used cars less than 2 years old?
Thread Starter
Driver School Candidate
Joined: Dec 2012
Posts: 20
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From: NC
used cars less than 2 years old?
What do you guys think is the main reason people sell cars within the first year or two of ownership?
I am considering getting a gently used car, but am wondering why there are so many used cars for sale less than 2 years old with low mileage. I can understand used cars that are 3 years old with 30k miles because of leasing, but when I see a 2011 or 2012 car with less than 10k miles for sale, it makes me skeptical. I would think someone sold it because there was something really wrong with it. Am I being paranoid?
I'd rather not spend more than 40k, so I'd rather get something like a low mileage GS350 than a 2013 IS250. Thanks in advance.
I am considering getting a gently used car, but am wondering why there are so many used cars for sale less than 2 years old with low mileage. I can understand used cars that are 3 years old with 30k miles because of leasing, but when I see a 2011 or 2012 car with less than 10k miles for sale, it makes me skeptical. I would think someone sold it because there was something really wrong with it. Am I being paranoid?
I'd rather not spend more than 40k, so I'd rather get something like a low mileage GS350 than a 2013 IS250. Thanks in advance.
Lexus Test Driver
Joined: Apr 2011
Posts: 8,395
Likes: 361
From: Las Vegas
That's been my thought too, but remember what a consumerist society we live in :P
When we have people camping out for days for a phone that adds very few features over the one they already have, when people have to always have the newest anything......
I have a neighbor who used to trade his truck in for a new one every year for the tax benefit too.
When we have people camping out for days for a phone that adds very few features over the one they already have, when people have to always have the newest anything......
I have a neighbor who used to trade his truck in for a new one every year for the tax benefit too.
CL Community Team
Joined: Aug 2006
Posts: 12,551
Likes: 230
From: San Francisco, CA
You're not being paranoid. Or maybe we are both being paranoid together. I too think the worst when it comes to gently used, used cars. It must to so horrible that a person would be willing to lose so much on depreciation than to keep the car.
like my parents, they like to always have the newest model out. even if its' small changes, they trade it in and always have a problem free car. for the working person that doesn't care much about vehicles, this seems to be the trend.
Out of Warranty
Joined: Aug 2001
Posts: 14,925
Likes: 13
From: Houston, Republic of Texas
With some cars you can get away with turning them over every two years, but not all. I have a neighbor who goes through Escalades on a regular schedule, taking a real bath every two years. He has relatives that do the same thing with their Suburbans - taking a REAL it at the 24 month mark. The real losers in the "Retained Value Olympics" other than commercial trucks, are rather surprising, according to Cars.com. Several Mercedes' S and CL class vehicles, the Porsche Cayenne, and the BMW 760 lose typically 2/3 of their sales price at the two year mark.
OTOH, more mainstream cars, particularly those rather inexpensive small to mid-size vehicles with names like Toyota, Subaru, and Nissan, will lose typically a third or a bit more of their sticker after two years of ownership. It appears that cars that sell at a price closer to invoice are the better bargain when purchased new - because there is often a dealer premium on more expensive cars, particularly those priced over $50K.
This cuts two ways: If you are looking for a car to drive for two or three years and trade, you're better off with a low to mid-price car. If you wallet can stand the strain, buy an expensive luxury car and drive the wheels off of it. In six or seven years, the differential percentage in selling price begins to level out.
If you are thinking of purchasing a used car, you might be better off purchasing a big name luxury vehicle. Your savings will be considerably greater (percentage-wise), by letting that first owner take the big early depreciation hit. Of course, you need to consider both scheduled repair costs and reliability issues that can make a good deal at purchase turn sour very quickly.
Because "retained value" is the basis for car leases, there are some serious quirks in the system. I'd driven heavily -optioned Suburbans for years, but no longer needing the towing capacity of a K-20 Chevy, and tiring of driving what was essentially a pickup with a couple of extra rows of seats, I looked into leasing. In 2000 I leased an RX 300 for considerably less than I could have another Suburban - because at 36 months the Lexus still retained a surprising amount of its value, while the 'Burb was expected to lose over half of its purchase price.
OTOH, more mainstream cars, particularly those rather inexpensive small to mid-size vehicles with names like Toyota, Subaru, and Nissan, will lose typically a third or a bit more of their sticker after two years of ownership. It appears that cars that sell at a price closer to invoice are the better bargain when purchased new - because there is often a dealer premium on more expensive cars, particularly those priced over $50K.
