Buying and selling as a hobby
Discussion
I am thinking about starting buying and selling cars, privately as a hobby. My thoughts are buy new, ish (under 10,000m) cars from auction and keeping them for about three months before selling them on. My thought is that even if I break even it’s a bit of fun at least.
What do you think? The cars will be all 2 owners, including me, all registered in my name (none of this ‘in trade rubbish’.)
theaps.Only thing with auctions is that sooner or later you'll come across a lemon and could loose a fortune on it. Even with new cars like you're thinking of doing it with could have a major mechanical issue or been in an accident and bodge repaired.
Father in law used to do it and made a little profit doing it too but he quit while he was ahead.
Father in law used to do it and made a little profit doing it too but he quit while he was ahead.
OP,
I know a bloke that did this (but with classics) - turned it into a very sucessful busisness, for a year. The second you become a trader, you have the SOGA rules to deal with. Someone bought a 1970's straight 6 Vantage, overrevved it, and my mate had to foot the bill because without a workshop, he couldn't _prove_ it wasn't a defect at time of sale.
However, IMO your premise is wrong. To trade, you have to add value. Dealers do this via convenience / warranty / showrooms (choice). My mate did it by getting mechanically sound cars, and redoing the interiors, sorting all the minor issues (electrics, paint, chrome), then detailing them. What do you intend to bring to the party? If you can't add value, you;ll lose money...
I know a bloke that did this (but with classics) - turned it into a very sucessful busisness, for a year. The second you become a trader, you have the SOGA rules to deal with. Someone bought a 1970's straight 6 Vantage, overrevved it, and my mate had to foot the bill because without a workshop, he couldn't _prove_ it wasn't a defect at time of sale.
However, IMO your premise is wrong. To trade, you have to add value. Dealers do this via convenience / warranty / showrooms (choice). My mate did it by getting mechanically sound cars, and redoing the interiors, sorting all the minor issues (electrics, paint, chrome), then detailing them. What do you intend to bring to the party? If you can't add value, you;ll lose money...
Extra 300 Driver said:
I am thinking about starting buying and selling cars, privately as a hobby. My thoughts are buy new, ish (under 10,000m) cars from auction and keeping them for about three months before selling them on. My thought is that even if I break even it’s a bit of fun at least.
What do you think? The cars will be all 2 owners, including me, all registered in my name (none of this ‘in trade rubbish’.)
The problem is - and its one i'm faced with every day - when people are spending a significant amount on a car of maybe one year old they are expecting trade in facilities and / or finance.What do you think? The cars will be all 2 owners, including me, all registered in my name (none of this ‘in trade rubbish’.)
Also, cars in that price band will depreciate by £300-£500 a month, so you're faced with the conundrum of buying the right car, finding the optimum time to sell it, dealing with potentially a trade in, hoping it hasnt depreciated too much, and all while its dropping in value each month.
Also, you will end up driving cars that you think will sell, rather than cars you want.
Having said all that - it can work - i got my son a 206 2.0HDI Sport for £2600 on the road, drove it three months, sold for £3000. Then an MG ZR, bought for £2000, drove for 3 months, sold for £3000 and now a 1.4 Zetec Fiesta, bought for £1800 on the road, probably worth £2500, but will be £2000 when we sell it.
66comanche said:
OP - be wary of listening to second hand car dealers advice, they are as protective of their sector as anyone!
You are doing it wrong though, buy cars with little depreciation left in them to sell on and do it without the overly inflated prices of stealers.
Hey, i'm a motor trader!!You are doing it wrong though, buy cars with little depreciation left in them to sell on and do it without the overly inflated prices of stealers.
Agree with your second paragraph. The market to aim for is much further down - less scope to go wrong and easier sold.
D'oh! Another one of my secrets given away.
"relatively" easy to do, but difficult with what you plan to buy.
As has been said, they are new enough to still have loads of depreciation left in them, so you could lose quite a bit quite quickly!
And why do used car dealers always say its not worth getting in to?
Every used car dealer I know appears to be doing ok out of it!
As has been said, they are new enough to still have loads of depreciation left in them, so you could lose quite a bit quite quickly!
And why do used car dealers always say its not worth getting in to?
Every used car dealer I know appears to be doing ok out of it!
sim16v said:
"relatively" easy to do, but difficult with what you plan to buy.
As has been said, they are new enough to still have loads of depreciation left in them, so you could lose quite a bit quite quickly!
And why do used car dealers always say its not worth getting in to?
Every used car dealer I know appears to be doing ok out of it!
Are my posts invisible or something?? I'm selling 25 cars a month which isnt bad for a sole trader, so i'm doing something right??As has been said, they are new enough to still have loads of depreciation left in them, so you could lose quite a bit quite quickly!
And why do used car dealers always say its not worth getting in to?
Every used car dealer I know appears to be doing ok out of it!
Theres stunningly little money in nearly new cars - its so price competitive - thats why.
Also, people will want trade in and finance facilities at that price point - something the O/P cant offer.
daemon said:
There is no limit as such. Well none set by anyone of significance.
If you are buying with a view to making a profit then you are a trader.
True, but I believe the OP is just planning on buying a few cars as a hobby & not particularly trying to make a few quid.If you are buying with a view to making a profit then you are a trader.
As long as he makes no, or very little, money he should theoretically be able to buy & sell as many as he wants.
2thumbs said:
daemon said:
There is no limit as such. Well none set by anyone of significance.
If you are buying with a view to making a profit then you are a trader.
True, but I believe the OP is just planning on buying a few cars as a hobby & not particularly trying to make a few quid.If you are buying with a view to making a profit then you are a trader.
As long as he makes no, or very little, money he should theoretically be able to buy & sell as many as he wants.
I have done this over the last 3 or 4 years but havent had anything too new. I started with my FQ300 when I bought it at xmas time and sold it in summer for £2k more then thought Id just spend the £2k and buy a barge (A8 3.7) instead of spending loads. In the last 3 years Ive not spent anymore than my first £2k but now have a 54 plate ML55.
As for insurance I just kept tranfering the policy to a new car for an admin fee.
As for insurance I just kept tranfering the policy to a new car for an admin fee.
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