Are low mileage, low rust, good condition cars worth more than book value? How much? - Subaru Outback - Subaru Outback Forums
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post #1 of 45 (permalink) Old 05-02-2018, 08:39 AM Thread Starter
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Are low mileage, low rust, good condition cars worth more than book value? How much?

Are low mileage, low rust, good condition cars worth more than book value? How much?

One of my criteria for buying a vehicle has been not paying more than book value - as determined by Kelley Blue Book Fair Market Value, Edmund's True Market Value, and NADA. I thought those would all be more than fair to dealers, because they get most of their money from dealers' paid ads.

I get that modern cars have better gas mileage and rust resistance. But I really couldn't care less about modern gimmicks like Bluetooth, Android Auto, or style. I only care about reliability, and the costs of purchase, maintenance, insuarance and repair. So, I have assumed a car that has few miles, and that has little rust, and no mechanical problems, is almost like a newer car of the same mileage.

I know that isn't quite true. Some things - tires, seals, exhaust systems, rust, and probably other things I don't know about - apparently are as much dependent on age as mileage. But I don't know how to estimate that - how much a year of low mileage driving (e.g., 1/2 or 1/3 mileage driving) increases such problems, in proportion to an average year of driving. Also, replacement parts are harder to find for older vehicles - but people say that the Internet used parts market, and after-market parts, have largely eliminated that problem, at least for common vehicles.

It is much cheaper to insure with full coverage an older vehicle, because my insurance company ignores mileage – though if you have an accident, the insurance company only gives you book value.

The models I have been looking at depreciate in book value by about $2000 - $3000 / year, but maybe by 1/5 to 1/10 that by mileage, in terms of the nominal average 12,0000 - 15,000 miles / year that typical people drive. So, I've been looking at low mileage older vehicles, that have very little rust, including on the underbody, and that have nothing mechanically wrong with them.

In several attempts, car dealers haven't been unwilling to negotiate these vehicles down to book value. They say that book value undervalues low mileage good condition cars, and that a lot of people are willing to make the same tradeoffs as me, so that they can get much better than book value on them.

Are they right? And if so, how can I estimate the true fair market value of low mileage, low rust, good mechanical condition vehicles?

(BTW, my other vehicle criteria: economically priced; good gas mileage; a reasonably reliable brand with many dealers and available parts in rural areas: Toyota, Honda, Nissan, Subaru, Ford, Chevy, in that order. AWD or 4WD; at least 7" of ground clearance; seats that fold flat enough to accommodate car camping and a 6'7" kayak inside; at least with a camping pad or platform. Sufficiently flat roof to mount roof racks with widely spaced bars for longer kayaks, and the ability to mount front and rear tie downs. An AM/FM radio. Light exterior color to stay cool. There are about 10-20 common models meeting all these criteria, in at least some lines. These would be nice, but are NOT essential: manual transmission; manual windows; a moon roof; low enough roof line for easy car-top kayak tie down, and for parking garages; regular gas, space for a full size spare; sufficient tire clearance for emergency snow chains or cables. Yes, I know chains are extremely hard on AWD and 4WD mechanisms, and many owner’s manuals explicitly bar them, so would only use them at very low speed for just long enough to get unstuck.)

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post #2 of 45 (permalink) Old 05-02-2018, 09:09 AM
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Depending on your area your going to have a hard time finding a car at or under book value.

For instance here in minnesota I paid $8,000 for a 05 OBXT with under 100k miles and no rust.

That is over market value but in the area around $8000 is the going rate for that car just based off of supply and demand.

So in the end it really just boils down to if its worth it or not to you.

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post #3 of 45 (permalink) Old 05-02-2018, 09:30 AM
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If you substitute the words high mileage, high rust and bad condition for what you wrote you will have answered your own question.
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post #4 of 45 (permalink) Old 05-02-2018, 09:44 AM
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Have you tried using cargurus.com for your vehicle search?

What exactly do you mean by "economically priced"?
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post #5 of 45 (permalink) Old 05-02-2018, 10:00 AM
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one of the flaws in your car search is buying from a dealer that has no records. (sometimes they have no records on purpose).

better,...ones listed as "head gaskets fixed":

buying from a shop that fixes subarus and has 10 sitting outside. (maybe some gas hog maint. intensive turbos,...but not for you).

or a individual that has one for sale,...(classically one that needed a minivan, to stop 3 children from kicking the front seats).
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post #6 of 45 (permalink) Old 05-02-2018, 10:07 AM
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You may be overvaluing the relative quality of the car vs. other market factors.

A given low miles, no-rust, older car's value goes down when it is being sold in a ghost town with no economy.

The exact same car will sell for much more in an area where people have enough money and free time to enjoy outdoor sports.

If you were able to find the car using an app or a web browser, you'll pay for that privilege. Somebody has already spent money and/or effort to clean and market it, they'll want more to cover the effort. You can find great opportunities for savings if you put the time in on older search methods.
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post #7 of 45 (permalink) Old 05-02-2018, 10:41 AM
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There are two things you can count on from a car dealer:

1- when buying, the car you are looking at is in high demand so they don't have to lower the price for you.
2- when trading in, the car you are selling is in low demand so they cannot give you market value for it.

