Why a Pre-Owned Chevy Might Be The Smartest Buy You Could Make

From the New England states to southern California, the Pacific-Northwest to the Florida panhandle (and everywhere in between) there are a record number of car buyers opting for pre-owned vehicles over new. Why? Because there are countless reasons why doing so proves to be a better investment in the long run. So if you’re shopping for used cars Dayton Ohio dealerships (or those in Fort Collins Colorado or anywhere, for that matter) expect them to serve up a few validations of your car buying plans. And with that in mind, let’s see if we can beat them to it, by taking a closer look at the reasons why so many people are buying used, and never looking back.

Getting to the Bottom Line

There was a time, years ago, when the decision to buy a used car carried the implication that the buyer simply couldn’t afford to buy something new. Outside of accommodating the financially strained, it was often associated with the purchase of secondary household vehicles or transportation for teen drivers. Rarely was it done out of a sense of long-term financial prudence.

But there were savings to be had. Of course there was a lower price tag, and lesser need for financing in many cases – with lower interest rates to be enjoyed in the instances that it was. But factor in the likelihood of reduced registration and insurance costs, and you’ve still only scraped the surface of why a pre-owned vehicle makes more sense financially.

Appreciating Depreciation

The aforementioned bottom-line is that a vehicle is a depreciating asset. Every minute of ownership equates to a reduced return on the buyer’s original investment. We’ve all heard people talk about how a car begins to decrease in value the moment it’s driven off the dealer’s lot, but it’s quite factual…to the tune of an 11% reduction in value before the rear tires even hit the street.

Setting aside the laws and practices that prevent a buyer from being taken advantage of in this way, imagine that you’ve purchased a brand new vehicle for $30,000. If you were to have immediate second-thoughts, turn around and drive right back onto the lot with the intention of securing a refund, the dealership might barely offer you $27,000 for the immediate return. And while that scenario is far from any sense of reality, it goes without saying that depreciation accelerates further with time since the majority of depreciation occurs within the first five years.

Once you’ve owned that $30,000 vehicle for a year, it will have decreased by up to 25% meaning that it’s already valued as low as $22,500. By the time three years have passed it will be worth up to 54% of the original sales price. And after five years, all, it will only be worth about 37%, meaning that it’s now valued around $11,000. Expecting far less in terms of trade-in value (the dealership does need to make money, after all) it’s easy to see how your hopes of a strong ROI are squashed pretty quickly.

On the other hand, the purchase of a pre-owned vehicle means that the original owner shoulders the lion’s share of its depreciation. And while that means that depreciation during your term of ownership will be slower, the real benefit is that you actually get more car for your money. This is because the depreciation endured by the previous owner has made that vehicle more affordable for you. It means that a more expensive model or trim level might now fit your budget, where you might not have been able to afford it if you attempted to buy it new.

And therein lies one of the major incentives for purchasing a pre-owned vehicle, the fact that it empowers the second owner. After all, who wouldn’t enjoy improved performance, enhanced amenities, or more luxurious transportation in general, right?

Greater Selection

But here’s where it gets fun. When addressing the benefits of buying new, many people might mention the opportunity to customize one’s new vehicle, direct from the factory. Of course, one doesn’t have the same kind of options when buying used and might have to make certain compromises in terms of make, models, trim levels, colors, etc.

But do they really?

Imagine that each year, 300 model year offerings are introduced with all major automakers combined. It’s an arbitrary number, sure, but you get the point. Of these, some will be full next-gen offerings, while others might simply be refreshed or facelift; others will be unchanged from that of the previous model years. But (disregarding trim levels, paint colors, etc) there are 300 choices for that particular model year. What if you were looking to buy a vehicle that was between 3-5 years old? You’ve now tripled the number of choices available to you. Bottom-line, if you’re willing to explore, you might find out that you have more choices available to you than you originally thought.

The Elephant in the Room

But doesn’t a pre-owned vehicle rob you of the chance to enjoy its ‘worry-free’ years? Aren’t you just offsetting any savings with the cost of repairs you’ll have to perform down the line?

Sure, an older vehicle is likely to experience more issues than a new one (that’s just common sense). But performing your due diligence, in terms of securing a reliable vehicle inspection, demanding a vehicle history reports, and trusting your gut in terms of red flags will help to minimize your risk of purchasing a vehicle that’s rife with problems.

In addition, maintenance will play the prominent role in your hopes for long-term satisfaction. First, is the quality of maintenance the vehicle had been provided with by the original owner (easier to understand if you’ve taken the steps outlined above). But with continued care and preventative maintenance, many cars are lasting longer than ever. In fact, the average length of ownership for a vehicle sits at around 6 years while the average vehicle life falls in around 11 years. If you’re buying a car that’s 3-5 years old, you could easily enjoy 5-8 years of ownership (if not more).

But what if the lack of assurance is a real sticking point for you? Well, you can have the best of both worlds — the savings of a pre-owned vehicle, albeit with both comfort and confidence.

Certified Pre-Owned Programs

Most every automaker offers a CPO program worth exploring. These programs allow a dealership to qualify pre-owned vehicles for extended warranties and a wide range of perks (24/7 roadside assistance, among others) as long as the vehicle meets certain criteria. And if the above isn’t assurance enough, the criteria they must meet put age, mileage and wear restrictions on any vehicle, ensuring that only the best ones receive certified status. In addition, any major parts or operating systems that don’t meet factory specs will be refurbished, repaired or replaced to ensure that they do. All in all, it’s worth a closer look.

Buying Used is a Smart Decision

We don’t mean to imply anything negative about the decision to buy new, quite the contrary. But any stigma related to buying a pre-owned vehicle is long gone, and there are countless ways of creating a satisfying car-buying (and car-owning) experience, agreeable with both your lifestyle and your budget. So get out there, and find out for yourself.