Talk me out of a terrible car buying decision!

In My Humble Opinion
1

Ok, so I secretly (and probably obviously) actually want to be told this is a good idea, but I know it probably isn’t and just need to have a little good sense knocked into me by people not emotionally involved.

Sort of long, sorry.

I need a new car. My current car is paid off but has 168k miles on it and is starting to get… Weird. It runs and probably will for a while, but there is also the real possibility that things could go catastrophically wrong any day now. It’s a 2016 Hyundai Elantra. I drive about 30k miles a year because of my job.

So, I would like to buy a new 2022 Toyota GR86/Subaru BRZ (essentially the same car). The problem is, due to covid, no one has any in stock at the moment and Subaru is saying they won’t even take orders until the 23 model year. Toyota is saying you can put down a deposit and when they get a car three to six months from now they will call you. The general internet is saying this is probably a lie, but what the heck I put down a 500 dollar deposit and got a written promise that I could buy the car at mspr (roughly 31k) when it came it.

So, now I wait and hope. Here is where the bad idea comes in.

My 2016 Elantra is worth nothing. I think I can sell it to Carvana for 2500 the dealership didn’t even want it in trade. It’s also clearly on its last legs. Carmax has a 2018 version on the car BRZ that is on hold for me to test drive until Saturday. It looks like it’s in good shape it’s 28k and has 25k miles on it.

How bad an idea is it to just buy the used car with the money I had saved to buy the 2022 version, with the intention of when the 2022 I just placed on hold comes in offering it in trade or selling to Carvana or back to Carmax?

I will probably lose some money on the deal and all used cars are over priced right now. But even used a BRZ/86 is a hard car to find right now. I’m pretty shocked that there is one in good condition used for sale near me. Also, my current car does need new brakes and tires in about 8k miles.

This feels both extremely stupid and like a really good way to go at the same time. So which is it?

2

It’s not a terrible idea. It’s a little risky, but I think over the next 6 months things are going to stay basically the same as they are today.

Buy the used car, dump your current car, and wait impatiently for the new car. If it comes in early, no problem since used cars are selling at a premium and you can trade it in or sell it. If it comes in later you still have a reliable car to drive until it gets here.

I don’t really see a big downside to your strategy, assuming the used car you are thinking of buying is in good shape and won’t need any major repairs in the next 6 months.

3

How much is it worth to you to have a reliable car for the next 6-12 months? You’re probably going to lose a little on the transaction, but unless things change in the used car market, it’s a few thousand, not half your money. Also consider the money you’ll have to spend to keep your current car running if you go that route.

4

How about starting by getting a good mechanic (dealer or independent) to evaluate your current car and let you know if they see any issues? You may just be perceiving problems when there are none. If that’s the case, stay on the waiting list for the new car if you want.

5

I was kind of wondering about something being shot after less than 170-thousand miles myself. Today’s autos last longer than that.

6

So, it’s 4 years old, has 25k miles and costs $28k, while a brand new one costs $31k? Financially, you’re at risk if your new car is delayed, as you’re potentially jacking up the mileage to 40k in just half a year. Now it isn’t a 4.5 year old car with super low mileage, it’s just a 4.5 year old car.

It’s potentially a few thousand dollars for 6 months of peace of mind. I also would suggest getting your mechanic to give your current car a hard look, and suggest if it really is on its last legs, or if you’re perceiving something that isn’t really there.

7

Having my mechanic give me some peace of mind sounds like a good idea.

I worry because it’s starting to idle a bit rough and there is some weird electrical oddball stuff going on and I KNOW it needs new brakes and tires soon. But breaks and tires will only be a couple grand.

8

If the plan is to buy a used car and wait for your new one to be available, I don’t think buying a 4-year-old car at only a tiny discount to new is a great plan. You’re obviously paying quite a lot to get that particular model.

Obviously, that’s the car you want, but spending 6-12 months with a less-than-ideal model could be worth several thousand.

How bad would it be to just buy the 2018 and keep it?

