Quote:
Originally Posted by slizoth
When has buying a new car ever been a good investment? I expect the resale value of the car in 2016 to be 10k-12k, aprox half of the estimated cost of the car. So are you okay thorwing away 4k/yr just to drive something new? Not to mention the cost of gas, insurance, and maintenance. If you are great if you aren't, why are you buying a new car?
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Nobody ever said buying a new car was a good investment. Clearly you don't make money on cars (unless you happened to buy one of a very select few rare and collectible cars and keep it in pristine condition.. ie.. Shelby Cobra, etc. ).
But, I also don't think buying a new car is necessarily much worse than buying a used car. At least if you buy it right.. Let's assume this car is $25k new. I'll pay about $23.5. I'd guess that in 4 years it would be somewhere in the $12k to $14k range with approx 50k miles on it. Remeber that Subaru's hold very high resale values. So expect to have depreciation of anywhere from $9500 to $11500.. so let's call it $2500 per year.
Most used cars tend to depreciate somewhere in the ballpark of $1500 to $2000 per year for a 3-4 year old car. This depends very much on the age of the car and the number of miles of course...
The difference is that you typically have much more maintenance and repair costs on a used car. you could easily spend another $1000 per year on maintenance and repairs.
So in the end, I think you wind up spending a similar amount of money.. either you pay it in pure depreciation, or you pay it in a combination of depreciate and maintenance/repairs. Personally, I'd rather have the new car! I'd even be willing to pay a little more to have the new car over the used car.