WHY BUY A USED CAR?

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Brokerage WA will assist you purchase a New New Used Car - Our preference is to locate a vehicle still under Manufacturer warranty however we can also work with you on a lower budget vehicle. Our big concern with older cars is quality. It is always best to pay a little more to get a younger car with lower kilometres, one or two owners and detailed service history.

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There are as many reasons to buy a Used Car as a new one. In the used car market there are two distinctly different buyer types.

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The first is economic - these people want the latest, most up to date car, however their financial position may not provide enough to get what they want in a New Car.

The other group have a very practical outlook on life and they just object to paying all that; GST, Luxury Goods Tax, Initial depreciation that is part of a new car purchase. They prefer someone else to take the initial 'hit' and then buy Used Cars as close to new as possible.

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THERE ARE DISTINCT BENEFITS TO USED CAR BUYING

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• The economic benefit is real and proven.

• The selection in most cases is wide and varied.

• A near new Used Car has the benefit of manufacturer warranty - these warranties transfer at no cost to you the buyer for the original term of the warranty. e.g if there is two years left you receive the full benefit of that cover under new car terms.

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CONSIDERATIONS WHEN BUYING USED CARS

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​The majority of Used Car sales occur without issue, however these are some of the things you should take into account when looking for a Used Car:

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• Who owned it and where/how was it driven?

• Accident history - has it been involved in a major accident?

• Service history - has it been serviced, and by who?

• General condition - if it looks unloved it probably is

• Price - there is no "recommend price" for used cars. What is the right price for the Used Car you are considering?

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COVID 19 IMPACT

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The Used Car Market has been profoundly impacted by the effect of COVID 19 on New Car Market.

New cars are in short supply and long timelines.  The manufacturers reverted to a “build to order” process instead of “build to dealer stock targets”.  Some manufacturer delays are exceeding 2 years.

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The Used Car Market is seeing many who would purchase New converting to Used.  This has increased demand for used cars.  The greatest lesson in economics 101 is:

When supply is low and demand high, prices rise.

When supply is plentiful and demand is low, process fall.

COVID 19 has created unprecedented demand for used cars resulting in significantly higher prices, some at +40% over pre-Covid 19.

 

It works like this, in general terms:

• Dealers need stock to sell and are low on stock holding.

• Dealers need to pay more to own cars so they can fill stock needs.

• High demand for used cars continue.

• Prices rise in direct relationship to price paid plus any reconditioning costs.

• Dealers do not need to discount to clear stock as many people want each car offered.

 

Will this change in the future?

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Yes, provided stock flows freely to new car dealers leading to high stock levels across the country, creating more “buyers’ market” pressure – less people wanting the many available cars.

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