How much of a discount on a "Katrina" car?

I’d like to buy a vehicle that is listed as having been registered in a area that sustained serious storm damage. A so-called “Katrina Car”.

I’ve done some searching and found that a “substantial” discount should be expected when buying such a vehicle, but nowhere can I find any specifics.

What percentage discount should I expect to receive? Is it similar to the discount I would expect with a salvage title? Less than that?

Let’s say the used car dealer is asking $8995, and the blue book dealer starting price is $7300. What’s a typical discount?

Anyone have experience either buying or selling one of these cars?

I wouldn’t touch one of those for two cents on the dollar.

Flood-damaged cars really should be destroyed. Salt water is very destructive to cars - there’s going to be corrosion from within the frame members due to water being inside, electrical wiring will be corroded, airbags will be damaged, mold will probably pervade every square inch of carpet and upholstery, the list just goes on and on.

Let’s assume I get the car inspected and find out that the car was, in fact, garaged during the storm, suffered no flood damage or any other damage. It just got saddled with a note on the carfax that it was registered in a storm damage area.

So none of those problems is an issue…then

How much discount?

Maybe I’m being dense here, but if there aren’t any problems related to the flooding, then why would you expect a discount at all?

You shouldn’t expect a discount. I had 3 cars registered in New Orleans at the time of Katrina, and that will show up on Carfax for all 3 of them. However, one of them was in Georgia with me when the storm hit. The other two were at my house where there wasn’t even water in the streets.

Just because the car was registered in the Katrina-impacted area doesn’t mean anything is wrong with it. It’s just a warning to check things out and make sure it didn’t go underwater.

Considering the nasty stuff that was in the water where it flooded, I don’t think there would be any way to completely hide the fact that it was flooded. Most of the flooded cars were taken straight to the crusher. They weren’t even usable as parts cars.

Errr, unless it was garaged in an area that wasn’t in the flood zone, I don’t know why that would make a difference. I mean, you saw the pictures right? The water was EVERYWHERE.
Like others have said. You don’t want a Katrina Car.

Well…let’s see…there does seem to be a diversity of opinion here.

First we have the notion that there should be no discount at all on Katrina cars, since the bad ones were sent immediately to the crusher.

Then we have the opinion that all Katrina cars aren’t even worth 2 cents on the dollar (which by the way is a 98% discount which is actually an answer to my question).

I would disagree with the notion that I should expect no discount.
This site says, “These damaged cars, sometimes called “Katrina cars,” can occasionally be repaired, returned to “like new” condition, and sold to interested parties. Thousands of these damaged cars, trucks and other vehicles are sold at reasonable discounts at auctions all over the country.”

This site says,
"Serious natural weather events that damage and destroy cars also present an opportunity for people who want to pick up great bargains, especially with repairable and rebuildable vehicles that have been declared total losses by insurance companies. As long as the seller is honest and up-front with what is being sold, and the buyer is completely aware of what he is purchasing, some outstanding deals can be had. "

I know from experience that cars with salvage titles are sold at significant discounts - 20% was not unusal - even when they had been restored to “like new” condition. You can argue that if it is “like new” then there SHOULDN’T be a discount, but the reality is that with the stigma of salvage or storm damage these cars ARE sold at a discount.

May I revise my question? Does anyone have experience buying or selling a car that has a storm damage registration notation? If so, how much of a discount do you believe was due to this notation? If there was no discount, why didn’t the buyer receive one since this appears to be common practice?

Thanks.

Look. I appreciate the advice.
But I’m trying to ask factual questions about how much discount is to be expected on the purchase of such a car.

Do you have a factual answer (a number please) based on experience or citation?

No answer to the revised question, but just to reiterate and clarify my earlier post…just because the car was registered in southern Louisiana/Mississippi doesn’t mean that the car was damaged and there is no notation on the registration.

If the car was flooded, you might get a salvage title with it, which would indicate that it was junked and then brought back to street-legal standards. But I wouldn’t touch it in that case.

I actually bought a car that was flood damaged just to pull a couple of parts off it. I paid $50 for a car that was worth about $7500 before the hurricane. I ended up sending it to the crusher without even getting $50 worth of parts off of it. Everything was rusted or coated with this really nasty goop that was a combination of chemicals and human waste.

There was no title or registration involved. It sat in the driveway on the side of my office for a few months and was essentially just an ugly piece of lawn furniture.

They had this on Marketplace yesterday. It’s about the massive numbers of cars that were shipped to Bolivia after Katrina because they were the only ones that would fall for THAT one, and all the ensuing trouble. They may be pretty on the outside, but their insides are rotten.
-Lil

I live in Katrina land. I wouldn’t buy, heck I wouldn’t take as a gift, any car marked as being in this area during the floods. Unless you have proof that the car didn’t suffer any water damage, don’t even consider it. It might run now, but water in the wiring only gets worse. If you can come up with independent proof that the car didn’t suffer any water damage, then being in Katrina won’t matter. But I don’t think I can come up with sufficient proof short of a detailed stripdown by an experienced mechanic.

