Used vs. New for best value: Very confused

[confusedaboutcars]

Conventional wisdom, along with various articles I've found on the internet, point out that car value takes a big depreciation hit during the first two years. They say that the actual percentage per year varies by make/model/# of miles/condition, but should range from 10%-20% per year for those first two years. (Correct me if I'm wrong, this is just my interpretation of the research I've done so far.)

However, after having done some general research on used vs. new car buying, I started looking at KBB and Truecar values for certain models as well as specific ads for used cars in my area. In particular, I'm interested in basic model Honda Civics and Toyota Corollas with less than 30k miles and made in 2008 or later. The KBB lists an excellently maintained 2008 Civic with 20,000 miles on it as worth over 15k. This amount is 83% of the cost of buying an equivalent new Civic today, meaning it only went down 17% in four years, where it should have gone down at least 30%. I feel that I am finding similar numbers for similar makes and models. Is the conventional wisdom wrong, or is the KBB value wrong?

Perhaps buying a late-model used really doesn't save money relative to the lowered lifespan of the car compared to new? Should I just try to get a good deal on a new Honda Fit? These cars seem to hold their value well. Financing thru the dealer isn't an issue--if you can help me figure out where to go from here, I would really appreciate it! Thank you.

[speediva]

Hi there! Welcome to AF!

Honda and Toyota tend not to depreciate as much as other makes and models because they still are in high demand even after 4+ years. That's a good thing, because if/when you go to sell one, you don't lose as much money... but then it costs a little extra to buy used than some others. IMO, I think they're worth the extra few bucks. I bought a 1997 Civic a little over a year ago and other than getting rearended by some little old lady (which, btw, my car sustained very little damage - the Ford Escort that was sandwiched was totalled) and it's been a GREAT little fuel sipper!

Keep us posted on what you finally decide!

[Ray paulsen]

I really like your post and will add my thoughts hopefully not to confuse you more

I've found on the internet, point out that car value takes a big depreciation hit during the first two years.... The first year factor can be 25% up to 30% depreciation from total cost going out the door. Entering the second year up to 6 model years old with average miles and in good condition depreciate at a rate of approximately $2500. annually,,, luxury vehicles will have a much higher depreciation factor,,, My facts are based on Dealer Auction sheets.

KBB lists an excellently maintained 2008 Civic with 20,000 miles on it as worth over 15k. This amount is 83% of the cost of buying an equivalent new Civic today,,, I would like to agree, but sorry there is more than meets the eye here,,, A well maintained used car that's less than 4 years old will give you the same satisfaction as a new car for about half the price.that spells around 50%.or less.

Sites like kbb and others also provide consumers with dealer cost on new cars,,, so how does a dealer stay in business,,, if you got the time check out this link on my website http://www.usedcartips.org/invoicecost.html