How the hell do people afford cars these days?
Discussion
Zj2002 said:
Yes, people differ. Some are smug a
holes, some are not.
I don’t think it’s smug to look askew at adults choosing to spend all of their wages every month if that includes having a new car but no savings.holes, some are not. I’d feel a near-constant sense of panic if being out of work for six months would cause me financial issues.
okgo said:
It’s 2024, so yes, it’s 12 years old. It feels and drives just like any new car IMO (it has 30k on the clock which may help), it has a 1.4 turbo as you describe, it doesn’t have a heated steering wheel but it isn’t lacking IMO. It isn’t a MERCEDES so people won’t think I’m SUCCESSFUL, but it’s been a great car and I’m not buying this nonsense that used cars cost a fortune to run.
My wife said she is embarrassed by our car because most people we know that have cars have the standard q5/7/Tesla/X3/5 etc etc - I told her the greatest trick the golf ever pulled off is that it (a bit like the Mini) can fit in anywhere
- she’s a victim of marketing quite clearly.
How few miles do you do if your 12 year old car has only done 30k miles? Start putting some proper miles on a car and you can expect some further depreciation. My wife said she is embarrassed by our car because most people we know that have cars have the standard q5/7/Tesla/X3/5 etc etc - I told her the greatest trick the golf ever pulled off is that it (a bit like the Mini) can fit in anywhere
- she’s a victim of marketing quite clearly. If you bought it 4 years ago that would be pre-covid (or early covid), so you have benefitted from the recent car price inflation.
In my experience of running older cars with with higher annual mileages and normal depreciation you would be surprised how much they can cost in total to run.
Edited by FamousPheasant on Tuesday 7th May 17:18
I've tried most methods of car "ownership" over the years and settled on leasing being my preferred option, assuming you jump on a decent deal.
My first lease followed on from a PH favourite "buy cash at 3 years old and run for 6 years" and all in worked out cheaper.
Shedding is almost certainly the cheapest way of motoring but it gets a bit wearing having to fix things and some normal wear and tear type stuff to get through an MOT can easily exceed the car's value.
Overall it's like anything else. Some people have nice watches, some have expensive push bikes, some collect stamps.
My first lease followed on from a PH favourite "buy cash at 3 years old and run for 6 years" and all in worked out cheaper.
Shedding is almost certainly the cheapest way of motoring but it gets a bit wearing having to fix things and some normal wear and tear type stuff to get through an MOT can easily exceed the car's value.
Overall it's like anything else. Some people have nice watches, some have expensive push bikes, some collect stamps.
okgo said:
It isn’t a MERCEDES so people won’t think I’m SUCCESSFUL
You're judging others by your own standards. It's entirely possible to buy a car without giving a st about what other people think.Or should people not buy a Merc in case someone they don't know may think they buy it to appear successful
nickfrog said:
You're judging others by your own standards. It's entirely possible to buy a car without giving a st about what other people think.
Or should people not buy a Merc in case someone they don't know may think they buy it to appear successful
The premium car brands have all cottoned onto the fact 99% people don't care what the actual car is like, as long as it has the right badge. Including the woman on the last page I'd imagine, I'm sure whatever the VW version of an X3 is costs less, is as capable/nice place to be, but wrong badge ;-)t about what other people think.Or should people not buy a Merc in case someone they don't know may think they buy it to appear successful
I have bought a car without giving a s
t what people think, you don't need to tell me.My brother is a good example. Has two fairly new german cars on the driveway of his ex local house. Wants to move because, shock horror, all the neighbours are grim, but hasn't yet engaged his brain to realise that with £750 of payments going to these two (again, totally forgettable) cars, he has limited his affordability to do anything. But flogging the cars and buying a couple (or one, given they work in the same location) of cheap runabouts isn't on the table apparently. Moronic.
Lil_Red_GTV said:
ARHarh said:
Why do you all assume an old car will throw massive bills?
I have always bought cars at about 8 to 12 years old, since my first car in 1980. Many have well exceeded 150k miles by the time I let them go. Ok i fix them myself but have rarely had bills of more than a couple of hundred quid, if i had to pay labour that would would probably double the cost. Yes there is a risk, but if you keep an eye on things and service properly the chances of the cost of repair being more than cost of replacement, is minimal.
I can see some not liking the worry your car might break down but that can even happen on new cars, it why breakdown services exist.
