Should you buy a new car or something used that is a year or two old? We explain what you need to know.

HERE’S AN AREA where everyone has an opinion.

New car buyers will tell you that it’s all about the new car warranty, the fact the car is new so there shouldn’t be reliability issues, and, well, it looks great (and that new car smell). What they don’t like to mention is the fact that as soon as that new car rolls on to the road thousands of dollars in value have been wiped because quite simply, cars – well most of them – depreciate and they depreciate most in the first few years.

This is where your second-hand car buyer puffs out his chest.

The second-hand car costs less than a new one. Buy it at the right time – ideally with decently low kilometres and some of the manufacturer’s warranty still in force – and the second-hand car can be a bargain, saving you thousands of dollars.

Of course, if you buy a new car and then keep it for a long time – let’s say 10 years –you will squeeze the full value out of it. Against that, you have to balance the fact that repair and servicing costs will go up steadily.

Buying new – what to look for:

  • Keen deals on final price
  • Extended warranty
  • Best options package you can afford
  • A car with a known reputation for reliability
  • Colour – bright, garish colours that look great today may seem tacky tomorrow… 
  • Extended servicing intervals – look for 15-20,000km for major services
  • Fixed-price dealer servicing

Buying used – what to look for:

  • Good condition, inside and out – check for bodywork dents and dings, repair work, chipped wheel rims (points to a careless driver), seats and headlining in good condition without marks or rips
  • Check mileage – low mileage a plus, around 15,000km or less a year is average
  • Check for a full-service history
  • Make sure all switchgear works, especially electric windows, door mirrors, central door locking, reversing sensors
  • Check air conditioning for good cold airflow
  • Drive the car – listen for clunks from steering and suspension, make sure the car runs straight, brakes pull up smoothly without grinding or pulling, clutch doesn’t slip (drive up a hill and see if the engine revs rise yet the car doesn’t accelerate – if that happens you’re looking at a new clutch cost around $1000), steering should be tight and not have undue play in it.

Take a small torch and look under the car for any signs of corrosion. If it’s a four-wheel drive off-roader check for scrapes and dents on the underside which could show it has had a hard bush-bashing life.

On front-wheel drive vehicles check the rubber boots covering each front driveshaft, making sure they are not split. Replacing the boots is not a big or very expensive job but if the grease and heavy oil have leaked out that could have led to damage to the driveshaft splines, which are more costly to replace. If there are issues here there will be a clunk when you move off from rest.

Check in the engine bay for corrosion on the sides. Unscrew the oil filler cap, the visible oil should be clean. If there is a white residue it usually means there are problems with the engine and it should be avoided. Get the owner to let the engine tick over with the oil cap off. Oil should be seen flicking up onto this top part of the engine, a sign that the lubrication is acting as it should.

Automatic transmissions should change up and down the gearbox smoothly without clunking. Avoid a car with an auto gearbox that slips, or fails to move smoothly from one gear to the next – auto gearboxes can cost $5000 or even more to replace.

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About Author

Practical Motoring

The team of journalists at Practical Motoring bring decades of automotive and machinery industry experience. From car and motorbike journalists to mechanical expertise, we like to use tools of the trade both behind the computer and in the workshop.


  1. You got a good insights there. Buying a car these days could give you a headache. I really appreciate someone sharing good thoughts such as this one. Researching the vehicles that interest you and arming yourself with this knowledge will bring you half way down the road to your purchase.The test drive is customary to go for before you do any negotiations especially buying a used car.

  2. My last three vehicles purchased have been 2 to 3 year old cars and I have very happy with my decision. Balance of manufactures warranty does give your some peace of mind. I bought a 3 year old Honda CRV 2.2 Diesel with 44000km and it is a good as new. I must caution that you should be very careful before you make your decision to bye.

  3. I would have been happy to buy a demonstrator. One was not available so I bought new. It will likely be the last car I buy so I’ll have it long enough not to worry about resale or depreciation.

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