Buy 2 year old car or PCP Brand new car?

[CrisW]

jamieduff1981 said:

There's no arguing with your arithmatic but what can you get for £8k that isn't, well, a bit ste?

With the assumption that for ~£26k he's looking at an A3. Probably diesel and I'm guessing a 2.0. Could be wrong of course.

Anyway perhaps this could fill in - http://www.pistonheads.com/classifieds/used-cars/a...

[Shambler]

A lease over two years. Would cost £2100 down and £350 a month for 23 months. For a brand new decent spec car.

[Justin Case]

Let the laws of supply and demand work in your favour. Every month there are thousands of three year old Audis coming onto the market at the end of their leases, so prices will be lower than for a two-year old with relatively few coming onto the market. You should be able to get a 40,000 mile example for about £14k or a higher mileage one for about £12k. Less to borrow means that you can pay it off quicker with the same monthly outlay and really save on the interest payments

[jamieduff1981]

OpulentBob said:

jamieduff1981 said:

There's no arguing with your arithmetic but what can you get for £8k that isn't, well, a bit ste?

Bit snobby, that.

£8k would get you in to a Porsche, a quick Jag, big Merc, all sorts of stuff.

Snobbishness not intended. I've had loads of the sorts of cars you describe for that sort of price bracket. I guess everyone is different about their motives. At the time that was my budget and those cars were the best I could do for the money. They were nice cars to sit in a drive, but they all needed work.

I still have some of those cars (the Jags specifically) and whilst still nice enough, they have been needing steadily more work since I got them. Just this weekend I was changing suspension parts again.

Some people are more emotionally affected by a list of pending work, niggles or the expectation of something needing done. I still like having older cars but it's also very nice to have something new too that I don't have to worry about. In the highly unlikely event that it breaks, they come and pick it up and give me a nice courtesy car until it's fixed.

Repairs on an older car will almost certainly work out cheaper than depreciation on a new car (or indeed 11% Audi finance) but it may or may not be worth the hassle depending on financial position or indeed character of the person.

With the X-Type and S-Type dead now, an £8k Jag in particular is going to mean an older, high milage XJ, XK or the very bottom of the XF market which will bring a need for corrective maintenance sooner or later. A Porsche will again be an older Boxster and Mercs will either be a high milage or older car or something with terrifying potential for repair bills like a CL. That doesn't make them bad cars, and I'm not trying to look down upon those who's budget is still around that figure, but whether to buy new or (well) used isn't purely a financial thing. It's not about showing off to the neighbours either. Sometimes it's just nice to have something new(ish)

[xRIEx]

magnitude12 said:

Unfortunately I do not have another £6,000 spare to buy a brand new car so financing would only be the option for the newer car.

Just to clarify, is the £20k the extent of your funds, or the extent of a sensibly-calculated car budget? If the former, then seriously consider if dropping £20k on a car is the right choice.

Not trying to be a killjoy or snobbish (although it may sound like it), but I'm guessing a £26k brand new Audi isn't the stuff of petrolhead dreams, so I would counsel against dropping all your available funds on such a car. If it is your dream car then fair enough.

On any options you consider, have a look at Total Cost of Ownership - what is the PCP going to cost you over 2 years (including getting out of a 4 year deal halfway through) compared to buying a nearly new car and what you may be able to sell it for 2 years down the line.

As mentioned above, if you need to get some finance, a loan is likely to be one of the cheapest routes.

[MC Bodge]

Justin Case said:

Let the laws of supply and demand work in your favour. Every month there are thousands of three year old Audis coming onto the market at the end of their leases, so prices will be lower than for a two-year old with relatively few coming onto the market. You should be able to get a 40,000 mile example for about £14k or a higher mileage one for about £12k. Less to borrow means that you can pay it off quicker with the same monthly outlay and really save on the interest payments

A lot of people believe that this is not as cheap as a new lease or HP/PCP.

For someone who keeps a car ~4 years, home services, possibly does a bit of tinkering/improving and isn't fussed about getting it dirty or stone chips/scratches, an ex-lease car makes more sense.

[berlintaxi]

xRIEx said:

Just to clarify, is the £20k the extent of your funds, or the extent of a sensibly-calculated car budget? If the former, then seriously consider if dropping £20k on a car is the right choice.

Not trying to be a killjoy or snobbish (although it may sound like it), but I'm guessing a £26k brand new Audi isn't the stuff of petrolhead dreams, so I would counsel against dropping all your available funds on such a car.

Yeah, spunk it on 3 old cars instead. Seriously, I'm sure the OP is capable of managing his own finances on his own, why do people feel the need to act as if they are the font of all wisdom?

