Does everyone just buy their cars with credit or...

spengos

spengos

spengos

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Joined
11 Feb 2004
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..is everyone a millionaire?

There seem to be so many nice cars on the road these days. Seems most people are driving round in 20-30k+ cars. Land rovers, BMWs, Mercs, Audis, all seem common as muck.

Im not rich but me and the missus are both on good salaries but theres no way i could ever see us having that kind of disposable income.

I drive round quite happily in my modest 2005 Fiesta. Its the cheapest and least powerful car ive ever owned but its cheap to run and because it was a down grade i bought it with cash and now have no debt. But i do often wish i could drive something with a bit more zing!

Ive bought cars in the past on credit but i'd like to avoid doing it again. But if its "just what everyone does these days" then id be interested to know.

Bit of a ramble but i'd be interested in your thoughts.
 
The most expensive car in this street of 140k houses is an 09 merc ml other cars include:

04 318 ci
01 530i (mine)
Corsa sxi 09
Picasso 10
2x Clio 09
Couple of fiats
3x focus 51/07/55
99 mgtf
2x pug 406
Audi tt 59

Average value of a car in this street is well under 10k and age of person around 40, so no mate most people are not driving 20-30k cars.

In all but the more expensive areas a 30k plus car stands out like a sore thumb in a driveway, most of the ones you see on motorways are rep mobiles, hire cars etc.
 
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If you're talking about saloons then a lot of the BMWs/Mercs/Audis are probably going to be company cars with 2 litre diesel engine. Nice brands, but hardly exotic.
 
All the marques you have mentioned do quite competitive leasing. Pay a set amount for 24 months with servicing and warranty can be quite appealing.

This in turn means newer cars come back to the used approved market quite quickly in a price bracket affordable to a larger customer base.
 
They are almost all company cars. The tax on the eco models is very low and someone in a position which 10 years ago would qualify for a Vectra now has a low end German car.
 
Everyone seems to drive a MKV/MKIV Golf that I see, then you get the rep mobile BMW and Audis. The Mondeo seems to be becoming extinct in comparison.

Does seem like the country is loaded on finance but that's nothing new I suppose. Been guilty of the same. I'm currently debt free and will be purchasing a new car at some point this year and hope to bank loan <50% of the value over a short term rather than long term aggressive saving which will impact days out and fun times.
 
A lot of companies seem to be using the lure of the company car allowance to pay a below-market basic salary, thereby reducing pension and % of salary bonus costs. Britain loves its company cars and seemingly if you don't have a 3 series or above on your list, you're no-one.
 
I bought my Octy vRS last year on credit.......well I say credit.......0% APR loan from my mum :)

As said, a lot of these vehicles are company and/or are on lease. Of course there are also those earning a large wage too.
 
I was made redundant with a reasonable payout. I got another job a month afterwards, and in month two of my new job (notice period now up from "instant" to a month), I decided to spend some of my redundancy money on the Prius.

That's after having spent the last ten years in sub-£1k "bangers".
 
[TW]Fox;21321404 said:
They are almost all company cars. The tax on the eco models is very low and someone in a position which 10 years ago would qualify for a Vectra now has a low end German car.
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;) This is how it is for me anyway, the P11D value for my 3 series is something like 27k. I would never in a million years spend that on one of these.

The difference in cost to have that over something like an Insignia or Mondeo is pretty much zero.

It's not because I get paid loads, or want to be flash (which it isn't!), just that I needed a decent enough diesel mile muncher for the 200 mile commute when I go into the office and this was the best benefit/cost ratio.

And probably won't have it much longer :)
 
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Not forgetting of course that some of these cars (i.e. the 2008 Passat 2.0 Ltr TDI I bought a few weeks ago) are available for well below the 10k mark by the time their first (often business) owner has finished with them, so with the trade in value of my last car I only actually needed a little over 4k cash to purchase a 4 year old VW with 40k on the clock that is still under warranty (last month of a 12 month extension purchased by the previous owner).

I suspect I'll do something similar in another 3 years time, but this time go a little higher overall due to the car I'll be trading in being worth a little bit more than my last one was.

And just for the record, the cash wasn't "disposable" per se it was specifically saved for this purpose.
 
spengos said:
I drive round quite happily in my modest 2005 Fiesta. Its the cheapest and least powerful car ive ever owned but its cheap to run and because it was a down grade i bought it with cash and now have no debt. But i do often wish i could drive something with a bit more zing!

Ive bought cars in the past on credit but i'd like to avoid doing it again. But if its "just what everyone does these days" then id be interested to know.
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I avoid car finance and other forms of high interest debt like the plague, and would advise anyone else wanting to have a relatively stress free and happy existence to do the same. Give me a 2005 Fiesta that I own over some posh vehicle that is bleeding my finances dry any day of the week.

Rgds
 
I've always purchased my cars outright but this does mean I then have to drive them till they die. Really want to change my car at the mo but it's either a change of car or a house and the wife has already made up her mind :(
 
Both our cars ( daily driver for the wife, weekend fun car for me ) were bought with cash.

Mind you, it helps that we've paid our mortgage off.
 
Unless I've got the cash in the bank then I wont bother. First car was paid for in cash after working my arse off. Even in future when I'm on a higher salary I intend on buying used, depreciated cars that look more expensive than market value.

An ex colleague recently qualified as a teacher. Her celebratory purchase was a brand new, top of the range Corsa on full finance. She was gleaming with joy. What a waste.
 
I think there is allot of people who think 'I can afford to pay £500 a month on my car' so get a lease on something fancy ignoring the fact that they are just renting it...

I however save up :)
 
Lots of expensive cars in my area, generally Range Rovers, big Audis and BMWs. Go back a couple of years and people were paying for them through the huge amount of equity they'd made on their houses, now they can afford to finance them up because their mortgages cost them bugger all.
 
I just took mine on one of the PCP finance agreements. Will probably just give it back after the 3 years and get something else on a similar deal. The monthly payment is affordable so I'm not worried. I don't really want to own a nice car outright for any period of time anyway because of the depreciation.

I suppose leasing might be cheaper, but it's not something I'v ever looked into in all honesty. All methods of running a nice car are just money down the drain these days unless you get something classic that will hold its value, but it's all about how much enjoyment you get from it at the end of the day.
 
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