New cars may be better deal than used

August 6, 2012 3:55:07 PM PDT
Should you buy new or used? It's a common question people ask themselves while looking for a new vehicle. But you might be surprise to learn that buying used may not save you that much, compared to buying a brand new vehicle.

Sticker shock was once reserved for the new car lot, but over on the used car side buyers are seeing prices that are only a few hundred dollars less than new car prices.

Jennifer Burkhalter was in the market for a truck last year and considered buying a one used, until she saw the price.

"I was really shocked," she said.

Shocked because the price of a used truck was only a few thousand dollars less than a new one.

Burkhalter said, "You could go $25,000 on a new truck, versus $20,000 on an used one. It did not make sense, plus we got warranty and the miles were zero mileage on it."

Burkhalter is seeing the same trend Kelley Blue Book has found. The car search tool reports that in some cases, new cars cost nearly the same as those one year old.

Alan Helfman with River Oaks Dodge said, "You will pay a premium on some used cars right now."

Helfman says consumers looking for deals on year old vehicles are often surprised to find the costs are not significantly lower than a new vehicle.

"I sell a lot of them that way because they are shocked," he explained. "It is like they say, 'Man I did not know I could get that quite that way.'"

Take the Jeep Wrangler -- Kelley Blue Book says a 2012 version runs about $22,281, while a 2011 Wrangler is typically prices at $22,000, a difference of less than $300. Another factor is that the supply of new cars is dwindling on some models.

Helfman said, "The cars are better and there are warranties out there that guarantee them for life."

Used car buyers can find deals, but they have to look past vehicles that are only a year or two old. A new Toyota 4 Runner costs more than $35,000. To find a deal on a used 4 Runner you have to settle for one that is four years old. It can be found for about $6,000 less.

We looked at 2011 cars with no miles versus those with mileage and found that in some cases buying a 2012 makes more sense.

Financing deals are another reason new cars are close to the price of used cars. If you qualify, you can get zero percent deals. On used cars, the interest rates can be up to six percent or more.

So which cars are the best deals? Kelley Blue Book has a list of 10 vehicles to buy new rather than used.


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