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Golf R, used or new?

Mk_GTI

Ready to race!
Location
Hellinois
Car(s)
2018 Golf R
That's correct. Because they aren't going to pay the same price. They want to make a profit. Has nothing to do with depreciation. The dealer incurs expenses when they sell a car and they're going to recover those expenses.
Actually, it has a lot to do with depreciation because the market drives what the cars are worth on the wholesale market since dealers sell the vast majority of vehicles under 5 years old. What your vehicle is truly worth is whatever someone is willing to pay for it, but selling your car privately at dealer prices isn't going to move it very fast unless you have a popular vehicle.

This article explains why buying lightly used cars isn't always the best deal: https://jalopnik.com/stop-overpaying-for-lightly-used-cars-1828576980

As with anything, YMMV.
 
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jimlloyd40

Autocross Champion
Location
Phoenix
Car(s)
2018 SE DSG
Actually, it has a lot to do with depreciation because the market drives what the cars are worth on the wholesale market since dealers sell the vast majority of vehicles under 5 years old. What your vehicle is truly worth is whatever someone is willing to pay for it, but selling your car privately at dealer prices isn't going to move it very fast unless you have a popular vehicle.
You said that a used car depreciates as much as a new car when it's sold. So lets say that a new car depreciates 25% when it is sold which is pretty close to accurate. So a 2017 Golf that sold for $25,000 new lost 25% when it was sold making it now worth $18750. A second person buys the car and it instantly loses another 25% making it now worth $14,062. A third person buys it and it loses another 25% making it now worth $10,546. You go find me a 2017 GTI that you can buy for $10,546. That's why what you said is wrong. A used car does not depreciate the same as a new car every time it's sold.
 

Mk_GTI

Ready to race!
Location
Hellinois
Car(s)
2018 Golf R
You said that a used car depreciates as much as a new car when it's sold. So lets say that a new car depreciates 25% when it is sold which is pretty close to accurate. So a 2017 Golf that sold for $25,000 new lost 25% when it was sold making it now worth $18750. A second person buys the car and it instantly loses another 25% making it now worth $14,062. A third person buys it and it loses another 25% making it now worth $10,546. You go find me a 2017 GTI that you can buy for $10,546. That's why what you said is wrong. A used car does not depreciate the same as a new car every time it's sold.
Most used cars do depreciate every time it is titled. Some more than others. Some increase in value after a while, like Mk4 Supras or S2000's for example, but those are pretty rare.

That Golf purchased by the second buyer would lose about around 20% if they sold it a year later. That Golf is now a two+ year old car with 20-24k miles on it if driven on the average. The car has used up a ⅓ of it's tires, brakes and warranty, wear & tear, etc which now eats into that "savings" you got from buying it lightly used. Buying an extended warranty eats up even more money. CPO warranties are generally better, but those cost money as well.

Now, go look at what a new 2019 GTI S sells for with all discounts possible applied and then look at what a used 2018 GTI S is selling for. The new 2019 is probably the better deal.

Now, how the actual depreciation depends on what number you bought the car for and what number you sell it for, no matter if it is brand new or ten years old. If you suck at car buying, then you will lose more money than a pro no matter if you buy new or used. Dealers aren't dumb and know some people don't even look at new cars because this myth is so ingrained. By the time they leave the dealer, they've negated most of the savings with extended warranties and APR's and other add ons.

There is no firm answer on whether buying new vs used is the better deal because there are so many factors. We can run tons of scenarios, but there is no one size fits all answer here.

The only way to not lose money on a car is to never sell it until it's useful life is over, which wholly depends on many factors. Remember, you still got use out of the car for your money. Cars should almost never be considered an investment and nearly always as a liability.
 
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jimlloyd40

Autocross Champion
Location
Phoenix
Car(s)
2018 SE DSG
Depends how quickly you sell that lightly used car you just bought. ;)
No it doesn't. You're just wrong. A used car does not depreciate as much as a new car does when it's sold. My example proved it. Selling it quickly doesn't matter. The condition does.
 

Mk_GTI

Ready to race!
Location
Hellinois
Car(s)
2018 Golf R
No it doesn't. You're just wrong. A used car does not depreciate as much as a new car does when it's sold. My example proved it. Selling it quickly doesn't matter. The condition does.
I was in the car biz for five years. Hate to break it to you, but it can.

Most cars lose around 50% of value in the first three years. How much of that percentage is lost by the first owner depends on a bunch of factors, one of which is the initial value lost is calculated from MSRP, which is where that 20% figure comes from. How much is actually lost after buying new depends on: original purchase price when new + market value at time of resale + method of sale (Trade in at Wholesale value or Private sale) + agreed upon sale price when selling as used.

You are not getting a 25% savings on that new car when you can get a brand new one for 10-15% off MSRP. I made quite a bit of money selling "lightly used cars" to people with your fixed mindset.

Your mileage will vary.

The larger point that seems to be completely lost on you is that every scenario is different, so there is no true accurate numbers. In most cases, a used car can lose another 20%.
 
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jimlloyd40

Autocross Champion
Location
Phoenix
Car(s)
2018 SE DSG
I was in the car biz for five years. Hate to break it to you, but it can.

Most cars lose around 50% of value in the first three years. How much of that percentage is lost by the first owner depends on a bunch of factors, one of which is the initial value lost is calculated from MSRP, which is where that 20% figure comes from. How much is actually lost after buying new depends on: original purchase price when new + market value at time of resale + method of sale (Trade in at Wholesale value or Private sale) + agreed upon sale price when selling as used.

You are not getting a 25% savings on that new car when you can get a brand new one for 10-15% off MSRP. I made quite a bit of money selling "lightly used cars" to people with your fixed mindset.

