Smart Car ownership. Buy and keep long term vs Trade often.

[Barrabart]

G'day all,

Just wondering on what peoples thoughts are on this. The Mrs and i are looking at buying a new hatch back run around car, we are looking at buying a new one.
My questions are.

If buying new, is it best to trade the car every few years before warranties etc expire and the klms get too high, therefore keeping your self in a new car with capped price servicing etc? Or is this a bit of a false economy.
Or buy new and keep long term....

Anyone have any thoughts or experience with this..... appreciate your feed back.

[markpeh]

Good question! The trick is to offload it before it costs money in repairs...

[Nomad]

I bought the mrs a tras(h)tra in 2006. Pre kids. It cost 21K. Seriously my wife could drive past a sign twice and hit it twice....which she has done.

Two kids and absolutely no love later and finally getting to near 90km. Its due to be sold. But I can't be bothered going and looking.

If its a second car and you don't need to fund it just buy it and kill it. My opinion differs if its work related and tax deductible.

Cheers Nomad. 

[D4D]

Lot's of variables and factors here, my thinking is buy new once and keep it till it dies. We bought a new Corolla in '09 primarily for the missus and a city run about. We got it at gold fleet pricing on a fully maintained lease, cheap. We bought a Corolla as they have great resale if we want to offload it but it will go for ever if we decide to keep it. If Rudd's FBT laws get passed then kiss any fleet prices goodbye. If you can offset the car costs via work then replace every 3-5 years with a new one to get the max tax deduction. If you can't claim on tax then it is not worth replacing a perfectly good car every 5 years.

[ozstickman]

I look at it this way, you have to weigh up the costs of repairs for say 3 years to what you,pay in payments for a new car for three years.

That's just my thinking

[02-SR5]

Our tug is a 2011 Challenger.

My second car is a 2008 Hyundai Getz. It costs nothing to run and is worth F all.

Going to keep it till it dies.

Can't see the point on spending money something just to upgrade every couple of years.

[Garfish]

Buy and kill. 

On average cars lose approx 45% of its value over the first 3 years with most in the 1st year.

Given this if there is no reason for this to turn it over I would keep and kill and also consider from purely a cost per year do you need new

[Ynot]

We keep and kill our second car but probably change our main one over about 4 years. I would nearly argue the keep and kill is a better option.


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[McGirr]

If I was buying a new car I would buy one with the best warranty. Forget resale, it's not there.

Mark

[Barrabart]

Righto, thanks all for the feedback........... We are looking at buying a Toyota Yaris, so being a Toyota for a start i'm hoping this will hold it in the good reliability feild...... We test drove also a Holden Barina & a Mitsubishi Mirage, and the Toyota was head and shoulders above these as far as comfort, in cab noise goes.... and i even fit in it, so that's a bonus...
Yep, so i reckon i'll stick with the buy it and drive it into the ground idea......

Oh and it's got to be pink too, so that limits the feild a bit, hence why other cars weren't test driven............ Tell ya, i'm really looking forward to driving it around, reckon i'll look extra tuff!! 

[GeeTee]

lol.. I love the term 'keep and kill'!

Buy a top-line model at three years old. It will be 50 percent of the new price. Keep it forever. People often mention 'cost of repairs' but these days, cars hardly ever break down. Even a cheap Shitbox will do 200,000km with nothing more than an oil change every 10,000km, brake pads every 50K and maybe a fuel pump every 150K.

Oh, and whatever it is you are looking at... buy the Toyota.

[nab]

The missus bought a Honda Jazz new in 2007. Still have it, almost 60,000km and not a single cent apart from 10,000km services, new tyres and battery at the start of the year. Bought it with cash so no loan payments.

We now have 3 kids so it isn't the most practical for us but it isn't worth selling for the $7-8k we would get for it(if we're lucky). Just keep it as the runabout now.

[Barry G]

lol.. I love the term 'keep and kill'!

Buy a top-line model at three years old. It will be 50 percent of the new price. Keep it forever. People often mention 'cost of repairs' but these days, cars hardly ever break down. Even a cheap ****box will do 200,000km with nothing more than an oil change every 10,000km, brake pads every 50K and maybe a fuel pump every 150K.

Oh, and whatever it is you are looking at... buy the Toyota.

Buying good second hand has always been the smart strategy IMO. Especially for those of us not in a position to have everyone else pay for our car through tax minimisation.
The one potential problem with this strategy these days is the electronic everything in cars, which are far more likely to give out and cause trouble than the mechanicals.  Eg window winders and door locks.

[Nomad]

Righto, thanks all for the feedback........... We are looking at buying a Toyota Yaris, so being a Toyota for a start i'm hoping this will hold it in the good reliability feild...... We test drove also a Holden Barina & a Mitsubishi Mirage, and the Toyota was head and shoulders above these as far as comfort, in cab noise goes.... and i even fit in it, so that's a bonus...
Yep, so i reckon i'll stick with the buy it and drive it into the ground idea......

Oh and it's got to be pink too, so that limits the feild a bit, hence why other cars weren't test driven............ Tell ya, i'm really looking forward to driving it around, reckon i'll look extra tuff!! 

Pre the trashtra and kids the mrs had an echo two door. Was a little go cart. We had that for about 5 years and 100km's before we sold it to her boss for a delivery car, he is still thrashing it.

That should be a good car to kill.