I don’t think it’s fair to imply that Bolivians are naively accepting damaged cars. Bolivia would appear to have more liberal laws than neighbouring countries when it comes to importing used cars, that’s all. They are not fools, they know what they’re buying. Maybe they’re getting some bargains that Paraguay or whoever aren’t.

To get a factual answer, we need to get the question clarified, which is what I was attempting to do. You first asked what the expected discount would be on a ‘katrina-car.’ You then altered the question to add the condition of it being ‘garaged.’ I was simply trying to explain that a garage certainly isn’t going to protect it against the flood that Katrina caused. You also mentioned that the car wasn’t damaged during the floor for whatever reason, but it was registered to someone who lived in the area and thus got a Katrina-car tag.
So here’s your answer. It it was in the flood, you shouldn’t even bother with it.
If it was tagged as as katrina car, and you are 100% absolutly posative it wasn’t in the area during the flood and there is nothing wrong with it, then no discount would be expected.

Besides, when your negotiating with car dealers, new or used, I don’t think there’s any factual answers and this question would probably be better suited for IMHO.

I don’t see how anything in your first post clarifies the question.
Just another opinion. Take it to IMHO please.

That is inaccurate. The question remained the same. And it still is, how much discount should be expected on a car with a storm damage area registration notation on the carfax.

I simply added imaginary information in an attempt to politely dissuade people from giving their opinions about whether or not I SHOULD buy such a car, and rather get factual information about the discounts that - from the only cited sources in this thread which I have posted myself - appear to be common practice.

That attempt failed.

Who cares? How does that answer the question?

Great opinion. Gotta cite?
You buy and sell a bunch of these cars?

Just because YOU don’t have a factual answer doesn’t mean there isn’t one.
Please take your opinions to IMHO.

My first post was only intened to make sure you realize that a car in a garage would still be flooded.

Of course it failed. A car that was flooded and a car that is tagged as a Katrina car but NOT flooded will command a VERY different selling price. That little piece of info (wheather or not it was in fact flooded) will make a VERY big difference.

It wasn’t intended to answer a question. I was defending my previous answer when you jumped on me about it.

and

Your right. We have at least one car dealer (or ex car dealer, I don’t remember) on the board that I can think of. I’m sure he’ll have the answers you’re looking for. Until then, you’ve come to the wrong place if you only want answers from people that buy and sell lots of katrina cars.

Ask the question over there (or have it moved) and you’ll get plenty of feedback, but I’m not sure that’s what your looking for.

O.K. you admit that you don’t have a factual answer.

Why do you keep responding in GQ (with opinions) to a question for which you know you don’t have an answer?

Just like to read your own stuff?

There is no “standard” discount that one should apply for a flood damaged car. This is why you can’t find any hard numbers. Most insurance companies will just total a flood car. The airbags are ruined. The car’s electrical system is forever cursed. There will be mold deep inside the ventilation system and in other places that you just can’t get out no matter how hard you try. The upholstery will have a musty smell that won’t go away. The cost of fixing all of this usually exceeds the value of the car. There are also legal issues that result from selling a car with ruined airbags.

If the owner doesn’t have insurance on the car, they will try to get what money they can for it (hence, no “standard” discount). In some states, the car title must indicate that it’s been in a flood. In others, this is not required. What happens with a lot of Katrina cars is that the car ends up getting transferred to another state so that the title can be “cleaned” and doesn’t indicate that it’s a flood or “salvage” car. Anyone who knows what they are doing won’t touch a flood car (which makes me wonder why you persist in this despite the excellent advice of so many people above warning against it, but hey, it’s your choice), so if the title hasn’t been “cleaned” then the seller may find it almost impossible to sell the car. A lot of cars in New Orleans were sold for basically scrap value. A lot of these “scrap” cars ended up being bought by dealers who moved them out of state, cleaned the titles, and sold them for the full retail value of a used car.

It’s very easy to find people selling flood cars at much greater than scrap value. For example, here’s a site selling a 2001 Chrysler Sebring LXI flood car for $8,995 :
http://salvage-vehicles.com/repairable-cars.asp
I went to the Kelly Blue Book web site and put in that vehicle in the same zip code as the seller, and the retail value came back as $10,535. They aren’t giving much of a discount.

So there’s your cited discount value. The car can have anywhere from about a 10 percent discount to being sold as scrap, or anywhere in between.

And, with that factual reply, we come to the end of this saga. Closed.

If anyone feels the need to open another thread, feel free. Just don’t do this same one, slightly reworded, in General Questions.

samclem GQ moderator