Is selling a car always financial suicide?
Discussion
In terms of average cars, not some classic Porsche that appreciates...I understand cars lose value with age and miles, thats reasonable, but does anyone else have a difficult time getting past logical part of their brain that says your pissing money down the drain?
I think my point is more substantial when we talk about older cars that you have spent money repairing them. For example, if you want to sell a car that has a fault you will sell it for a lower value, but if you fix the fault, you are effectively investing your money in someone elses car.
Real scenario, my st220 which I have had a long time and enjoy a lot has done 140k miles and has just had new suspension and a clutch - fair given the mileage. Now I want to try something new, but it seems daft selling a car having just spent £1600 on, that is now mechanically perfect and may do another 100,000 on just consumables.
Am I making sense? I guess its a fact of life, but cant help feel I get "tied" to a car once I start "investing" in its up keeping.
I think my point is more substantial when we talk about older cars that you have spent money repairing them. For example, if you want to sell a car that has a fault you will sell it for a lower value, but if you fix the fault, you are effectively investing your money in someone elses car.
Real scenario, my st220 which I have had a long time and enjoy a lot has done 140k miles and has just had new suspension and a clutch - fair given the mileage. Now I want to try something new, but it seems daft selling a car having just spent £1600 on, that is now mechanically perfect and may do another 100,000 on just consumables.
Am I making sense? I guess its a fact of life, but cant help feel I get "tied" to a car once I start "investing" in its up keeping.
BigMonk said:
In I guess its a fact of life, but cant help feel I get "tied" to a car once I start "investing" in its up keeping.
I think traders suffer from a similar affliction i.e. holding onto losses. A good time to sell is when the marginal benefits of owning a car over and above it's utility begin to decrease, but it is hard to determine when this point is reached. Perhaps after it's first significant 'investment'? - though pyschologically the owner may be less willing to part with refurbed car.Cars depreciate in their earlier to middle life but this is eventually replaced by the repair costs to keep going and to some extent decreased utility - because of perceived or actual reliability (though this happens immediately in the case of French cars). This is also skewed somewhat by the cost of replacement parts and labour rates in this country.
only the 6th f8g edit
Edited by fido on Saturday 5th March 16:25
Like you have said....Unless it is an appreciating classic dont spend to long thinking about it. It will just make your head hurt. If you buy a new car it loses thousand on the way out the dealers gate. If it is an old car you need to spend money on it to keep it going but it is a labour of love. If you were to renew the all the mechanicals including the engine you will still only get what it is seen to be worth to someone else. It is a case of keep it or suck it up
The way I see it, I wouldn't buy a car that hadn't been maintained properly, so when I'm selling, I would expect to have trouble shifting it if it hadn't had any necessary work done.
I appreciate the timing could be better, but it's essentially the same problem - it's your car and you've maintained it as required. If you want to sell it, you'd have had a hell of a job with knackered suspension and clutch...
I appreciate the timing could be better, but it's essentially the same problem - it's your car and you've maintained it as required. If you want to sell it, you'd have had a hell of a job with knackered suspension and clutch...
It's financial suicide if the car you buy is in worse mechanical condition than the one you sell.(and your sounds ok)
You will have paid to repair two cars.
If you feel you really need a change, at least get one more year from it.
During that year, which should be maintanance free, save a little in a car fund towards your next car.
Try to get yourself in a financial position where you can pounce on a good deal.
You will have paid to repair two cars.
If you feel you really need a change, at least get one more year from it.
During that year, which should be maintanance free, save a little in a car fund towards your next car.
Try to get yourself in a financial position where you can pounce on a good deal.
There comes a point where you simply have to write off the value of the car in your own mind.
The £1,600 you've just spent is the cost of using that car for I would say the next 2 years. For £1,600 could you have got anything better?? (possibly, but that's a moot point now you've soent the money).
I recently spent £160 on brakes and then another £200 on suspension bits. That's £360. I intend that to be the cost of keeping the car over the next 9 months to MOT time. When the MOT comes around I'll see if it fails, and then judge the cost of getting it through with respect to what else I can buy, and whether I want to keep it another year. The cost of the car (£700) and repairs/maintenance (About £600) is already "Written off" in my head, because right now I've got a good car which runs really nicely, but is worth bugger all.
It's a fine judgement, and after a big bill we all wonder "is the car worth that?". So long as you keep it a bit, then yes, it's worth it. IT wouldn't be worth spending that on an ST220 to sell it straight away, but if you do 10,000 miles in it now without spending anything else, then the cost of those repairs drops to 16p a mile.
