Quote:
Originally Posted by TwistedCopper
Although often is the case that you'll lose a considerable amount of equity in a new vehicle as soon as you assume ownership, it's not always true. If you get a good deal it's not always a loss right off the lot, and when you go to trade or sell it down the road, having one owner and maintenance records adds to the value. The differences can offset each other.
Lastly, if you keep the vehicle longer, the less likely you will lose any money on it.
Bottom line is if you buy new and take good care of a vehicle, it's longevity and/or higher trade in value can outlast/offset it's additional "new car" cost.
|
How do you figure? First of all, you cannot get a "good deal" buying new that doesn't cost you more than the vehicle is worth. Very few dealerships will sell at invoice or below, the best would be a few thousand under invoice. Now, take that vehicle and try to trade it for anything even remotely close to invoice and you'd be laughed off the lot. Second, having good records and being a one-owner vehicle will do nothing to change a car-dealers "black book" value. The only place that will help you is if you sell it privately to another individual, and even then it isn't worth much. A guy that wants a particular vehicle will pay the same price if it's one-owner or 10-owner and records won't matter.
Lastly, whether you finance a new vehicle or pay cash for it, you've already taken the hit and no matter how long you keep it, you will not make that money back. Vehicles are not an investment, they will continually lose value. Speaking of course of standard vehicles, not exotics and other high-end cars. The longer you keep it, the more miles you'll put on it, and the lower the value of that vehicle will be.
Bottom line is, even at below "invoice", a new car will never be worth more than what you pay for it, therefore it's longevity and alleged higher resale value will never offset the price you originally paid for it. If you trade a vehicle before it's paid off, you will end up paying even more for that vehicle when the dealer "pays off your trade" and adds it to the cost of the newer vehicle. To believe anything else would be fooling yourself. That's how dealerships stay in business...they have to turn a profit. If they are selling vehicles for less then they are worth, and buying or taking vehicles in on trade for more than they are worth, then they will not turn a profit and will soon go out of business.