Your mileage will vary.

The larger point that seems to be completely lost on you is that every scenario is different, so there is no true accurate numbers. In most cases, a used car can lose another 20%.
We'll just have to agree to disagree.
 

Golfer883

Ready to race!
Location
IL
There is a guy selling a 2018 gti SE with like 12,000 miles near me for 22,000, like new. I can get a new 2019 gti SE for 5 grand off sticker so 30,000. I can maybe talk the guy down to 20 grand so I would save 9-10 grand vs new.

Once I bought that 2018 gti SE for 20 grand. I could turn around a month or two later and still get 20,000 if I sold privately. There isn’t any immediate depreciation, kbb doesn’t ask what owner in line you are before giving a number you can reasonably ask for, it may not look as good being second owner though.

Trading in a car is different, they rip you off each way they can. You had some good points about the used car having tires, brakes etc with more wear but you are still saving like I mentioned above, 9-10,000 dollars
 

Mk_GTI

Ready to race!
Location
Hellinois
Car(s)
2018 Golf R
There is a guy selling a 2018 gti SE with like 12,000 miles near me for 22,000, like new. I can get a new 2019 gti SE for 5 grand off sticker so 30,000. I can maybe talk the guy down to 20 grand so I would save 9-10 grand vs new.

Once I bought that 2018 gti SE for 20 grand. I could turn around a month or two later and still get 20,000 if I sold privately. There isn’t any immediate depreciation, kbb doesn’t ask what owner in line you are before giving a number you can reasonably ask for, it may not look as good being second owner though.

Trading in a car is different, they rip you off each way they can. You had some good points about the used car having tires, brakes etc with more wear but you are still saving like I mentioned above, 9-10,000 dollars
Congrats, you got a decent deal at $4k under market. That's wholesale value, which is why you can immediately turn it around for what you paid, but you are losing out on any profit because you're selling it for well under market value not to mention whatever costs you incurred buying the vehicle (tax, title, license, etc).

BTW, you're not "saving $9-10k off new". You are buying a vehicle that has been in service for one year and 12k miles. You save "$9-10k off new" when you buy a brand new one for $9-10k off. Don't fool yourself with the semantics.

Not every deal is the same. People sell for different reasons and for different prices. Some people know the car market, most don't. There's too many factors to say that all cars depreciate 25% instantly but no used cars ever do" to be firmly true.
 

Golfer883

Ready to race!
Location
IL
Congrats, you got a decent deal at $4k under market. That's wholesale value, which is why you can immediately turn it around for what you paid, but you are losing out on any profit because you're selling it for well under market value not to mention whatever costs you incurred buying the vehicle (tax, title, license, etc).

BTW, you're not "saving $9-10k off new". You are buying a vehicle that has been in service for one year and 12k miles. You save "$9-10k off new" when you buy a brand new one for $9-10k off. Don't fool yourself with the semantics.

Not every deal is the same. People sell for different reasons and for different prices. Some people know the car market, most don't. There's too many factors to say that all cars depreciate 25% instantly but no used cars ever do" to be firmly true.
go to kbb.com and look up 18 gti SE minus leather with 12,000 miles. In excellent condition private sale range is 21,800 - 23,600 so he has it priced right at 22,000. Not sure where you are getting 4g under market?? He’s literally using the kbb used value for private seller
 

Mk_GTI

Ready to race!
Location
Hellinois
Car(s)
2018 Golf R
go to kbb.com and look up 18 gti SE minus leather with 12,000 miles. In excellent condition private sale range is 21,800 - 23,600 so he has it priced right at 22,000. Not sure where you are getting 4g under market?? He’s literally using the kbb used value for private seller
KBB, NADA, Edmunds, etc are nothing more than a rough guide that leans heavily towards the consumer and tends to give generous numbers because they want you to use their service to make money. Black Book is the most accurate because the vehicle values are figured using actual auction data, but you need to be a dealer to get that.

Autotrader.com and Cars.com, where actual cars are priced with actual prices, the average 2018 SE with a manual, 12k miles is around $23.5-25k. Go look for yourself at www.cars.com. The prices dealers list on the internet are usually close to their bottom price.The internet has definitely shifted car buying power to the buyers. The longer it sits in inventory, the more the price drops until the dealer sends it to auction before they lose money on the car - usually 90 days.

Remember, the only true number is what someone actually pays you for your car and what number you are willing to accept.
 
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Golfer883

Ready to race!
Location
IL
KBB, NADA, Edmunds, etc are nothing more than a rough guide that leans heavily towards the consumer and tends to give generous numbers because they want you to use their service to make money. Black Book is the most accurate because the vehicle values are figured using actual auction data, but you need to be a dealer to get that.

Autotrader.com and Cars.com, where actual cars are priced with actual prices, the average 2018 SE with a manual, 12k miles is around $23.5-25k. Go look for yourself at www.cars.com. The prices dealers list on the internet are usually close to their bottom price.The internet has definitely shifted car buying power to the buyers. The longer it sits in inventory, the more the price drops until the dealer sends it to auction before they lose money on the car - usually 90 days.

Remember, the only true number is what someone actually pays you for your car and what number you are willing to accept.
so you are going off dealer prices vs private seller, aka the guy who lives next to you. I agree dealer prices are higher than kbb private sale. The dealer has expenses they pay (salesman, managers, maintenance etc etc ) for the cars on their lot so they charge more than the guy up the street selling his car. Plus the dealer will the tools to detail the car better than your neighbor selling a car plus they are much more convenient. That’s the reason they are able to charge more, I can list my car for dealer prices but I’m going to have a hard time selling it since I don’t offer the perks the dealer has.
 
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