Buying guide
What to look for when buying a car
Ready for new wheels? Discover the essential factors to consider before buying your next car.
Buying a car is a major decision. You need to consider many factors before signing on the dotted line. Budget sits at the top of that list. Our guide breaks down the essential steps to protect your wallet and your peace of mind. Read on to master the car-buying process.
- Set your budget: Determine your total buying power and explore financing options first.
- Prioritise total cost of ownership: Look beyond the purchase price to understand long-term expenses.
- Calculate ongoing expenses: Factor in regular costs, including specific EV and diesel considerations.
- Check reliability and safety: Research vehicle history and safety ratings to protect yourself.
- Ensure fitness for purpose: Choose a vehicle that matches your lifestyle and daily needs.
When to buy a new car
Sometimes you have no choice. Your car stops working, and repairs cost more than the vehicle is worth. If your ride spends more time with the mechanic than on the road, it is a money pit, not a car.
If you can wait, timing your purchase pays off. Dealerships discount old inventory when new models arrive. Keep an eye on new release announcements to secure a deal.
For used cars, look for the sweet spot. Vehicles between two and five years old offer modern technology and plenty of life, but at a much lower price. If you want a cheaper option, it still pays to wait for the right offer. On average, more than 1,000 vehicles sell on Trade Me Motors daily.
What to consider when buying a car
To set a realistic budget, account for the total cost of ownership. Avoid spending more than 15–20% of your gross monthly income on car payments. Keep total monthly vehicle costs, including insurance and fuel, under 10% of your gross income.
Prioritising reliability and safety ensures your vehicle protects you and avoids costly repairs. If you are not a car expert and have your eye on something you really like, do some quick internet research before buying.
Research model-specific reviews to ensure the brand has a solid track record for reliability. Always verify a vehicle's background using the registration plate to avoid buying a lemon.
Assess your daily use, typical commute, and whether you drive in the city or on open roads. Factor in passenger numbers, child seat compatibility, and boot space for your lifestyle needs.
What to know when buying a car
Look beyond the sticker price. Factor in 'on-road costs' like registration, a Warrant of Fitness, pre-purchase inspections, and a full tank of fuel.
Calculate your estimated monthly car insurance, fuel consumption, and routine maintenance. If you are buying a vehicle in New Zealand, keep Road User Charges in mind. Both diesel vehicles and light electric vehicles, including plug-in hybrids, attract these charges.
If you need a car loan, secure pre-approval beforehand to know your exact price ceiling. Always arrange financing and compare insurance quotes before you drive off the lot.
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