[achjimmy]

Do your homework well and know values. Thinking secondhand is best value is old school thinking, it depends. Give you a Toyota example, I knew the sales manger of a large inner city dealership. Corrollas were $25k or something, he would bend over and do them at $21500-$22,500 DA, pending monthly bonus and the punters ability. He had two registered demos to clear (5500km & 8000km) instead he moves them to the used car lot across the road where he got $24,000 & $24,500 for them , plus the new owners would have to pay stamp and transfer! There's is people out there that will still tell you that a car looses ex the moment you drive it away etc sometimes it's true.

[Alan Loy]

The other advantage of keep and kill is that when the value of the the car is low you can stop paying for comprehensive insurance and move to cheaper 3rd party property.  This is saving us more than $500 per year.

[GeeTee]

Buying good second hand has always been the smart strategy IMO. Especially for those of us not in a position to have everyone else pay for our car through tax minimisation.
The one potential problem with this strategy these days is the electronic everything in cars, which are far more likely to give out and cause trouble than the mechanicals.  Eg window winders and door locks.

The thing that kills some leccy bits is not being used. They seize. When I had four-doors (falcodores) I used to 'exercise' the rear windows every time I started the car...Down/Up!
But there are plenty of 20 and 25-year old cars out there where everything still works

another tip for you Barrabart is to buy a high-kay newer car - eg: 3 years and 100,000km old. Brakes and dampers may need replacing, but heavy use early in its life won't have much effect on its long-term reliability but it can be bought for far less that 'market price' ...  and the neighbours won't know the difference   
 

[achjimmy]

The thing that kills some leccy bits is not being used. They seize. When I had four-doors (falcodores) I used to 'exercise' the rear windows every time I started the car...Down/Up!
But there are plenty of 20 and 25-year old cars out there where everything still works

another tip for you Barrabart is to buy a high-kay newer car - eg: 3 years and 100,000km old. Brakes and dampers may need replacing, but heavy use early in its life won't have much effect on its long-term reliability but it can be bought for far less that 'market price' ...  and the neighbours won't know the difference 

I think it's fair to say lots of bits on cars when not used regularly fail prematurely. Oil seals, brake seals etc.

[GeeTee]

I think it's fair to say lots of bits on cars when not used regularly fail prematurely. Oil seals, brake seals etc.

yes you are right, I dabble in classic cars and the less you use them the more trouble they give 

[chisel]

Just a trade off between repair costs and depreciation.  Newer cars have higher depreciation, older cars have higher maintenance/repair costs.

If you need your car on the road 99% of the time or just don't like the hassle of issues with your car then buy new(er).

I'm sure an older car is a bit cheaper overall.

[Bird]

if its European, get rid of it every 3yrs or when lease runs out



I dont see the big issue with Rudds RBT thing... isnt the only change that you have to keep a log book - which your supposed to anyway??? Who says it has to be accurate or honest - like it is now... what am I missing here.

[achjimmy]

if its European, get rid of it every 3yrs or when lease runs out



I dont see the big issue with Rudds RBT thing... isnt the only change that you have to keep a log book - which your supposed to anyway??? Who says it has to be accurate or honest - like it is now... what am I missing here.

Currently you chose between keeping a log book or a statutory method of paying the FBT. He wants to scrap the statutory method so its compulsory to keep a log book so that FBT will be paid on all personal use. Basically tightening it up considerably. Of course it also increases the red tape that the same guy is now promising to reduce! All taxes have net effect on something, at the moment this has slowed new car sales considerably. Just like the original FBT which started the rot in Australian Manufactured cars and spawned the current arrangements of car allowance and Salary sacrifice. This arrangement will spawn something else, that a then greedy government will want to get in on.

[Alan Loy]

If you look at the cost of running cars on LPG then Falcons/Commodores make a lot of sense. 

They are cheaper to run than anything larger than a light car http://www.racq.com.au/motoring/cars/car_economy/vehicle_running_costs_2013#largecars

You can pick a 3 year old one with less than 100,000kms up for less than $15000

Easy to find parts and mechanics over the long term

[WilSurf]

We bought a Fiesta 2.5 years ago on a Novated lease through work.
It is the school-shopping-swimming pool-driving carIt has now 55,000 kms and still going, although on ots third clutch which were all replaced under warranty in the first 4 months. 
Anyway, when I left the company, we paid off the lease.
The intention was to replace it at the end of the 3-year lease, but now we will keep it a bit longer.
The wife wants something else, but the car isn't that bad.
Only downsides are:
- no spare wheel
- no power with the A/C running

But it is very zippy on fuel with 6.1 / 100 k average.
Better then my LX470........

[Barrabart]

The missus bought a Honda Jazz new in 2007. Still have it, almost 60,000km and not a single cent apart from 10,000km services, new tyres and battery at the start of the year. Bought it with cash so no loan payments.

We now have 3 kids so it isn't the most practical for us but it isn't worth selling for the $7-8k we would get for it(if we're lucky). Just keep it as the runabout now.

Nab,

The car that we are selling to buy this new Yaris is also a Honda Jazz, it's a '06 model, but ours has 204,000klms on the clock, this car served as the run around "Mums Taxi" with 3 older kids (late primary and high school ages), all played different sports, different schools, dropping off to after school jobs, drop around to mates places, the little Jazz has served us well... so with you only having done 60k and yours is a year younger, you have plenty life left in the little beastie yet..