Is it better to buy a new or used car in 2024?

Australians are snapping up new cars, especially SUVs and utes. The most popular choice in April was the Toyota Rav4 followed by Ford Ranger and Toyota Hilux. Meanwhile, prices of used cars are starting to fall again. Is it better to buy a new or a used car? We list the benefits so you can decide.

Australians want utes and SUVs

Australians bought 18% more new cars in April 2024 than the year before. That makes 10 record sales months in the past year. More than half were SUVs, like the Toyota Rav4 and just over a fifth were utes, like the Ford Ranger and Toyota HiLux.

The most popular used cars in April were the Ford Ranger, Toyota Corolla and Toyota HiLux. While prices of used cars reached record highs after Covid, they’ve been falling since August 2022. Thanks to high interest rates and the cost of living, prices for used vehicles may fall further. It could be a good time to buy one.

Whether you choose a new or used car depends on which benefits you value most.

Benefits of buying a new car

You may appreciate these benefits of buying a new car:

• Manufacturer warranty lasts 3 to 5, even 7 years, or 60,000 to 100,000 kms
• The latest safety technologies, driver aids and infotainment
• Choice of specs, like paint colour, upholstery options and engine
• More fuel efficiency
• Lower ongoing costs because parts don’t need replacing
• Reliability and less likely to break down.

Benefits of buying a used car

However, there are also benefits from buying a used car:

• Lower cost or a better make and model for the same price
• Less depreciation – new cars lose about 40% of value in 3 years
• Seller may be willing to bargain
• As reliable as newer cars, if well maintained and serviced
• Mileage can be low, eg, demonstrator models.

When buying a used car from a private seller, always check whether it’s under a loan, was previously written off or has a hidden fault.

If you’re still trying to decide, you may wonder about insuring a new or used car.

Is a new or used car cheaper to insure?

By insurance, we mean comprehensive or third party property insurance to cover your car. These costs depend on the driver as well as the vehicle.

While a new car may have lots of desirable features, it costs insurers more to replace it. Look out for these features to bring down the cost of your motor insurance:

• Lower value
• Cheaper to repair
• Easy to replace parts
• Low performance and smaller engines
• 5-star safety
• History of crashing less often
• Rarely stolen.

Is a green slip cheaper for a new or used car?

The price of a greenslip is not based on whether your car is used or new. However, vehicle age is one factor out of many.

We used the greenslips.com.au Calculator to see whether year of manufacture affects greenslip prices for a 45 or 26 year old who drives a Toyota Rav4 or Ford Ranger.

In this case, results are mixed and also depend on driver age:

• The 45 year old pays the same for the 2013 and 2021 model of either vehicle. Year of manufacture doesn’t make a difference in this case.
• The 26 year old pays a third more for the older than the newer model of Rav4. He pays the same high price for the Ranger, whether 2013 or 2021.

Get a green slip for your new or used car

Use the greenslips.com.au Calculator to get the cheapest green slip prices for your new or used car.

The greenslips.com.au Calculator always asks for year of manufacture. It’s important to state this correctly, otherwise your make and model may not show up. Remember, greenslip prices are based on type of vehicle and vehicle variant, as well as the age of the vehicle. They also depend on the age of the driver and their driving history.

See an earlier version of this blog

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