Experience! It may be bad luck, but on the several older cars I have run, I would say about £1000-1500 a year in repair costs has been fairly typical. That's doing minor things like bulbs myself but using indy garages for everything else.I have always bought cars at about 8 to 12 years old, since my first car in 1980. Many have well exceeded 150k miles by the time I let them go. Ok i fix them myself but have rarely had bills of more than a couple of hundred quid, if i had to pay labour that would would probably double the cost. Yes there is a risk, but if you keep an eye on things and service properly the chances of the cost of repair being more than cost of replacement, is minimal.
I can see some not liking the worry your car might break down but that can even happen on new cars, it why breakdown services exist.
I've looked at a few ~12 year old cars, around the £5k mark and seen 'corrosion' in the MOT advisories.
There is a shortage of good cheap cars.
We are moving into an era where 10 year old cars will be hard to get through the MOT due to emissions, and things like wet cambelts and complicated transmissions will start to bite people.
The depreciation curve for cars used to flatten out with bangers being worth £300 with an MOT and a grand with 5 years life left.
Now we are seeing £3k cars which could be worthless in 12 months or less.
It could actually be cheaper per year to buy something nearly new and keep it a long time.
The margins of buying and selling are significant now, dealers can't knock their trade-ins out the back door for a small mark-up any more, due to 'consumer rights'.
ARHarh said:
Why do you all assume an old car will throw massive bills?
I have always bought cars at about 8 to 12 years old, since my first car in 1980. Many have well exceeded 150k miles by the time I let them go. Ok i fix them myself but have rarely had bills of more than a couple of hundred quid, if i had to pay labour that would would probably double the cost. Yes there is a risk, but if you keep an eye on things and service properly the chances of the cost of repair being more than cost of replacement, is minimal.
I can see some not liking the worry your car might break down but that can even happen on new cars, it why breakdown services exist.
Depends on the car.I have always bought cars at about 8 to 12 years old, since my first car in 1980. Many have well exceeded 150k miles by the time I let them go. Ok i fix them myself but have rarely had bills of more than a couple of hundred quid, if i had to pay labour that would would probably double the cost. Yes there is a risk, but if you keep an eye on things and service properly the chances of the cost of repair being more than cost of replacement, is minimal.
I can see some not liking the worry your car might break down but that can even happen on new cars, it why breakdown services exist.
Large SUVs will start throwing big bills at that age as will large German saloons.
To be fair, the newer stuff is getting better. So I'd be slightly less concerned about a 2014 X5 than I would have been about a 2007 X5 when it was 10 years old.
Engines, transmissions, drive shafts, transfer cases, suspension components, DPFs, EGRs, coolant leaks, oil leaks(!), stretched timing chains, electrics....I could go on.
Many of these cars have specific faults which you'd only know about with research.
Most people still don't know that crankshafts commonly snap on 3.0 diesel Land Rovers....
Browter said:
Is everyone on this thread aware you can PCP new AND used cars and the interest rates vary between 0% to around 13%? PCP as a concept is not inherently evil. The downside of some of them I’d say is persuading people to get a ‘nicer’ car than they need by making the monthly seem palatable (but including a chunk of interest) but leaving them with no equity at the end of the term. Financially they would have been better with a HP on something cheaper which they own at the end. But each to their own.
Well exactly. Citroen are currently doing the eC4 at 0% APR for PCP right now (£299 1 + 47, GFV ~10k).I'd say the bigger idiot is the person who buys a car for cash when they could lease it interest free and be, practically, risk free. Only difference is the inability to haggle the RRP down.
cj2013 said:
Well exactly. Citroen are currently doing the eC4 at 0% APR for PCP right now (£299 1 + 47, GFV ~10k).
I'd say the bigger idiot is the person who buys a car for cash when they could lease it interest free and be, practically, risk free. Only difference is the inability to haggle the RRP down.
But then you have to drive a Citroen C4. You could use a loan and pay £250 a month to drive a £15-20k 16 plate Golf R, I30N, 308 GTi, BMW m140i…. Etc. and not have to have the risk of driving a joyless shopping trolley just to reward yourself being ‘risk free’. You’d still have to £10k residual left after 3 years.I'd say the bigger idiot is the person who buys a car for cash when they could lease it interest free and be, practically, risk free. Only difference is the inability to haggle the RRP down.
If today's data from the SMMT is anything to go by then it seems that private buyers are struggling to afford the costs of new cars, private sales of new vehicles down nearly 18%, only fleet sales are showing any positive numbers.
