Are you getting tired of commuting? Maybe you feel anxious about contracting the virus when riding public transport vehicles. These are just some of the many reasons people think this might be the perfect time to invest in a car. Aside from its obvious convenience, there are practical factors that make car-buying attractive these times.
We are still in a recession, which means the market is brimming with used cars, and dealers offer great packages and discounts to keep up with the competition. Being digitally equipped could be the best way to find great deals as most car dealership also market their product online. All details that you wanted to know about cars are readily available on the internet, so always take time to check them.
However, though buying a vehicle may seem like a simple procedure, most buyers still end up wondering what kind of car they are going to purchase. An expanded list of options can also make your buying process more complicated. To summarize all the answers to car buying’s frequently asked questions, here are the pros and cons worth considering to guide you.
Advantages of Brand New Cars
- Mode of Payment: When buying a used car, one of your first possible limitations to consider is the number of ways in which you can pay for it. Certain institutions do not finance vehicles over a certain age, which means you would have to pay it in cash. Banks may offer a better means of financing by lowering the interest rates, plus dealers also tend to offer many incentives and discounts.
- An assurance of quality and performance: Performance wise there is always an upscale advantage when owning a brand new car. Engine failures and system malfunction are limited. It already undergoes multiple tests before being sent out to various car dealerships. However, it is always advisable to purchase cars on a trusted brand to ensure quality and performance.
- Warranty: One of the most significant advantages of buying a new car is the warranty since most new vehicles have minimal repairs in their first few years. Making use of the car’s warranty could guarantee to limit future maintenance expenses.
- New technology: Advanced mechanical technology is one of the advantages of owning a brand new car. This can be in the form of an advanced driving safety system or new engine technology that improves performance or cuts down on emissions. Car emission testing is also one of the requisites when registering a vehicle in compliance with Republic Act No. 8749, or the Philippine Clean Air Act of 1999, so you can guarantee that your brand new car is already future proof when it comes to its annual registration.
Disadvantages of Brand New Cars
- Price: Brand new cars tend to be more expensive if you acquire the latest and advanced model.
- Future value: A new car takes its most significant depreciation in the first two or three years. This means that you are throwing away several thousand pesos that you will never be able to get back. From a financial standpoint, it doesn’t make a lot of sense to buy a new car unless you have the money and you do not mind losing it.
- Insurance: Having high insurance premiums could most likely be possible when purchasing a brand new car.
Advantages of Used Cars
Value for Money: As mentioned earlier, the depreciation value of a used car is already paid off by its previous owner. Therefore, its value is already cheaper compared to its original price.
Insurance: Financing the insurance premiums is also affected by the age of the vehicle. The older a car is, the cheaper is its payment on insurance premiums. But this is relative, depending on the type of car you own and the type of insurance premium you will avail.
Disadvantages of Used Cars
Reliability and credibility of the dealer: One of the most important things to consider in buying a used car is the information or the car’s history. Make an extra effort on researching or even hiring a mechanical specialist to make sure that the vehicle is in top condition when acquiring it. Do not be fooled by the looks. Always check its condition. If you are lucky enough, some dealers will give you such information, but it is still advisable to do your research.
Mechanical issues: Engine or system malfunction could be one reason why the previous owner sold or returned the car. Thus, it is crucial to take your time when checking it or even bringing a trusted mechanic to inspect the vehicle.
Warranty: Lack of warranty is another disadvantage in purchasing a used car. Hence, maintaining the car’s condition could be more expensive in the long run.
Outdated technology: One of the downsides of purchasing a used car is its obsolete technology. Most modern vehicles are equipped with new systems that can connect to mobile devices. In addition, if convenience and ease of use is your only priority, then this would be less important.
Making a Decision
Whatever decision you may end up with, your family’s safety should be your utmost priority. It is also wise to assess yourself first before deciding. Avoid being an impulsive buyer. Always take time to understand your options. Buying a car, especially when financing it through a bank or other financial institutions, could create a significant toll on your financial capacity in the next few years.
On the other hand, purchasing cars solely for investment or selling them in the future might not be the most sought option, as vehicles have a lower guarantee of return. It depreciates rapidly through time, so always consider having an alternative means of investment like stocks, cryptocurrency, or real estate. Having a more stable passive income could guarantee that it will make the decision process more manageable.
Camella, the country’s number one house and lot and township builder, is a perfect example. They offer various house and lots that will surely give you many options when starting your investment journey. Either it is for rental purposes or personal use. Real estate investment has always had a significant appreciation value over the next few years. So, consider other means of investment to finance the monthly payment or expenses of your future car.
To sum it all up, deciding on buying a car could be much easier if you have all the funds to finance it. So assess yourself first, check if you can manage its finances, and do not forget to expand your horizon in investing. To learn more about your investment options, check out Camella’s list of available house and lot offerings.