Cost of buying new each year

EternalSunshine

Somebody might know this one.

Lets say you wanted to drive a new 07 sports car every year. Ideally the car you purcashe would be the newest model of several manufacutures. So you would have gotten say the new bmw 3 series coupe last year, the new audi TT this year and you were looking at a passat r32 for next year.


So you buy your first car outright. Say a lump sum cash payment of 50K.

Ok so lets now forget about this 50k,

So.......for the next say 5 years you buy the latest model every year on Dec/January and sell in Dec/Jan.

What would be the additonal payments each year to buy a new car. That would be the depreciation and the no-cash discount for always trading in.. since there are no other extra costs......you still pay the same insurance (your decreasing premiums will match the extra for driving new) and registrations costs are minimal. Is the correct?

So for normal yearly mileage would a figure of say minimum 7-10k be right?

Esel

Maybe you should investigate leasing?

Henry Ford III

25% p.a. depreciation.

seamus

Well, a quick scan on carzone.ie - comparing the list price of a 3 series 320d, with one from 2006 for sale, would show at least a 10% loss in price. Trading in will lose you another bit of cash, so I'd say you're looking at a depreciation of between 15 and 25% p.a.

That means that if you take out a loan for the full amount, and top up that loan to cover the cost of the new car, then you're looking at needing somewhere between €7,500 and €12,500 every year. That means you need to pay between €600 and €1,000 every month in loan repayments, just to maintain that €50k loan by the end of the five years - before interest!

MarkN

It really depends on what car you are trading in and buying.

I've traded in cars every year for the last seven years and my cost of changes have been from €3,000 to €23,000 to go up one year.

EternalSunshine

seamus wrote:

Well, a quick scan on carzone.ie - comparing the list price of a 3 series 320d, with one from 2006 for sale, would show at least a 10% loss in price. Trading in will lose you another bit of cash, so I'd say you're looking at a depreciation of between 15 and 25% p.a.

That means that if you take out a loan for the full amount, and top up that loan to cover the cost of the new car, then you're looking at needing somewhere between €7,500 and €12,500 every year. That means you need to pay between €600 and €1,000 every month in loan repayments, just to maintain that €50k loan by the end of the five years - before interest!

Paying 50K in cash and the additional once off payment each year is also cash.

So the figure is about around 12-14K a year......seems high.

probably would make more financial sense to go for 1 yr old model each year instead....taking less of a hit on depreciation.

MarkN

Guys you really can't pick figures like that unless you are buying the same car every year. Every situation will be different!

jjbrien

The price your getting on carzone is what the garage is charing to sell the car so 10% off the new price is what there trying to get my family works in the motor trade so I would say you would lose between 15% and 20% the garage needs to turn a profit on your used car. My advise is either lease or instead of selling your car back to the garage sell it privalty as the gargage will try to force your price down.

seamus

MarkN wrote:

Guys you really can't pick figures like that unless you are buying the same car every year. Every situation will be different!

Indeed, I was picking some very rough figures to give an indication, not to get a decent guide price