Looks like a really cool car though. So, factor that in. If you can afford to blow a few $thousand, there are worse ways to spend it.

9

Exactly. The cheapest thing is just to keep driving the current car, especially now in this time of inflated car prices. I was thinking about a new car to replace my current 12-year-old one but really have no reason for it, so instead I’ll wait for the shortages to subside. And the upside is that every year, new cars will have some feature not previously available. (Adaptive headlights may be the next new thing.)

10

A 4 yo car w/ 25m miles for 90% of the cost of a new one for what is to essentially be a short term lease?..& you put high miles on your cars, which will further reduce the value when you go to sell it?

Another vote for have the mechanic check over your existing ride; barring anything major repair as necessary & keep it.

11

A 2016 car w/ 168K miles is practically new in my book. (Most of my cars are 2000 to 2010.) My vote is to keep it running.

12

This is always a very good thing. I remember Click and Clack pontificating about this. Buying a new car only makes financial sense if the monthly maintenance / operational costs on the old car exceed the same costs with the additional financing payment that would be required for the new car. It sounds like you aren’t there yet.

Another vote for this. If you get the new-to-you-but-still-used car you’re prepared to spend

on something with an unknown history. Low miles and only 4 years old sounds great on the surface but my immediate suspicion is that there would be something wrong with the car that is not immediately obvious – an intermittent electrical issue, for instance, that proved to be so annoying or debilitating that the previous owner sold the car in disgust (been there, as the buyer thinking they’re getting a good deal it truly sucks). I drive a similar amount as you each year (~27K miles) just for my work commute and not having that peace of mind that comes with knowing a car’s history would be cause me no small amount of anxiety.

You can replace a vast majority of the components on even a late-model car for $28K, with a new paint job and a professional deep cleaning as well. Plus, you know your current car’s history and know what’s been done to it and what hasn’t. Personally, there would be that peace of mind I need.

Of course, if you want a new car because you like the new car and dislike the old one then the financial minutiae become less important. Going from a Hyundai Elantra to a Subaru BRZ is like going from a Honda Civic to a Toyota Supra. As a Civic owner who’s driven a Supra I can see the appeal. Obviously that’s a decision only you can make.

13

Buying any car right now is a bad financial decision. Others have pointed out that the 2018 is 4 years old and has only depreciated 10%, but this is normal in 2022. That honestly isn’t a bad deal for 2022 because used car prices are insane right now. Sure, Carmax prices skew high. Sure, Carvana is lowballing you at 2500 (it’s a running car in 2022, it’s worth more than you think). But there’s a reason places like Carvana and Carmax are popular, and it’s not because they’re a good bargain.

So the smart money is to wait 2 years for things to die down. Put another 60k on the Hyundai. Keeping it running will cost way less than the current markup on anything with 4 wheels and a horn.

On the other hand, life is short. Buy the damn BRZ and have fun.

14

This is a good point as well. If you decide to get rid of the old car get a cursory inspection done by a mechanic, repair anything significant if needed, and the sell it private party. You will get significantly more money for it that doing a trade-in. That’s always been the case but I think is much more applicable now.

15

I wouldn’t be surprised if you could trade it in for more than that even. Carvana is being particularly stingy because the mileage is too high for them to resell so they’re going to wholesale it. But a local dealership would be more than happy to flip it.

16

This is the worst idea ever. First of all, I don’t know how a 2016 car is only valued at $2,500. That’s crazy. Edmund’s has the trade-in value at $6000 with that many miles, which seems correct to me. If you bought the car new, and got $6k for selling it, that would mean you spent about $2k per year for the car, which is pretty reasonable. Obviously, that doesn’t include upkeep.

Second, I don’t think people realize how costly it is purchasing or selling a car. Each transaction costs lots of money. For example, the 2018 BRZ retails around $28,000, according to Edmunds, depending on the trim level. The trade-in value is $4000 to $4500 less, with the same miles. With 15k miles in 6 months, that deducts almost another $1000 from the trade-in price. So, you’d be paying $5000 to drive a car for 6 months! Plus, if your state has sales tax, it will cost even more. In my state, I’d be shelling out another $1500 for a $28k car. Then, there are title and registration, which would be a negligible cost in your case of $100 to $150.

