With COE prices falling in recent months, used cars are becoming a more attractive proposition for those looking for an affordable ride. Should you buy or not? We work out the good and bad points so you can decide better.
It may seem like a better idea to get a cheaper used car when you’re tight on funds. But bear in mind you have to fork out 40% or 50% of the price in cash as down payment.
The value of a car dives as much as 20% in the first year. Subsequently the rate of depreciation declines more gradually, which is why some people prefer to buy a used car. Of course, it pays to shop around and do your research, simply because the depreciation rate for some used cars are still steeper, especially higher end models purchased with a larger COE premium.
Sure, there are plenty of new cars to choose from but you are still restricted by what the dealer has in stock, as certain models are not available in Singapore or have been discontinued by the manufacturer. If nothing on the current market catches your fancy, consider the world of used cars, which could offer an even greater selection.
One of the benefits of buying a used car is inheriting perks from the previous car owner. These may include a sleek entertainment system or accessories such as in-car cameras. Some owners may even go the extra mile and refresh the exterior with a sporty body kit or upgrade the interior with new seats before parting ways with the car. You could save a bundle if these perks are what you’re looking for.
This is probably the biggest concern. A car is not ageless as the mountains; these older models require more attention after years of wear and tear. In addition to more frequent car servicing, some parts may even need replacement. These are extra costs, which you should keep in mind when calculating your sums.
6) Ease of Mind
Unless you deal directly with the car owner, buying a used car from a general car dealer would mean you wouldn’t have a clue about the car’s history. While you shouldn’t be expecting the new car smell, you should still be discerning and inspect the car’s condition thoroughly before buying.
A used car has less than the full 10-year COE lifespan of a new car. Although there is an option of renewing the car’s COE after its expiry date but if you’re not planning to do that, expect to fork out money again for another car in a few years’ time.
Depending on the car you buy, you may have to pay a little bit more for car insurance. Car insurance premium usually increases with the age of the car. But this is not really a hard and fast rule as many other variables can come into play. So check with the insurance companies before you hop on dream used ride or compare car insurance on GoBear!