Resale prices to drop even more

[dogwatch2]

It looks like even worse news (or better?? : ) for second hand car prices according to this article in the Daily Telegraph today..............................
"SMART buyers are cashing in on tumbling used car prices - and the value equation is only going to get better.
Research by fleet company FleetPartners indicates that Australia's booming new car sales are forcing down prices in the used car market.
"In recent years we have seen residual values slump by around 20 per cent as the volume of new car sales has risen and prices for new vehicles have generally remained steady," FleetPartners chief executive Nick Johnson said.
"Our prediction is for a continued softening in residual values, probably in the order of a further 20 per cent between now and 2011."
The FleetPartners' research estimates a new car bought for $30,000 today will be worth $10,750 in 2010, or 36 per cent of its original price.
A $30,000 car bought in 2004 and sold in 2007 would return about $13,000, or 43 per cent.
Over the long term, falling used car prices could also have ramifications for the new car market, with bargain prices likely to lure some potential buyers away from new vehicles"

[pauljh74]

One reason why I don't see myself ever buying new. Get a car a few years old and pay almost half the price. Sure, it's got some kms on it, and you don't get to tick the options list, but for the money you save, it's easy to put up with.

[Hunter]

I don't see why this is a surprise - how many new cars are made every year? We only have 21 million people in this country - the demand for new cars can't sustain forever and eventually there will be more cars than buyers and thus the supply outstrips the demand and prices go down. Used cars will get driven down in price by the oversupply and newer models coming out but car companies can't drop the price of new cars too low whereas people selling used cars will usually drop it much lower than they should to get a sale.

[3vXT]

My XT was bought new for $42,000 (with few options) mid 2003 and i bought it January this year for $19,000.
Thats good news for me, kinda bad for the original owner though

[wodahs]

so now if i was to go buy a 5 year old commy id pay very little and in six months time if i was to buy the same commy they'd be payin me ? : :

[3vXT]

Originally Posted by wodahs

so now if i was to go buy a 5 year old commy id pay very little and in six months time if i was to buy the same commy they'd be payin me ? : :

Thats not as unbelievable as it sounds.
I bought my previous car for $2,800 with 160,000k's and sold it after 3 years for $2,600 with almost 300,000k's. Buying used cars FTW

Something tells me i wont be as lucky with the BA though

[JBomb3000]

Originally Posted by ken2903

Thats not as unbelievable as it sounds.
I bought my previous car for $2,800 with 160,000k's and sold it after 3 years for $2,600 with almost 300,000k's. Buying used cars FTW

Something tells me i wont be as lucky with the BA though

My first car was an EA S pack put 40,000kms on it in 2 years and being my first car it copped a fairly hard time. Sold it for $750 more than i paid for it. Hasn't been the case with every other car that's followed unfortunately. Everyone knows new cars deprecate rapidly but if you want the privilege of having a "new" car with all the options you want in your choice of colour etc, etc then it's something you just accept.

[DOC]

Absolutley not surprised, have been saying this will happen for some time.

[pauljh74]

Originally Posted by Hunter

I don't see why this is a surprise - how many new cars are made every year? We only have 21 million people in this country - the demand for new cars can't sustain forever and eventually there will be more cars than buyers and thus the supply outstrips the demand and prices go down. Used cars will get driven down in price by the oversupply and newer models coming out but car companies can't drop the price of new cars too low whereas people selling used cars will usually drop it much lower than they should to get a sale.

Look at Falcon prices for example. New prices have gone up 20% over 10 years. The 10 years prior to that (87-97) they went up almost 60%. But how much more do you get in the current version? Bigger car, better dynamics, more power, more features. The features list on the XT now is comparable to the Futura of 10 years ago. With the relatively small price increases from model to model over recent times, it's no surprise used prices take a hammering. The rest of it comes down to supply versus demand. Commodores and Falcons sell alot and are used in business fleets primarily. The companies sell them after a few years and the relatively high supply pushes prices down. Other cars that don't sell in as large numbers, and are desirable cars will hold value better. An example could be the Subaru Liberty. Not a bad car, you don't see them in large numbers. A 10 year old LX sold for about $29000 new, less than a Falcon. But now is worth about $3000 more than one.

[DJM83]

Its good for people in the market for a used car, thats why ill never sit my bum in a new car and drive out with it

[AC/DC]

The proof is at any Govt Auction where new condition 2003 Xt's with about 35000k on them sell for $15000, with balance of new car warranty

Thats a 50% price drop in 24 months.

Why would you buy a new car ?

AC/DC

[Yellow_Festiva]

Originally Posted by AC/DC

Why would you buy a new car ?

AC/DC

I think the only reason you would buy a new car is if you plan to hold onto it for a while.

Upgrading your new car every 3 years will just burn a hole in your pocket. People seem to have a phopia that convinces them their car will self destruct just after their factory warranty expires or just before the car is due for a timing belt change.

So you sell a prefectly good car that you have serviced religiously to maintain the factory warranty for half the price of the next car you need to buy just to do it all again. :

[WAXBFAR]

Yeah, .... BUT,............. look at the equation of say a Ford Falcon bought in 1969-1975 era!
They were then,say an XB (coupe) +/- $4000 and look at them now!
$4000 for a bare shell in need of panel and paint, never mind a nice one ready to enjoy! $20K starting point!