This cuts two ways: If you are looking for a car to drive for two or three years and trade, you're better off with a low to mid-price car. If you wallet can stand the strain, buy an expensive luxury car and drive the wheels off of it. In six or seven years, the differential percentage in selling price begins to level out.
If you are thinking of purchasing a used car, you might be better off purchasing a big name luxury vehicle. Your savings will be considerably greater (percentage-wise), by letting that first owner take the big early depreciation hit. Of course, you need to consider both scheduled repair costs and reliability issues that can make a good deal at purchase turn sour very quickly.
Because "retained value" is the basis for car leases, there are some serious quirks in the system. I'd driven heavily -optioned Suburbans for years, but no longer needing the towing capacity of a K-20 Chevy, and tiring of driving what was essentially a pickup with a couple of extra rows of seats, I looked into leasing. In 2000 I leased an RX 300 for considerably less than I could have another Suburban - because at 36 months the Lexus still retained a surprising amount of its value, while the 'Burb was expected to lose over half of its purchase price.
there's not always something wrong. people can sell 'early' for many reasons... to name some:
1) can no longer handle the payments or insurance
2) vehicle no longer fits owner's lifestyle
3) decided they've got to have something else instead
4) some combo of above...
1) can no longer handle the payments or insurance
2) vehicle no longer fits owner's lifestyle
3) decided they've got to have something else instead
4) some combo of above...
Lexus Champion
Joined: Aug 2012
Posts: 4,592
Likes: 31
From: TN
Keep in mind that some model Toyotas depreciate at such a SLOW rate, you're better off buying a new one. The 4wd Toyota Tacoma comes to mind. Its like buy a new one for about 25-28k, or buy one 2-3 years old with 30k miles for about 21-24k.
Really though, for what those damn Tacomas go for, you might as well buy a full size Chevy, Ford, or Dodge for the same $$$$$, as even the v8 models get about the same gas mileage now days, and you have a much larger, more capable truck.
Really though, for what those damn Tacomas go for, you might as well buy a full size Chevy, Ford, or Dodge for the same $$$$$, as even the v8 models get about the same gas mileage now days, and you have a much larger, more capable truck.
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CL Community Team
Joined: Feb 2007
Posts: 9,366
Likes: 613
From: IL
Some are dealer demos (that's what our last two ~1 year old "used" cars have been), some are people who just have to have a new car every year or two, and some are the odd-length leases. Aside from the relatively standard 36-month lease, I've seen 24-months advertised relatively heavily, along with some truly strange ones like 28- and 39-month.
I'd have no compunction about going for a very late-model used car, with the exception of those with widespread problems. I wouldn't have done this with an N54-powered BMW, for example, because it may have been lemoned or just traded for fuel pump issues. But aside from that, I think it's a great way to save a bunch of money on an almost-new car. Did it on the last two (a 2007 RX350 right before the 2008s came out, and a 2011 335d a couple of months ago), in both cases getting never-titled cars with around 10k miles for more than $10k off sticker. We'll probably stick with it--thinking about a 7 series to replace the RX in a few years, and $45k is a whole lot more palatable than $100k.
I'd have no compunction about going for a very late-model used car, with the exception of those with widespread problems. I wouldn't have done this with an N54-powered BMW, for example, because it may have been lemoned or just traded for fuel pump issues. But aside from that, I think it's a great way to save a bunch of money on an almost-new car. Did it on the last two (a 2007 RX350 right before the 2008s came out, and a 2011 335d a couple of months ago), in both cases getting never-titled cars with around 10k miles for more than $10k off sticker. We'll probably stick with it--thinking about a 7 series to replace the RX in a few years, and $45k is a whole lot more palatable than $100k.
Thread Starter
Driver School Candidate
Joined: Dec 2012
Posts: 20
Likes: 0
From: NC
Appreciate the examples everyone. This puts me much more at ease about it. I don't even know many people who lease, so the thought of getting a car that often seemed crazy.
Aron9000, good point. With the good deals I see some people get, hard to say whether or not a gently used is worth it. I was also looking at infiniti G through the vehicle purchase program, you can get a brand new for ~6 grand off.
Aron9000, good point. With the good deals I see some people get, hard to say whether or not a gently used is worth it. I was also looking at infiniti G through the vehicle purchase program, you can get a brand new for ~6 grand off.
Intermediate
Joined: Nov 2004
Posts: 471
Likes: 23
From: AZ
As you can see by my signature, I fall into #3
Guest
Posts: n/a
4)moving
5) wants something new
6) just likes changing cars
etc etc
I remember my first GS 400. It had around 10,000 miles in less than 2 years and the biggest thing was some cat hair as it was owned by an older lady who just didn't drive much. Traded it in for a new RX, wanted a SUV.