[xRIEx]

berlintaxi said:

xRIEx said:

Just to clarify, is the £20k the extent of your funds, or the extent of a sensibly-calculated car budget? If the former, then seriously consider if dropping £20k on a car is the right choice.

Not trying to be a killjoy or snobbish (although it may sound like it), but I'm guessing a £26k brand new Audi isn't the stuff of petrolhead dreams, so I would counsel against dropping all your available funds on such a car.

Yeah, spunk it on 3 old cars instead. Seriously, I'm sure the OP is capable of managing his own finances on his own, why do people feel the need to act as if they are the font of all wisdom?

My cars didn't cost me e.g. 90% of my funds, nor £20k. It was simply a request for clarification of a statement the OP made. I'm not suggesting the OP can't manage his own finances but I'm open to the possibility given that there are people who can't.

As for font of all knowledge, maybe I should now go sleuthing through your profile for evidence of pontification, because offering suggestions is bad and should be discouraged on a forum when someone asks advice.

[magnitude12]

Thanks for the replies everyone.

I think I might go ahead with leasing. The only thing I dislike about it is the commitment, least with a PCP deal I can exit the agreement at anytime and settle the amount owed (expense way I know).

I rang up a leasing company, they told me this deal for 24 months.

Same Audi, brand new fully loaded with extras
£300.00 a month
6 months deposit £1800
24 month contract

Which is a total of £9,000. So I'm not sure, if i bought the 20k car, in 2 years time surely the car wouldn't have lost £9,000. As I read with leasing I'm essentially paying the depreciation of a new car.

[TA14]

Doesn't an initial six month deposit mean that the total paid, assuming no damage to the car, is 24 x 300 = 7200?

[magnitude12]

TA14 said:

Doesn't an initial six month deposit mean that the total paid, assuming no damage to the car, is 24 x 300 = 7200?

Unfortunately not

I have to put 6 months upfront, then pay 23 months.

So it's 6 months = £1800, then 23 months at £6900

They write it like 6 + 23

[TA14]

magnitude12 said:

TA14 said:

Doesn't an initial six month deposit mean that the total paid, assuming no damage to the car, is 24 x 300 = 7200?

Unfortunately not

I have to put 6 months upfront, then pay 23 months.

So it's 6 months = £1800, then 23 months at £6900

They write it like 6 + 23

Oh dear. So it is nearly £9K. If the car is £20K at a dealer then a private sale might be £17.5K and after two years a private sale might be £11K so your rough figures and guesses seem about right to me.

[mcflurry]

magnitude12 said:

Which is a total of £9,000. So I'm not sure, if i bought the 20k car, in 2 years time surely the car wouldn't have lost £9,000. As I read with leasing I'm essentially paying the depreciation of a new car.

Whether you lease or PCP, you're paying the depreciation, albeit in a different way
If you buy the 2 year old for £20k, will it realistically sell in 2 years for £11k ?
Or how much does a 4 year old trade in today?

(I am not an Audi dealer)

[jonm01]

magnitude12 said:

Thanks for the replies everyone.

I think I might go ahead with leasing. The only thing I dislike about it is the commitment, least with a PCP deal I can exit the agreement at anytime and settle the amount owed (expense way I know).

I rang up a leasing company, they told me this deal for 24 months.

Same Audi, brand new fully loaded with extras
£300.00 a month
6 months deposit £1800
24 month contract

Which is a total of £9,000. So I'm not sure, if i bought the 20k car, in 2 years time surely the car wouldn't have lost £9,000. As I read with leasing I'm essentially paying the depreciation of a new car.

Do you really need all the extras though? That will bump up the price. I don't think there are ever many decent Audi lease deals either. Have you looked at a similar Merc or BMW?

[magnitude12]

Realistically I think in 2 years time the Audi would depreciate and be worth around £13/14k.

I just need to buy a low milage 2012 plate, n hope I can buy it for £19k. I hardly do any miles a year as I do not need to commute to work. So leasing imo would be a waste as i don't do 10k miles a year. Around 5-6k miles.

I think I just have to be patient and wait for a private seller to list their vehicle at £20k, and offer £19k with my own money.

[magnitude12]

jonm01 said:

Do you really need all the extras though? That will bump up the price. I don't think there are ever many decent Audi lease deals either. Have you looked at a similar Merc or BMW?

Merc lease deal is this

Standard C class coupe

24 months
£250 a month
6 months deposit = 1500

which comes to a total of £7500.

But disadvantages, I'm stuck within a contract. And I believe if i bought a 2012 outright it would be around 14/15k when i go to sell it in 2 years time.