Doesn't matter what car, where or what time of year. These two things will always be true.
If you are really trying to get the lowest price, my suggestion is retain a good mechanic or a service that can inspect a used car, and then shop from individual sellers. Dealers have to mark up prices to pay for all their overhead. An individual seller doesn't.
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post #8 of 45 (permalink) Old 05-02-2018, 02:00 PM
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it's 'possible' to get a bargain from almost any source. Dealers are often able to get used cars at very low cost due to the whole trade-in 'shell game'. If they do stand firm on a high price, they might throw in a small powertrain warranty or a maintenance contract to move the car.

But if you aren't in a hurry, try some old-school and 'creative' shopping methods as mentioned. Fin 1 or 2 local soob-friendly shops. Visit them to ask about a pre-purchase inspection AND if they have any customers considering selling. could be a win-win

church bulletin boards, retirement communities might be good sources.

avoid bank repos - if someone couldn't make their car payments, do you think they were doing oil changes?

but when it comes to used cars, past care and present condition trump price only. That cheap car you 'scored' could have rod knock develop in a few weeks.....
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post #9 of 45 (permalink) Old 05-02-2018, 03:15 PM Thread Starter
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Quote:
Originally Posted by rasterman View Post
You can find great opportunities for savings if you put the time in on older search methods.
What older search methods?

People used to sell cars in newspapers. But they seem to be empty of car ads now.

People used to sell cars on grocery store bulletin boards - but not any more, where I have looked.

A university near me used to have a bulletin board full of cars for sale - but it is gone now.

I have tried many internet sites, including:

auto
autotrader (which has SOME private sellers)
caranddriver
cargurus
cars
carsdirect
carsforsale
cars.usnews
craigslist (which also has some private sellers, though the cars I looked at were by curbstoners; I'm not sure if that should matter, though it does limit personal knowledge, and might reflect on honesty)
edmunds
fredericknewspost
iseecars
kbb
nada
truecar
washingtonpost

I will hire a mechanic to do a pre-purchase inspection before the final buy.

One problem is that there aren't that many used cars with the desired characteristics in good condition. Perhaps my standards for good condition are pretty high. Most used cars do have a lot of rust. Most people don't sell used cars unless they have something mechanically wrong with them, that needs a major repair.

Another problem is that I need to put an absolute cap of about $14,000 on it - preferably less. There are lots of cars for less than that that have problems. Not so many with the desired characteristics that don't. And I looked for vehicles that have already passed a Maryland state inspection. Few used cars sold by private parties can, and most require major expensive work to do so, because Maryland is very picky about things, like small rust holes in the body, and tint, that probably don't matter.

I have indicated I was looking on three widely viewed discussion boards maintained by outdoor sports clubs. One private person contacted me. Looked at his car, because he didn't want much for it, even though it wasn't state inspected, and didn't look that great. It had some rust, a few mechanical problems I guessed wouldn't be too expensive to fix, had a mechanic look at it - who said it was going to need many thousands of dollars of repair, that the mechanic though weren't worth it.

I have believed book value web sites, and mostly ignored cars and trucks advertised at much over book value. Most of the few that aren't are indeed in rural areas distant from me. I need to rent a car to look at them, which limits things.

I was too slow to pick up one vehicle. I saw it, went home to do research, but someone else bought it the next day. The owner was asking twice book value - but it was a well maintained difficult-to-find high demand 15 year old Honda Element with less than 21,000 miles, complete service records, driven by someone who had good reasons to keep it in good repair - in effect, virtually new, except for some rust on the exhaust system. The owner felt, apparently correctly, that he didn't need to bargain much if at all on price.

I looked at a dealer car that was about $1800 over book, including some expensive options and a fancy trim line that don't matter to me. A very good condition 2008 Subaru Forester with about 66,000 miles. (But: No keyless entry. There is only one door with an external lock - and from personal experience, car locks eventually go bad. What a horrible design feature.) The dealer didn't want to bargain. His final offer was $200 below advertised price. Maybe I should have bought it. Maybe I still could, though it is likely gone - a lot of people were visiting that dealer, and looking at that car, while I was there.

I looked at a less common vehicle that is about $1000 over book, and is a little over the limit I want to pay - but has most of the characteristics that I want, except for color. It would get even more expensive after the addition of roof racks and tie downs. I saw it early in my search, thought I could do better, and didn't bother trying to bargain - but maybe that was a mistake.

Everything else I have looked at had significant mechanical defects (I'd be afraid to buy them), and/or was way over book.

So now I am trying to decide whether to drop the book-value criteria. Book value is supposed to take into account mileage and condition - but if there are so few AWD or 4WD cars and trucks with high ground clearance, low mileage, low rust, that are free of mechanical defects, maybe I am competing with too many people to hope for book value.

But - if there are other ways to look for vehicles that I haven't thought of, that some of you know, I am willing to try.
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post #10 of 45 (permalink) Old 05-02-2018, 04:08 PM
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one other crazy idea - lease a USED car.

it isn't common yet, might be difficult in a small community to find someone doing it.

but, payments can be low as the initial big hit on depreciation has already occurred. There's usually a warranty as they are often CPO or equivalent, and, if the car proves reliable/suitable, you could buy it at the end of the lease.

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