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Why are used cars so expensive?

tompaulco (629533) writes | more than 5 years ago

Transportation 1

I am in the unenviable position of having to find a suitable car for my 16 year old stepson. Naturally, new cars are out of the question, because there aren't any in the price range that a new driver ought to be driving (approximately $1500 to $2000 in my opinion). So I started looking at used cars. However, there also aren't any used cars in that price range that actually run and aren't falling apart. My first car, 20 years ago, cost about $1200 and it ran and it was only falling apart a littleI am in the unenviable position of having to find a suitable car for my 16 year old stepson. Naturally, new cars are out of the question, because there aren't any in the price range that a new driver ought to be driving (approximately $1500 to $2000 in my opinion). So I started looking at used cars. However, there also aren't any used cars in that price range that actually run and aren't falling apart. My first car, 20 years ago, cost about $1200 and it ran and it was only falling apart a little. Also, that car was really only worth about $700. I figure if inflation has doubled in the last 20 years, and it hasn't, then I should be able to get a comparable car for about twice what that one was worth, or about $1400. However, it seems that an eight year old car with 100,000 miles on it these days still costs about 5,000. A lady at work was thinking of selling her 2002 Honda Civic with 72000 miles on it. I figured she might get $5,000 retail for it and I might be able to get it for $3,000. But no, according to Kelly Blue book, this car retails for almost $10,000, and trade-in is almost $6,000. This is a car that was probably released in 2001 and is therefore 8 years old, and has close to 100,000 miles on it. another 28,000 miles and you wouldn't be able to get a loan on it, but the dealers want $10,000 for it. It was only $13,000 brand new. How is it that a car can loose half it's value when it drives off the showroom floor, and then 8 years later still cost 80% of it's original value?
Where does one go to find reliable transportation at prices befitting the fact that the person driving it is almost certainly going to wreck it within the next two years?

1 comment

don't spoil the kid (1)

Bill Dog (726542) | more than 4 years ago | (#24743671)

Look in your local papers' classified ads. Pick up an AutoTrader booklet (their web site basically doesn't work) at a grocery store or a gas station's quickie mart. Stay away from dealers, and their markup.

Stay away from Hondas, esp. Civics. Young Asian boys are always looking to buy those up, even the junkiest ones, as they end up redoing most of the car anyways, on their way to ricing it out. So demand is high for them, so therefore so are prices. (And so therefore they're stolen a lot.) Stay away from Toyotas as well, because they are also widely perceived as being reliable, and therefore older even POS cars will tend to be priced higher than what an unbiased person would say they're worth.

Consider re-evaluating your criterion of "reliability". No one I knew when I was 16 had a "reliable" car. In fact, only a tiny %-age of people in my whole high school had cars, esp. at 16. Some might even say that part of the experience of owning your first car is it breaking down on occasion and having to fix it, cheaply, and learning some things about cars in the process. For example, my first was a hand-me-down from my folks in my 2nd year of college (I guess after I'd shown that I was going to stick it out), a 10-year-old car with 100K miles on it, that was my mom's previous grocery-getter. Things like the battery and alternator and water pump and coolant thermostat died over the next few years, and I was no worse for the experience. Consider a family hand-me-down, if you have one or can make one available -- at least you know its history, and is not as big a risk as buying someone else's pile of crap.

Hmm, note also that it's typically the small, cheap, entry-level cars that get the best gas mileage (by generating the least power, plus by virtue of being naturally light), and so these are in demand right now, probably new and used. What you're looking to buy, you're buying at a notably bad time to be buying such. I wouldn't buy -- maybe you can find a junker somewhere amongst extended family. The kid should be thrilled he's getting *any* wheels, of his own, at 16. I would've been.

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