When you are in the market for a used car, you will likely hear from well meaning friends or relatives, or read from many a used car buying guide, that the only way to get a good deal on a car is through private sellers. Generally, the cheapest deals are found on the private market, but you pay for that low price with a whole host of other potential issues.
That’s not to say you won’t find the perfect car, at a phenomenal price, that will last you years to come on the private market. But sometimes it’s worth carefully considering both options. Finding a car on the private market can be incredible, or disastrous – whereas purchasing from a dealership is a pretty consistent experience.
Purchasing a car from a dealer will generally mean a couple of hours to test drive, discuss the price, conditions and financing, and then settle the deal. A private sale usually doesn’t take more than an hour, but it might take many different viewings to find the right car, at the right price.
There are a whole host of other differences between buying a used car from a dealership versus private sales. Here, we’ll go through some of the big ones to help you answer the question… Should you buy a used car from a dealer?
Why buy from a Private Seller
Deals to be found!
For those choosing to buy a used car (or even a new car for that matter), price is by far the most important factor. And this is where buying from a private seller may be of most benefit to you. Often you will find that there is much more space to negotiate down the asking price of the car. Private sellers are usually looking to offload their car as painlessly as possible and are not so tied up in making sure the business is profitable and running on acceptable margins. They may also have an urgent reason to make a quick sale, and will be more willing to accept a lower price.
Private sellers aren’t running a business, they’re just trying to get as much money for their car as they can while balancing it with effort and time. This means they’re incentivized to cut you a good deal, and potentially sell the car far below it’s worth.
A relaxed, casual experience.
Private sellers usually have one car for sale and are not driven by commercial profits or income. Because they’ve only got one goal – get rid of their car for as much as they can reasonably get, the experience will be much more casual.
But this might not always be good. A private seller may not care enough to show you all the features, tell you about all the little quirks of the car or really take the time to make sure its the car for you. They only have to sell one car, once – so don’t need to think about the buying experience or making sure the customer is looked after.
First hand information.
As the seller is usually the owner of the car, they will know more about the history of the vehicle. They are the best source for a more complete service history, and being the driver will be able to share any little quirks or niggles that the car may have. It is still advisable to do your own independent research such as a PPSR check and a thorough inspection of the vehicle.
A dealership’s sales representatives will do their best to tell you about the history of the car, and there’s peace of mind knowing the specialist technicians have checked it over. But the truth is that they’ve never owned the car, or driven it every day for a considerable amount of time – so they might not have the full scoop.
Be wary though. A private seller will know everything about the car, including potentially problematic issues that are starting to rear their ugly heads. If you ask questions of a private seller about potential issues, and they dodge the question or drop their price – proceed with utmost caution.
Why Buying from Privately May Not be a good idea
Checks, paperwork and thorough investigating.
In a private sales situation, it is up to you (and the seller) to make sure you have all the necessary paperwork completed and submitted. Getting things wrong can be costly, confusing and cause problems you don’t need.
Make sure to check encumbrance on the vehicle, current registration status and whether it’s ever been written off in an accident. Buying a car without the necessary paperwork in order will come back to haunt you.
In the private market, cars are generally sold “as-is”. This means no warranty or refund. So if the car breaks down on the way home after you’ve paid and taken possession of the vehicle, you can’t go back and ask the seller for your money back. Make sure you do a proper inspection!
The best course of action when buying a used car, is to take it to a qualified, reputable mechanic for a pre-purchase inspection. Ideally, the mechanic you’ve been using so far. It’s a cheap, painless exercise to save you a whole lot of money and heartache.
Asking to take a car for a pre-purchase inspection is also a great way to test out the seller. If they object, or have excuses why you can’t take the car to the mechanics, run away! Those are major red flags, any honest person selling a car will be more than happy to let you take the car for an inspection, or agree to go with you for one.
Get read for a long, exhausting search.
When looking for your ideal used car in the private market, you may find yourself waiting longer for the right car to show up. And when it does, there is effort in organising inspection times (some cars go quick) and then having to potentially travel long distances across the city to view the car. This is a process you may find yourself repeating if you’re unlucky in your search.
