To sell or not to sell, that is the question.....

jimbling

Right. So I have now had my 04 E46 BMW M3 for close to two years. I have loved every moment of it. Fantastic car on all fronts.

Alas, I have hated watching it depreciate to a depressingly low price. I bought it about 2/3 months before the BIG drop in the economy. I paid what I thought was a fantastic price of 40k. 5 months later it was probably only worth 30k. Now I could maybe get 23/24k for it.


So, on to my issues. Before I bought this car I was earning a solid wage and making quite a bit of extra income from poker every month.
I still have a decent job but I am coming out with much less each month, due to tax changes, and the fact that I no longer seem to be good at supplementing my income with poker winnings.
So, I am finding myself living beyond my means and the majority of that is the car.


So, the choice I have to make is this.
1) Take the hit on depreciation. Sell it (if I can) and pay back the loan. Then buy a more reasonable car for whatever is left over. Should have about 10-12k, so there's plenty options there.

This option depresses me, but might be the sensible one to take. It would give me probably around €700 extra a month into my pocket. I could also fix up and re-insure my motorbike to still get my speed thrills

2) Trade the car in. I would guess that I would get a decent trade in price in a BMW garage? One of my thoughts is to trade it in for one of the big diesels. The low tax bracket 330d or 335d. Yes, I will have to add to my loan a bit, but the monthly cost would come down on tax and fuel.

I like this idea :eek:

3) Keep it. I still love the car, I still prefer it to most cars on the road. I'm normally impatient and impulsive so I'm not sure how difficult I would find keeping it for say, anther two years. Not a month ago I was close to trading it in for a Cayman S
If keeping it I would probably push the loan back out to 4/5 years. Currently have 2 years left on it. This would cut my repayments in half.

So, what do ye guys think? What would you do in this situation? To keep or not to keep?

mickdw

jimbling wrote: »

Right. So I have now had my 04 E46 BMW M4

Somewhere between an M3 & an M5 is it?

I cant see a BMW dealer giving you a trade in price you would be happy with tbh so most likely stuck with private sale.
If you are considering a 335d you are not really badly stuck for cash so I would just keep the M3.

jimbling

mickdw wrote: »

Somewhere between an M3 & an M5 is it?

haha, nice one. That probably happened cause I have M4 on the brain. Bought an Airsoft one last week

jimbling

mickdw wrote: »

Somewhere between an M3 & an M5 is it?

I cant see a BMW dealer giving you a trade in price you would be happy with tbh so most likely stuck with private sale.
If you are considering a 335d you are not really badly stuck for cash so I would just keep the M3.

Well, I'm not stuck for cash. What I don't like is living outside my means on a monthly basis. Adding to my existing car loan to upgrade to a nice 08 BMW would be okay. I wouldn't add to my current repayments and the running costs would come down by a good bit.

jimbling

mickdw wrote: »

Somewhere between an M3 & an M5 is it?

I cant see a BMW dealer giving you a trade in price you would be happy with tbh so most likely stuck with private sale.
If you are considering a 335d you are not really badly stuck for cash so I would just keep the M3.

Also, you're probably right about trade in vs private sale. I may be wrong in my assumption that a BMW garage would give you a good deal.
Also, private sale gives me the freedom to go to UK to buy replacement car if I do.

mickdw

Ive lost a fair amount myself on a new car bought in 08. The way I see it, its either stick with what you have or buy a much cheaper car.
I would say there would be at least 7k difference between private sale & trading in if looking at a 08 335d- thats if you could find a 08 335d here.

jimbling

mickdw wrote: »

Ive lost a fair amount myself on a new car bought in 08. The way I see it, its either stick with what you have or buy a much cheaper car.
I would say there would be at least 7k difference between private sale & trading in if looking at a 08 335d- thats if you could find a 08 335d here.

em, you're not serious are you? 7k difference? :eek:

Jesus, well that just puts that out of the equation by a long way. I always thought you get pretty decent value for a trade in when buying the same make of car again.

mickdw

Some of the trade guys here may disagree but I saved 5k in 08 selling a TT private & buying straight. It is always worth selling cheaply privately as in all cases this will be more than dealer is really offering when you consider his straight sale price.
I would think they will be offering nowhere near the figures you quoted as your cars current value.

subway

if you can get 23k for it, you could stick 7k in your pocket and get a 2002 M3.
or 15k in your pocket get an e36 m3
or 10k in your pocket and get an e39 m5...

if your car is still worth that, i dont know it but 23k seems achievable for the year, and you could easily keep the peformance.

you dont give any real reason for change?
you are toying with improved performance (cayman s), cheaper overall costs (downgrade) or buying some more depreciation (08 335)

if you figure out what you want and then it will be easier to help you out with the decision?

jimbling

subway wrote: »

if you can get 23k for it, you could stick 7k in your pocket and get a 2002 M3.
or 15k in your pocket get an e36 m3
or 10k in your pocket and get an e39 m5...

if your car is still worth that, i dont know it but 23k seems achievable for the year, and you could easily keep the peformance.

