The bargain 'second-hand' cars with no previous owner
- 9 May 2014
- From the section Business
Buying a car can be exciting, but it can also be quite a headache.
One of the big choices facing buyers is whether to get something new, or a used model with a few miles on the clock.
But would you believe me if I told you that sometimes it is possible to get a new car for the price of a second-hand model?
Well, apparently you can.
The car I am looking at appears to be brand new.
It is a shiny silver Renault Megane, registered in 2014, and it has just six miles on the clock.
There isn't a fleck of dirt on it, the interior still has that unique new car smell, and its tyres have barely kissed the tarmac.
Yet as far as the motor trade is concerned, the Renault is a used vehicle, and it has a price tag to match.
It is on the market for £12,999, several thousand pounds less than you'd normally expect to pay for a new model.
Bargains like this can be found quite easily, if you know where to find them - and if you are willing to make certain compromises.
New or used?
Research recently carried out by the AA suggests three-quarters of drivers plan to buy a new set of wheels within the next five years.
For many people, the choice will ultimately boil down to cost.
"A lot of care needs to be taken," warns Ian Crowder of AA cars.
"Is the car going to be right for you - is it going do the job you want it to do? And how much is it going to cost? It's important to think about your budget and how you're going to pay for it."
"And how long do you plan to keep it? That might dictate whether you go for a new car or a used one," he says.
There are big advantages to owning a car that has never been driven.
It is less likely to go wrong, and if it does, the manufacturer will sort it out under warranty.
You know its history, and you are unlikely to find any nasty surprises.
There is a catch though. Not only are new cars more expensive to buy, they also lose their value very quickly. In fact they can be worth up to 40% less the moment you drive them away from the dealership.
New 'in effect'
Yet there are circumstances in which it can cost you less - over time - to buy a new car than a used model.
It may be the case, for example, if you are planning to pay for it on credit.
This is because manufacturers frequently offer low-cost or interest-free loans on new cars, along with other incentives which may not be available for used car sales.
A recent survey by What Car? Magazine suggests that, over a three-year period, new cars bought using a standard hire purchase agreement, or under a Personal Contract Purchase, can end up cheaper than used models about half of the time.
This doesn't mean that new cars are actually cheaper of course, simply that there are good funding deals to be had, and that credit for used cars is often more expensive.
Nevertheless it is entirely possible to buy a car that is, in effect, new, for the price of a second-hand model.
Which brings me back to that Renault.
The silver Megane is what is known as a "nearly new" or pre-registered car. It was first registered by a franchised dealer, who wanted to boost his sales figures in order to pick up lucrative incentives from the manufacturer.
In effect, the dealer bought the car himself.
"For us, our best customers are people who buy second-hand or nearly new vehicles", says Lee Arnold, general manager of Motorpoint in Peterborough.
"If you don't mind being the second owner of the vehicle, you can have massive savings off the retail price," he says.
There is a catch of course. When you buy a pre-registered car, as Mr Arnold points out, you will be listed on the registration document as the second owner, which could affect the value when you come to sell it.
If it is a few months old, the warranty will be that bit shorter as well.
There is also less choice; you have to accept what is available, and may not be able to get the precise model you want.
But if you are not worried about the colour or the number of cup-holders, there are some good deals to be had.
The key, when you're thinking about buying a car, is always to do your research first. That way you could end up driving off with a bargain - and avoid any nasty surprises.