Answer

Buy a good used car- it will cheaper in the long run especially if you are traveling mostly high way miles. A new car will be more expensive as the taxes are high and you will spend more time paying it off. Not to mention you will eat the cost of the car's depreciation and the insurance will be more expensive. But to get a good deal you will have to do some shopping around and test drive multiple vehicles. If it is a used car make sure you take it to a trusted mechanic first so he can look at it and see if it has any suspicious noises, smells, signs of past collisions, vibrations , rattles. etc. Also , look into car rental companies like Enterprise and see how much they are selling their used cars for ( these companies will sell their cars after about 40,000 miles or so an they slay keep them in good condition). I bought a used car that was a rental car. So far I have put about 70,000 miles on it (mostly highway) and I have had very little trouble with it.

Likes2drive · Answer

It’s usually 72 month loans now because of the high payment amounts, that’s what I ended up with over a year ago on my 2020 Toyota I got for $30,000 plus all the other fees. But since it was over a year ago when things just started getting crazy I still got 2.9% interest loan on it. So my payments are not that bad and I’m also paying more towards the principal to knock off some years. I could probably sell it for the same price I got it but then I won’t have a car

reelteen · Answer

You don't need a high end vehicle to have one that lasts. My 2019 GMC Canyon will last me another 8-10 year easily, and I got it for $26k. My payments are less than $400 a month, and I pay extra. I can tow more than I need, it's decent on gas, and I love it for what it is: a truck. I don't need a 2023 GMC 2500 Sierra Denali that can tow 25,000 pounds, I just need my little Canyon. Don't shop outside your means, and you'll be fine

maximumpower · Answer

One of the fallouts from combined effect of pandemic, economy, and low production of some vital car components has led to a "shortage" of used cars.
If you have one, keep it. If you need to buy another, buy only the car you NEED - used.
Don't buy a Mercedes if you can only truly afford a Chevy.
Purchase from private party if at all possible. Get in good with someone that knows cars and enlist their help to figure out which ones are worth purchasing.

Oh - and the dealer offer to buy back is a sales tactic - a new twist on the old "bait and switch."
The "you own a desirable model" is baloney. You've already bought from them once, so they're betting you'll buy from them again.
Look it up.

jshm2 · Answer

The secret is not to buy American made crap.

Buy South Korean or Japanese instead and you'll find that you pay a bit higher, but the maintenance and fuel costs are much lower.

I've 4 cars and my oldest is a Hyundai - which has only been in a garage for it's service. Never had a fault with it and this vehicle is hitting 100,000 miles.

Zolly99999 · Answer

It's a really tough market these days.. do some research but I find now it's better to buy a new vehicle as used car prices have sky rocketed to almost the price of a new vehicle. 3 years ago and earlier i would have said get a good used vehicle but not these days.

Guy13 · Answer

There are going to be many one car families over the next 7 years. I’m sure it is already happening but no one has taken notice. Most of the people I know both or at least one works from home.-So, their gas expense is same as Pre-Biden.

Kabluie · Answer

Inventory is lower, the turnaround time to sell is much lower even for used cars. One thing is don't get caught up on buying a car based on the monthly payment. Do you really want to be in that 72-month finance club? I like that question. Obviously lower is better but it's all about going in with the focus of how much you are willing to pay and can afford.

MCheetah · Answer

Either buy a hybrid/electric car, or just don't bother and just get a bicycle instead. Cause it's not like we're making more oil and gasoline anytime soon. It's going to be the smarter choice in the long run.

MikeInHawaii · Answer

If you HAVE to finance a Mercedes, you can’t afford one. Of course, with a low enough interest rate, it wouldn’t make sense to cash out an investment with an 8% ROI when you can get a zero interest loan.

NYCQuestions1976 · Answer

I bought a used vehicle in November 2019 for around $12,000. I could probably sell it now for around $17,000. I won't, because it's my commuter.

Jamie05rhs · Answer

Hell no. Not in this economy! But I'm glad I already bought a car in 2018, so I'm good.

genericname85 · Answer

buying a new car is the worst financial decision anyone can make.

bigpauly · Answer

I have been in the market for a new flaming windup car

Guardian45 · Answer

Buy used cars. As you take possession of a brand new car, it instantly loses 30% of its value!

Surely · Answer

My wife and I bought new ones in 2021. Hopefully they will run a long time!

EnglishEuropean · Answer

Stick around, prices have to come down at some point.

Been thinking of buying a new or used car?

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