Often, the used car buyer finds the perfect vehicle, at the perfect price, only to have it whisked away before they can make it theirs. Or, they arrive to view and find the car is not quite as advertised, or their mechanic informs them of a fatal problem. Expect all of these issues when searching for the right car, so you’re not disheartened when they come up.
Remember there will always be another car. Don’t rush into things, and make sure you get it right!
Reasons to buy a used car from a dealer
Warranty and legal protection
If you’re afraid of buying a lemon and in need of that extra peace of mind, buying a used car from a dealer will be ideal for you. Used car dealers are bound by Australian Consumer Laws and also have to provide statutory warranty as prescribed under the Motor Vehicle Dealers Act. The statutory warranty applies to vehicles sold with a price of more than $4000, is not more than 12 years old, and travelled less than 180,000 km.
All used cars sold by Perth City Skoda are given a comprehensive inspection with any necessary repairs being conducted before they are put out for sale.
Paperwork and Finance is made Less Stressful
Buying a car is one of the biggest transactions in our lives can make it a somewhat stressful situation, and dealing with paperwork can seem overwhelming or confusing. The good thing with dealers is that selling cars is what they do day in and day out, so they will be able to take you through all the administrative requirements, eliminating much of the headache.
It can be a difficult and time-consuming experience trying to get finance on your own, and this is especially the case for used cars. So the fact that many dealers will be able to offer you finance means that all the legwork is done for you.
More choice in a single location
As opposed to one car per private seller, dealers that sell used cars will usually have a range of different cars for sale. This includes vehicles across all makes and models, so chances are there may be something suitable. A bigger selection in one place may also mean a shorter search process.
The downside of dealers
Generally, cars cost more at dealerships. This isn’t a scam, unfair or anything of that nature. A car dealership is a business, and their mission is to get people into the right car, and make sure that car is a good one. Ensuring cars are clean, serviced, thoroughly checked and ready to serve you well isn’t free, and neither is providing experienced and knowledgeable sales representatives to answer your questions and help you choose the perfect car.
If less than spotless cars and a bit of an oil leak don’t bother you, and you’re an expert on cars of all makes and models, maybe you don’t need what a dealership offers. But a warranty, ease of service and the transaction peace of mind a dealership gives you, that’s hard to put a price on.
No Free Rides.
Well, that’s not technically true. The test rides are all free, and if you choose not to buy any of them that’s fine (but be careful, you might just fall for one of the cars!).
What is true, however, is that dealerships aren’t motivated by the same things as a private seller. They’re not trying to get rid of a car, so they can pick up a new one. They’re employees of a business selling a product, and that product has a cost – they’re not going to just lose money on a product to make the sale!
While that doesn’t mean there isn’t room for negotiation and deals, it does mean that you’re not going to find a jaw-dropping deal because someone has to leave the country tomorrow. So just bear in mind the reaction you might get at the supermarket, if you asked the cashier to knock 40% off your grocery bill!
So… should I buy from a dealer or not?
Obviously, we’re going to tell you to buy from a dealer. But, we’re a little biased. The real answer to the question is up to you. How experienced are you with cars, and how much time have you got?
If you’re looking for a car that you can get in, drive away and not have to worry about? Backed by a great warranty and the surety of buying a checked, serviced and inspected car – a dealership is almost always going to be your best choice.
There’s a saying, ‘the poor man pays twice’. This essentially means that by going for the cheapest option at the start – you might have to pay more later, especially if you accidentally buy a dud with no warranty.
But if you’re a car enthusiast that loves tackling problems and is more than happy to take on an unknown vehicle, go for private. You’ll save money by doing things yourself, and skip the warranty because you don’t need it (hopefully!).
Whatever option you choose, if you’re in the market for a used Skoda, come down to Perth City Skoda and test drive the cars and speak to the helpful staff. Even if you don’t necessarily find the car you’re looking for, get equipped to with the knowledge you need to choose a great car.
Who knows, you might even find the car of your dreams right here on the lot!