They are blaming EV sales but all makes and models have increased in price at above inflation figures the last few years, it was going to come to that point where prices as we returned to more normal market conditions became too high for your average private customer with PCP the IRs have made them alot more costly and when you add in the new price increases and depreciation that has now returned to the market the monthly numbers are not good, then add in some insurance premium increases and the wider cost of living squeeze.
They are blaming EV sales but all makes and models have increased in price at above inflation figures the last few years, it was going to come to that point where prices as we returned to more normal market conditions became too high for your average private customer with PCP the IRs have made them alot more costly and when you add in the new price increases and depreciation that has now returned to the market the monthly numbers are not good, then add in some insurance premium increases and the wider cost of living squeeze.
nickfrog said:
okgo said:
It isn’t a MERCEDES so people won’t think I’m SUCCESSFUL
You're judging others by your own standards. It's entirely possible to buy a car without giving a st about what other people think.Or should people not buy a Merc in case someone they don't know may think they buy it to appear successful
Edited by Shnozz on Tuesday 7th May 21:19
cj2013 said:
Well exactly. Citroen are currently doing the eC4 at 0% APR for PCP right now (£299 1 + 47, GFV ~10k).
I'd say the bigger idiot is the person who buys a car for cash when they could lease it interest free and be, practically, risk free. Only difference is the inability to haggle the RRP down.
You think paying £14,400 to lease a car for four years that you can buy outright for £19,000 is the best way to go?I'd say the bigger idiot is the person who buys a car for cash when they could lease it interest free and be, practically, risk free. Only difference is the inability to haggle the RRP down.
Theoldguard said:
If today's data from the SMMT is anything to go by then it seems that private buyers are struggling to afford the costs of new cars, private sales of new vehicles down nearly 18%, only fleet sales are showing any positive numbers.
They are blaming EV sales but all makes and models have increased in price at above inflation figures the last few years, it was going to come to that point where prices as we returned to more normal market conditions became too high for your average private customer with PCP the IRs have made them alot more costly and when you add in the new price increases and depreciation that has now returned to the market the monthly numbers are not good, then add in some insurance premium increases and the wider cost of living squeeze.
How do you know people are 'struggling to afford' new cars?They are blaming EV sales but all makes and models have increased in price at above inflation figures the last few years, it was going to come to that point where prices as we returned to more normal market conditions became too high for your average private customer with PCP the IRs have made them alot more costly and when you add in the new price increases and depreciation that has now returned to the market the monthly numbers are not good, then add in some insurance premium increases and the wider cost of living squeeze.
Lots of people I know could easily afford a new car, but they don't actually want one.
There are plenty of other things to spend your money on.
Some people seem to have lost interest in having the latest model.
Some people have less need for a car, due to working from home. They may have a 3 year old car on the drive which is really low mileage but the trade-in they are offered is offensive compared to the cost of new.
If the major thing in the market was people decling to get new cars, then there would be a shortage of 3 year old cars. We're not seeing that.
What we are seeing is more fleet cars. Less private sales, slight growth overall.
That seems to suggest some people are choosing to have a company car when a few years ago they might have opted for the car allowance?
pb8g09 said:
But then you have to drive a Citroen C4. You could use a loan and pay £250 a month to drive a £15-20k 16 plate Golf R, I30N, 308 GTi, BMW m140i…. Etc. and not have to have the risk of driving a joyless shopping trolley just to reward yourself being ‘risk free’. You’d still have to £10k residual left after 3 years.
£15k loan at £250/month = 60 months, or 5 years.How much is it then going to cost to maintain (servicing, repairs) and fuel those cars over those 5 years.
Incredibly optimistic a '16 plate Golf R is going to be worth £10k after 3 years, considering there are '12 plate Golf R's for under £9k on AT.
Regardless, typical PH strawman to have a thread discussing how the general public can't afford to buy a new car, only to be countered by a solution with "But that's stupid when you could buy something fast, old, and unreliable on finance instead!"
OutInTheShed said:
How do you know people are 'struggling to afford' new cars?
Lots of people I know could easily afford a new car, but they don't actually want one.
There are plenty of other things to spend your money on.
Some people seem to have lost interest in having the latest model.
Some people have less need for a car, due to working from home. They may have a 3 year old car on the drive which is really low mileage but the trade-in they are offered is offensive compared to the cost of new.
If the major thing in the market was people decling to get new cars, then there would be a shortage of 3 year old cars. We're not seeing that.
What we are seeing is more fleet cars. Less private sales, slight growth overall.
That seems to suggest some people are choosing to have a company car when a few years ago they might have opted for the car allowance?