Lastly, brakes and tires shouldn’t be as expensive as you think. I would say about $1000 max, unless your calipers are toast, too. But that would only drive the price up a couple hundred more.

So, in my opinion, keep the beater while you wait for the new car.

17

One way to look at it: the 28k price on the used model is almost certainly a direct result of the scarcity of new inventory. At the point at which you can buy a new one, that’s one piece of data suggesting that new inventory is easier to come by. It stands to reason that would deflate the value of used cars at that point.

So, you’d be buying the used model high and selling low-ish, and presumably buying the new model with no bargaining power. Given that people tend to be pretty optimistic even in their “worst case scenario” projections, maybe a good idea would be to think, how much do you think you risk losing on the short-term deal, and how would you feel about losing double that?

Or, another way of looking at it, if you assume a bad outcome from flipping the used model, say you lose 7k on it. If you spent that 7k up front and just bought a new car for 40k, might you have a car in 1/1.5 years that you like more than the BRZ/86 twin?

18

If I were to talk you out of a bad car buying decision it would have been before you bought a Hyundai, but since you have had it for a while my next advice is to just get it fully, and I mean fully serviced.

The used car market used to be the place to get a great deal but now the prices are insane for a marginally used car, just keep yours. Get new brakes, wheel alignment, check the wheel bearings, look at the exhaust, shocks maybe, cooling system, of course you have changed the oil and do other regular maintenance I hope.

By your OP it seems like you are of the mind that cars just wear out after a certain number of miles, they don’t (well maybe a Hyundai). You can get it checked out, fully serviced and drive it, 170k miles is nothing for a properly maintained newish car.

And then just drive it while you wait for your new Toyota. Not a Subaru because, damn, you already made one mistake.

19

If your existing car is that wonky, then what you describe isn’t crazy at all.

If you think your existing car might last the 6 months (or whatever), and your work route keeps you in places where you could get help if it breaks down, that’s an argument for (perhaps) keeping it a while yet.

Let’s say you get that used car for now. In 6 months, either the market will still be insane, in which case you can likely sell it for not that much less than you bought it for, when you get the new car - or the market has dropped to a more normal level. In that case, the used car might not sell for that much, but you might have more negotiating room in buying a new one.

If you do put a contract in for a new car, make sure there aren’t any incentives in place that might muck up the deal later. I saw a news report where the buyer had to pony up several thousand dollars more than the agreed-upon price.

Also, let’s say you decide you’re happy with the used car - or you want a new one, but think you can do better elsewhere when the time comes, is that 500 dollars refundable?

And let’s say you keep the old car (skipping the interim car entirely): what are the chances that it might want repairs that are expensive enough to exceed any potential loss on the interim car?

I’m continually thankful that our 22 year old Civic died when it did (late 2020). We bought our CRV right then - not that long before the marketplace went insane. The Civic had started wanting very $$$ repairs (a new alternator early in the year, and about 2400 bucks worth of exhaust system work).

One financial advice columnist says, over and over, “Buy used, pay cash, and keep it until you’ve got the mechanic on speed dial”. With used cars being so expensive, a new one mightn’t be that much more, so one might ignore “buy used” just now. With the repairs we were paying on that Civic, the car payment (plus insurance bump) is still less than the average monthly repair, so it was absolutely the right decision for us.

Another thought: the OP uses his car a LOT for work. Might a lease be a reasonable option? I know leases in general are not great, and 30K miles a year exceeds most mileage allowances, but it might be something to consider, especially with mileage deductions etc. I’ve never done the math on this sort of scenario (we tend to “buy new, finance, pay off faster than expected, then keep it forever”).

20

Not that there haven’t been other good replies in the “knock some good sense into me vein” (there have been many) but this is the one that struck a chord so I’m gifting you the win for the thread.

Thanks!