The £1,600 you've just spent is the cost of using that car for I would say the next 2 years. For £1,600 could you have got anything better?? (possibly, but that's a moot point now you've soent the money).
I recently spent £160 on brakes and then another £200 on suspension bits. That's £360. I intend that to be the cost of keeping the car over the next 9 months to MOT time. When the MOT comes around I'll see if it fails, and then judge the cost of getting it through with respect to what else I can buy, and whether I want to keep it another year. The cost of the car (£700) and repairs/maintenance (About £600) is already "Written off" in my head, because right now I've got a good car which runs really nicely, but is worth bugger all.
It's a fine judgement, and after a big bill we all wonder "is the car worth that?". So long as you keep it a bit, then yes, it's worth it. IT wouldn't be worth spending that on an ST220 to sell it straight away, but if you do 10,000 miles in it now without spending anything else, then the cost of those repairs drops to 16p a mile.
I'm in a similar position.
I bought a '99 A4 last year in September. Since then it's had:
New exhaust: £400
Suspension / Brakes: £400
Oil leak repair: £100
4x new tyres: £330
Wheel bearing: £120
So I have spent £1350 on a car that's not even worth that.
But when I weigh this up against depreciation on a new car, I still think I'm ahead
Unlike you though, I'm not trying to sell mine (yet).
I bought a '99 A4 last year in September. Since then it's had:
New exhaust: £400
Suspension / Brakes: £400
Oil leak repair: £100
4x new tyres: £330
Wheel bearing: £120
So I have spent £1350 on a car that's not even worth that.
But when I weigh this up against depreciation on a new car, I still think I'm ahead
Unlike you though, I'm not trying to sell mine (yet).
BigMonk said:
For example, if you want to sell a car that has a fault you will sell it for a lower value, but if you fix the fault, you are effectively investing your money in someone elses car.
Real scenario, my st220 which I have had a long time and enjoy a lot has done 140k miles and has just had new suspension and a clutch - fair given the mileage. Now I want to try something new, but it seems daft selling a car having just spent £1600 on, that is now mechanically perfect and may do another 100,000 on just consumables.
Am I making sense? I guess its a fact of life, but cant help feel I get "tied" to a car once I start "investing" in its up keeping.
Well, if you spend £100 repairing it but that increases the value by £150, then it's worth doing.Real scenario, my st220 which I have had a long time and enjoy a lot has done 140k miles and has just had new suspension and a clutch - fair given the mileage. Now I want to try something new, but it seems daft selling a car having just spent £1600 on, that is now mechanically perfect and may do another 100,000 on just consumables.
Am I making sense? I guess its a fact of life, but cant help feel I get "tied" to a car once I start "investing" in its up keeping.
But no you are not alone, the question is at what time does it become cheaper to just buy a replacement car rather than fix it......
Well next time you reach a point that parts are wearing out you need to think what is the cost of doing all that work how long after that will you keep the car and what an identical car to yours with all work done would cost to buy now.
Then make that choice as you have all the info it's then an educated decision.
Your situation why not keep it for a year ?
I was in your situation but didn't do the repairs. On my fiat coupe 20vt. It needed new cambelt, discs and pads all round, air con condensor, new clutch, new drivers seat, bonnet repair as some idiot reversed into it and gave it a slight dent but a £350 job in isolation, bushes worn and I felt it needed new shocks all round. It would be utter lunacy financially to do all that work as I could have bought a complete car with all that done plus lower miles and six speed box plus I'd had the car 6 years.
Then make that choice as you have all the info it's then an educated decision.
Your situation why not keep it for a year ?
I was in your situation but didn't do the repairs. On my fiat coupe 20vt. It needed new cambelt, discs and pads all round, air con condensor, new clutch, new drivers seat, bonnet repair as some idiot reversed into it and gave it a slight dent but a £350 job in isolation, bushes worn and I felt it needed new shocks all round. It would be utter lunacy financially to do all that work as I could have bought a complete car with all that done plus lower miles and six speed box plus I'd had the car 6 years.
Welshbeef said:
or buy used and don't service or fix just keep roadworthy. Bangeromics.
Yup, there is that, but I've never been that brutal myself. I've run older cars but always paid out in order to keep on top of basic maintenance, mainly to avoid the hassle of it failing on me 300 miles from home or when I need to be somewhere important.