We are in a fortunate position where we own both our vehicles outright (both worth about £15k) and have no other debts than the mortgage so could easily afford brand new cars on lease/PCP. My wife wants a newer car (current one is 9 years old) and we decided to go down the EV lease route costing around £200pm if you factor in fuel savings and we then stick the £15k the current car is worth in the bank earning some interest.Lots of people I know could easily afford a new car, but they don't actually want one.
There are plenty of other things to spend your money on.
Some people seem to have lost interest in having the latest model.
Some people have less need for a car, due to working from home. They may have a 3 year old car on the drive which is really low mileage but the trade-in they are offered is offensive compared to the cost of new.
If the major thing in the market was people decling to get new cars, then there would be a shortage of 3 year old cars. We're not seeing that.
What we are seeing is more fleet cars. Less private sales, slight growth overall.
That seems to suggest some people are choosing to have a company car when a few years ago they might have opted for the car allowance?
10 years ago we had two £300pm lease/PCP cars but when we looked at what it cost over a 3-4 year period paying depreciation alone, it made me realise it wasn't worth it just to own a brand new car.
All cars depreciate, used ones just depreciate less overall but they still do depreciate.
I can't see how a brand new car on a PCP/Lease is ever going to be cheaper than buying a used car over a 3 year period, even when you account for maintenance but if nobody bought brand new cars, there would be no used ones for everyone else down the line!
People generally buy a car because they need one. A car is going to be less than you paid for it when you come to sell it several years down the line. Most used cars don't cost anywhere near what a brand new one one, even accounting for maintenance (unless you happen to be very unlucky)
Wagonwheel555 said:
....
I can't see how a brand new car on a PCP/Lease is ever going to be cheaper than buying a used car over a 3 year period, even when you account for maintenance but if nobody bought brand new cars, there would be no used ones for everyone else down the line!...
Try looking at the depreciation from:I can't see how a brand new car on a PCP/Lease is ever going to be cheaper than buying a used car over a 3 year period, even when you account for maintenance but if nobody bought brand new cars, there would be no used ones for everyone else down the line!...
Buy retail at 3 years old
Sell WBAC at 6 years old
The extra cost of having a new car may not be always be that bad.
If you look at it as 'a lot of money' vs ' just a bit more', I ca nsee why some people see it as better value.
More so for peple who are notwell paced to sort issues on cars and don't want to spend their lives dealing with garages.
OutInTheShed said:
Try looking at the depreciation from:
Buy retail at 3 years old
Sell WBAC at 6 years old
The extra cost of having a new car may not be always be that bad.
If you look at it as 'a lot of money' vs ' just a bit more', I ca nsee why some people see it as better value.
More so for peple who are notwell paced to sort issues on cars and don't want to spend their lives dealing with garages.
Fair point but I disagree about the garage thing, people make out used cars spend half their life in a garage which with modern cars, is really not the case. Buy retail at 3 years old
Sell WBAC at 6 years old
The extra cost of having a new car may not be always be that bad.
If you look at it as 'a lot of money' vs ' just a bit more', I ca nsee why some people see it as better value.
More so for peple who are notwell paced to sort issues on cars and don't want to spend their lives dealing with garages.
Many brand new cars have issues, plenty of people have nothing but problems with them.
Many used cars have no issues, our 335D is 9 years old, we have owned it 4 years and not been into a garage once other than its MOT and servicing.
Wagonwheel555 said:
Many used cars have no issues, our 335D is 9 years old, we have owned it 4 years and not been into a garage once other than its MOT and servicing.
But you're talking about running a car between the ages of 4 years and 9 years. A car that would have been, what, £20k-£25k from a dealer at 4 years old. What will WBAC give you for it now? You may have avoided repair bills but you have done that by buying a relatively young used car. You will accordingly have taken a hit in depreciation instead. Try running it for another 5 years and see if it is still trouble free. Lil_Red_GTV said:
But you're talking about running a car between the ages of 4 years and 9 years. A car that would have been, what, £20k-£25k from a dealer at 4 years old. What will WBAC give you for it now? You may have avoided repair bills but you have done that by buying a relatively young used car. You will accordingly have taken a hit in depreciation instead. Try running it for another 5 years and see if it is still trouble free.
I think we were fortunate with the used car market going up, we bought for £18k from a BMW as AUC with only 14k on the clock, was an ex showroom car so private sale now is about £14-£15k based on the mileage and therefore has cost us very little over 4 years of ownership. WBAC is showing £12750 so even at that value, its still only around £110pm depreciation.Gassing Station | Car Buying | Top of Page | What's New | My Stuff