Lead Lap
Joined: Mar 2012
Posts: 591
Likes: 4
From: Landrum, SC
With some cars you can get away with turning them over every two years, but not all. I have a neighbor who goes through Escalades on a regular schedule, taking a real bath every two years. He has relatives that do the same thing with their Suburbans - taking a REAL it at the 24 month mark. The real losers in the "Retained Value Olympics" other than commercial trucks, are rather surprising, according to Cars.com. Several Mercedes' S and CL class vehicles, the Porsche Cayenne, and the BMW 760 lose typically 2/3 of their sales price at the two year mark.
OTOH, more mainstream cars, particularly those rather inexpensive small to mid-size vehicles with names like Toyota, Subaru, and Nissan, will lose typically a third or a bit more of their sticker after two years of ownership. It appears that cars that sell at a price closer to invoice are the better bargain when purchased new - because there is often a dealer premium on more expensive cars, particularly those priced over $50K.
This cuts two ways: If you are looking for a car to drive for two or three years and trade, you're better off with a low to mid-price car. If you wallet can stand the strain, buy an expensive luxury car and drive the wheels off of it. In six or seven years, the differential percentage in selling price begins to level out.
If you are thinking of purchasing a used car, you might be better off purchasing a big name luxury vehicle. Your savings will be considerably greater (percentage-wise), by letting that first owner take the big early depreciation hit. Of course, you need to consider both scheduled repair costs and reliability issues that can make a good deal at purchase turn sour very quickly.
Because "retained value" is the basis for car leases, there are some serious quirks in the system. I'd driven heavily -optioned Suburbans for years, but no longer needing the towing capacity of a K-20 Chevy, and tiring of driving what was essentially a pickup with a couple of extra rows of seats, I looked into leasing. In 2000 I leased an RX 300 for considerably less than I could have another Suburban - because at 36 months the Lexus still retained a surprising amount of its value, while the 'Burb was expected to lose over half of its purchase price.
OTOH, more mainstream cars, particularly those rather inexpensive small to mid-size vehicles with names like Toyota, Subaru, and Nissan, will lose typically a third or a bit more of their sticker after two years of ownership. It appears that cars that sell at a price closer to invoice are the better bargain when purchased new - because there is often a dealer premium on more expensive cars, particularly those priced over $50K.
This cuts two ways: If you are looking for a car to drive for two or three years and trade, you're better off with a low to mid-price car. If you wallet can stand the strain, buy an expensive luxury car and drive the wheels off of it. In six or seven years, the differential percentage in selling price begins to level out.
If you are thinking of purchasing a used car, you might be better off purchasing a big name luxury vehicle. Your savings will be considerably greater (percentage-wise), by letting that first owner take the big early depreciation hit. Of course, you need to consider both scheduled repair costs and reliability issues that can make a good deal at purchase turn sour very quickly.
Because "retained value" is the basis for car leases, there are some serious quirks in the system. I'd driven heavily -optioned Suburbans for years, but no longer needing the towing capacity of a K-20 Chevy, and tiring of driving what was essentially a pickup with a couple of extra rows of seats, I looked into leasing. In 2000 I leased an RX 300 for considerably less than I could have another Suburban - because at 36 months the Lexus still retained a surprising amount of its value, while the 'Burb was expected to lose over half of its purchase price.
Thanks for the info.
Lexus Fanatic
Joined: Oct 2003
Posts: 94,467
Likes: 252
From: Virginia/D.C. suburbs
With some cars you can get away with turning them over every two years, but not all. I have a neighbor who goes through Escalades on a regular schedule, taking a real bath every two years. He has relatives that do the same thing with their Suburbans - taking a REAL it at the 24 month mark.
This cuts two ways: If you are looking for a car to drive for two or three years and trade, you're better off with a low to mid-price car. If you wallet can stand the strain, buy an expensive luxury car and drive the wheels off of it. In six or seven years, the differential percentage in selling price begins to level out.
This cuts two ways: If you are looking for a car to drive for two or three years and trade, you're better off with a low to mid-price car. If you wallet can stand the strain, buy an expensive luxury car and drive the wheels off of it. In six or seven years, the differential percentage in selling price begins to level out.
I wouldn't do this myself, of course (nor would I recommend it to most car-shoppers)...but I mentioned it to indicate that there are occasional situations where trading or selling every year or two is not always as much of a bath as commonly thought. But, in most situations, first-year depreciation (especially in the first few months) is the steepest, and you WILL take at least somewhat of a bath if you want that new-car smell in your driveway each year.