KICK THE TYRES
Be wary — and follow these top tips to take the risks out of buying secondhand
We should be very grateful to those people for whom only that new car feeling will do. They always buy a new car, usually every three to five years, and it costs them a fortune every time they upgrade their wheels. They keep the entire automotive industry in business and provide cheap used cars for the rest of us.
If money in your pocket is more important than driving this year’s model, the argument for buying used is compelling. It’s called depreciation.
Depreciation is most savage during the first three years of a new car’s life. Typically, on a three-year-old car with up to 60,000km on the clock, you’ll pay 60-70 per cent of its new price. The first owner will have got a lot less than that as a trade in. A five-year-old model, with up to 100,000km, will cost 40-50 per cent of the original new price.
The downside of buying used, of course, is risk. New car buyers get a manufacturer’s warranty plus, in recent years, decent legal protection under the Australian Consumer Law. Used car buyers who purchase from a dealer aren’t entirely on their own but it’s most certainly a case of “buyer beware” when you put your money down on a car that’s had a few birthdays — you usually have no comeback if you buy a lemon at an auction or privately.
With that in mind, here’s a guide to minimising that risk and picking up a tidy, safe, reliable used car at the right price.
CASH IS KING
If you want to get the best possible deal from a car yard, don’t show up with a trade-in. Swapping used for slightly less used is double happiness for the dealer. There are good margins in used cars, so if you show up with cash you can usually negotiate a big discount. Sell your old car privately. Even if you sell it cheap, you’ll still be better off than trading it.
If you don’t have the cash, get a loan from your bank. Dealer finance on used cars is expensive and the interest rates are high.
CONDITION, CONDITION, CONDITION
Few kilometres on the clock are usually a good sign but are not the be-all and end-all, especially on older cars — rubber seals and hoses, for example, will wear out regardless of how many kilometres have been covered.
Smell a rat if the kilometres seem very low for a car’s age and you have no way to verify them. The best proof is a complete service record, with receipts. You need to be careful here, too.
Most workshops will date, sign, record the kilometres and put their stamp in the service book each time they service the car. If the book has just been filled in with a pen, and the seller has no other paperwork, the record could be fake.
Call the workshop that’s supposedly been servicing the car and ask them to verify the book entries. Most will keep a record of customer cars.
Then there’s the obvious stuff. If the car is immaculate, garaged, drives well and has all the paperwork, it’s short odds to be OK.
A mechanic we know reckons you just have to look at how the cabin has been maintained. If people are happy to drive around in a rubbish tip, what are the chances they care about what’s under the bonnet?
DRIVE YOUR DOLLARS FURTHER
When you take a test drive, go further than just around the block. Try to find an arterial road or highway, where you can drive for a few minutes at 80-100km/h.
Don’t try to over-analyse what’s going on. Just listen for any odd noises from the engine, transmission or brakes and be aware of any instability in the car, such as pulling to one side, juddering under brakes or the steering shaking.
The car should drive smoothly, quietly and predictably. If it fails on one or more counts, even if you don’t know why, it’s probably best to walk.
Give the airconditioning a thorough workout and ask the owner to show you how to pair your phone via Bluetooth. Problems in either area can be expensive to fix.
BAG IT
Nearly two million cars were sold in Australia between 1999 and 2017 with defective Takata airbags. These can kill you if they deploy. Owners have been contacted with recall notices and asked to take their cars to dealers to have the airbag replaced, free of charge, but some have been too slack to do so.
Go to www.ismyairbagsafe.com.au, and enter the rego number of the car you’re looking at to see whether it’s been recalled. If it has, the owner should have documentation from the dealer that replaced the airbag. No paperwork, no deal.
YOUR RIGHTS
Assume that if you buy privately or at auction, you have none unless you’re on friendly terms with a very good lawyer. If the car drops its guts on the way home, tough luck.
If you buy from a dealer, you’ll pay more but you get a statutory warranty, usually three months or 5000km. However that usually applies only on cars less that 10 years old, with fewer than 160,000km on the clock.
The Australian Consumer Law applies only to used cars bought from a licensed dealer.
That said, the advent of longer manufacturer warranties, such as Kia’s seven years/unlimited kilometres, means that many used cars now have up to several years of full factory warranty coverage remaining. This is transferable to you, provided the car has been properly serviced by an approved mechanic.
Franchise dealers often carry “approved” used cars, in better than average condition with factory branded and backed warranties that effectively extend the new car warranty coverage.
Steer clear of the third-party branded extended warranties sold by independent used car dealers.