I think I'm okay with losing some performance. I would still like to have a quick car, but I can definitely downgrade

subway wrote: »

you dont give any real reason for change?

Thought I gave numerous reasons, the main one is reduction in running costs.

subway wrote: »

you are toying with improved performance (cayman s), cheaper overall costs (downgrade) or buying some more depreciation (08 335)

The Cayman S was a flitting fancy I had. Only mentioned it in the OP to portray how impulsive I can be. Sorry thought that was clear.

mickdw has convinced me trading in for 08 diesel is not a good option so think that's put to bed now.

subway wrote: »

if you figure out what you want and then it will be easier to help you out with the decision?

If I sell the car privately I have huge options on what to purchase next. I'll start thinking about that when I make a decision.

It was more looking for advice on whether to sell or not to sell. Again, sorry, thought that was clear in OP.
Maybe I should have posted this in a financial forum.


I've been thinking about it today and I think I'll keep it for another year. I'll ring the bank tomorrow and see about stretching the loan out so that I have less to pay each month.

CiniO

I would personally never take a loan to buy a car.
It's stupid to but something that you don't have money for, unless this thing brings you more money.
On a car you always loose.

So I'd never take a loan for a car, and I'd never had a problem like you (to get rid of it or not).

In your case, I would chose option 1 - sell the car, repay the load, and buy something you actually have money for.

PrettyBoy

Sell the M3, it's just going to keep depreciating. Heavily. Get your loan cleared and your finances back in order so you're comfortable and no longer living beyond your means. Drive something more practical for a while and if you want you can go back to the M3, or if you really want you could sell your '04 and buy an '01-'02 for €10K tomorrow.

unkel

jimbling wrote: »

Well, I'm not stuck for cash. What I don't like is living outside my means on a monthly basis. Adding to my existing car loan to upgrade to a nice 08 BMW would be okay.

Keep your car. Going forward, it will depreciate less than an '08 335d and as others suggested, you'd be raped over the trade in price. Try and make savings elsewhere and try and pay off your car loan as quickly as you can.

In the meantime, enjoy the M3

subway

i was trying to give a financial slant to my advice, will try again

jimbling wrote: »

Thought I gave numerous reasons, the main one is reduction in running costs.

Well, I'm not stuck for cash ... Adding to my existing car loan to upgrade to a nice 08 BMW would be okay

im not having a go, but thats what confused me. you wante to reduce running costs, but then the options you were giving were all about increasing them

when i think of a car i think of 3 costs, depreciation (the biggest), financing costs (the most regular) and day-to-day running costs fuel/insurance/tax/services (the most obvious)

i always try to avoid depreciation, and you have gotten stung bad with it this time, my advice would be to avoid it again here. dont add to your loan if the main theing you are buying is depreciatiaion

as above, dont refi just for depreciation. if you want to cut outgoings, pay your loan off early. in the long run its the best way to cut outgoings. if you must reduce outgoings asap, spread the loan out but dont add to it (i dont think you need to do this)

day to day running expenses, the m3 is a dear car to run, but take out further depreciation and either reduce or pay off the loan and its not so expensive anymore.

best financial decision :
sell the M3, clear the loan, budget what you comfortably want to spend on a car over the next 5 years and buy one based on knowing eveything up front.

mid financial decision :
sell the M3, clear some or all of the loan, buy something similar (lower year M3, M5) save on deperciation and loan costs and put the money into enjoying the car

worst financial decision
trade in M3, extend loan, buy depreciation heavy car.

just my 2c...

i drive an 02 M5, bought for cash and has possibly gone up in value.

jimbling

PrettyBoy wrote: »

Sell the M3, it's just going to keep depreciating. Heavily. Get your loan cleared and your finances back in order so you're comfortable and no longer living beyond your means. Drive something more practical for a while and if you want you can go back to the M3, or if you really want you could sell your '04 and buy an '01-'02 for €10K tomorrow.

Well, to be honest, I disagree with that. It will certainly keep depreciating, but not heavily.... and nowhere near as much as it has the last two years.

jimbling

unkel wrote: »

Keep your car. Going forward, it will depreciate less than an '08 335d and as others suggested, you'd be raped over the trade in price. Try and make savings elsewhere and try and pay off your car loan as quickly as you can.

In the meantime, enjoy the M3

Cheers unkel.... I think this is what I will do to be honest.

I'm not sure I can speed up getting the loan cleared to be honest. I cant afford to pay more off it. So spreading it out is a more likely option.

PrettyBoy

jimbling wrote: »

Well, to be honest, I disagree with that. It will certainly keep depreciating, but not heavily.... and nowhere near as much as it has the last two years.

I agree the worst is over but it will be worth around €16K in 18 months. I know a guy that had his '02 up for €13K and took €10K in the end. As much as I love them, these cars can't hold their value.