Johannesburg - The exchange rate has pushed up the price of new vehicles, opening up the gap between the prices of new and used cars, which, coupled with uncertainty around the interest rates, means buyers are starting to find better value in the used-car market.
This, combined with higher living costs, means that WesBank this year anticipates an increased demand for used cars. Pre-owned vehicles can not only be more affordable, but may also offer better value for money.
Here is some advice from WesBank’s experienced team.
One of the most important things to keep in mind when considering a used car is its history, including:
- The number of previous owners.
- Total mileage.
- Vehicle age.
- A possible accident history.
- The service history of the car, as documented in service manuals.
Any combination of age, mileage, service history and ownership history can affect the price of a used vehicle.
For instance, a one-owner car that is two years old and has done only 20 000km, with a full service history, is worth more than a similar car with no service history.
It is advisable to always do business with a reputable, approved dealer – one that has RMI membership and is bank-approved – as it may be in a better position to help obtain details on the vehicle’s history.
TO GOOD TO BE TRUE?
A car that is advertised at a price well below its market value is another possible warning sign. A car that costs significantly less than similar models could indicate anything from extremely high mileage relative to the year model, previous accident damage or a history of serious mechanical problems.
Buyers should exercise extreme caution when confronted with a vehicle that is listed as Code 3. This is an insurance term used to denote a vehicle that is “permanently unfit for use” or alternatively a car that has been stolen and recovered. Regardless of the reason for the car being classified as a Code 3, WesBank will not finance these vehicles.
ASK FOR HELP
If you do not feel adequately equipped to assess a vehicle, have a knowledgeable person accompany you and help check the vehicle before you make a decision. Likewise, never buy a vehicle you have not had the chance to thoroughly test-drive.
Ask the dealer if the car you’re interested in is still under warranty, still in its maintenance or service plan period, or if the maintenance plan has expired. If not, it is advisable to purchase an extended warranty.
CONSIDER TOTAL COST
Buyers are also advised to consider costs that would affect their total monthly budget. These include costs for insurance and fuel, as well as wear-and-tear maintenance items.
Older vehicles sometimes do not have modern, fuel-efficient engines, so fuel consumption and costs are a major consideration. In conjunction with this and intended monthly mileage, also determine the kilometre service intervals for the car in question. Cars with extended service intervals could be more affordable in the long run, as they need to be serviced less often.
It’s also important to know the replacement costs for common consumables, such as tyres, which can be expensive, adding to the car’s overall maintenance costs.