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BlogWhen to buy a new car

When to buy a new car

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The flawless paintwork, the performance options, the ride, the comfort, and that smell. There is so much to like about buying a new car. But no-one likes paying top dollar so planning ahead can make a noticeable difference to the price tag.

Aside from buying a home or investment property, buying a car is likely to be the biggest purchase most people make. Unfortunately, it has its share of pitfalls unless you do your homework to give yourself the best chance of negotiating a good deal on the vehicle of your choice.
Feeling like you paid too much is a sure way to take the gloss off your shiny new toy so the best bet is to be an informed buyer and use the calendar to your advantage.

First things first. Set your budget and get pre-approved finance for your new car purchase. Factor in running costs, registration and insurance to make sure you can afford the wheels you’ve set your heart on.

Having your car loan pre-approved

It's a great bargaining tool and it will also help you to feel empowered in your negotiations with the sales person. It helps you to be able to drive a hard bargain if you are not at the whim of dealer finance.

Identify what type of car you want but stay flexible on colour and options

If you are willing to buy off the lot it adds to your bargaining power. You also won’t have to wait for dealer delivery.
You can get a good deal by making sure time is on your side, too. Many car makers and bigger dealerships have mid-year sales at the end of the financial year. You can also count on end of calendar year sales to clear out the current models and make way for the new year’s stock. This is a good time to secure a package with extra options, like an upgraded finish, at no extra cost.

It also pays to bear in mind that car salespeople are paid volume bonuses for reaching sales targets each month. That means towards each month’s end they may be more motivated to lock in a deal to secure their quota.

If you do choose to use in-house finance, make sure the interest rate is competitive with what’s available from other lenders. Dealer finance means more profit back to the dealer so it could be more leverage for a better price. However, this could be a double-edged sword so take care not to sign up to a higher interest rate or an inflexible loan with extra fees and charges. It could mean you pay significantly more in the long run for the sake of saving a few dollars off the ticket price. Similarly, if the in-house finance deal seems very cheap, spend a bit more time investigating how the dealer arrived at the price attached to the car. It may be inflated, or the cheap finance may preclude you from negotiating on the ticket price.

Be sure to shop around for your insurance too. Compare quotes and read the Product Disclosure Statement to check for hidden nasties. Put us on your shopping list to see how we stack up on price and features.
Be wary also of signing up to an extended service plan or other upsells like paint guards, rustproofing, window tinting, fabric treatments and car alarms. Chances are they will ratchet up the final bill and not deliver you value over the life of the vehicle.

Above all, shop around car yards and online to get a selection of quotes. Take the quotes in hard copy to your preferred dealer and push them to meet the price. Ultimately, if you can’t get the deal you are after be prepared to walk away.

Perhaps expand your options and look for demonstrator models. You could also monitor auction houses for low mileage late model vehicles. These come up often in fleet sales and when lease holders choose to turn over their car rather than pay out the balloon.

There is always another deal to be had. Don’t let your money burn a hole in your pocket.

By Marie Mortimer

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