It's incremental and cumulative though. If I'd known what the total outlay on my shed Golf GTI would be over the 2 years I've had it, I might have ditched it at the first hurdle but all cars need parts replacing and once you've done them, you're reducing the chances but once the bits are repaired, the car does everything it needs to again and the need for a new one at greater expense is obviated.
TonyRPH said:
I'm in a similar position.
I bought a '99 A4 last year in September. Since then it's had:
New exhaust: £400
Suspension / Brakes: £400
Oil leak repair: £100
4x new tyres: £330
Wheel bearing: £120
So I have spent £1350 on a car that's not even worth that.
But when I weigh this up against depreciation on a new car, I still think I'm ahead
Unlike you though, I'm not trying to sell mine (yet).
I think you can remove Tyres and Brakes from that equation to make it sound less harsh.. as they are consumables on all cars..I bought a '99 A4 last year in September. Since then it's had:
New exhaust: £400
Suspension / Brakes: £400
Oil leak repair: £100
4x new tyres: £330
Wheel bearing: £120
So I have spent £1350 on a car that's not even worth that.
But when I weigh this up against depreciation on a new car, I still think I'm ahead
Unlike you though, I'm not trying to sell mine (yet).
I have bought both new and used cars over the years.
To keep costs to a minimum, I prefer to buy older well maintained cars which have reached that level of value where depreciation is of little consequence.
It is quite possible to buy a classy older car for about £1000 which has been well maintained and with relatively little mileage covered. Be patient, selective and buy wisely. That way your motoring costs can be paid for largely by the previous caring owner(s) of your cars. Fuel, tax and insurance is always a price we all have to pay but, depreciation is not.
Excluding company cars, I have only bought three new cars for myself during the past three decades. By keeping those new cars for around 7-15 years within the family depreciation has less impact. I would have kept the seven year old car rather longer but, someone knocked on my door and made an offer I could not refuse...
I have bought rather more used cars since I first started driving fifty years ago and well cared for older cars can be exceptional value. My current daily driver is yet another example. Even running and maintenance costs are minimal as I am not afraid to pick up a spanner and get stuck in. Must have saved much this way over all my motoring years. I get more pleasure from my used cars than the new ones.... but then, I'm funny like that ...
Every car I've ever owned has been reliable. Luck does play some part in this but, there's rather more to it than that.
..
To keep costs to a minimum, I prefer to buy older well maintained cars which have reached that level of value where depreciation is of little consequence.
It is quite possible to buy a classy older car for about £1000 which has been well maintained and with relatively little mileage covered. Be patient, selective and buy wisely. That way your motoring costs can be paid for largely by the previous caring owner(s) of your cars. Fuel, tax and insurance is always a price we all have to pay but, depreciation is not.
Excluding company cars, I have only bought three new cars for myself during the past three decades. By keeping those new cars for around 7-15 years within the family depreciation has less impact. I would have kept the seven year old car rather longer but, someone knocked on my door and made an offer I could not refuse...
I have bought rather more used cars since I first started driving fifty years ago and well cared for older cars can be exceptional value. My current daily driver is yet another example. Even running and maintenance costs are minimal as I am not afraid to pick up a spanner and get stuck in. Must have saved much this way over all my motoring years. I get more pleasure from my used cars than the new ones.... but then, I'm funny like that ...
Every car I've ever owned has been reliable. Luck does play some part in this but, there's rather more to it than that.
..
Edited by MGJohn on Saturday 5th March 21:44
My mate and I have just spent most of today working on my daily driver in order that it passes its test.
So far it's had new wishbones and balljoints, new droplinks and anti-roll bar bushes, new track rod ends, new front springs and shocks (osf was snapped
), new rear drums and shoes and handbrake cables, and not forgetting just before winter new front discs and pads and new tyres all round.
So an outlay of about £350 over the last few months, just to get an £800 car through its test.
If I sell it, someone's going to get a better car than I did!
Oh well.
So far it's had new wishbones and balljoints, new droplinks and anti-roll bar bushes, new track rod ends, new front springs and shocks (osf was snapped
), new rear drums and shoes and handbrake cables, and not forgetting just before winter new front discs and pads and new tyres all round.So an outlay of about £350 over the last few months, just to get an £800 car through its test.
If I sell it, someone's going to get a better car than I did!
Oh well.
Welshbeef said:
or buy used and don't service or fix just keep roadworthy. Bangeromics.
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