Used car offer?

[dukebound85]

First time I am seriously looking in buying a car in the last 11 years. I have found a nice used car and am curious as to what % of the asking price I should initially offer

Any ideas? Is 80% of the price a reasonable offer?

I know some of you had much experience in this setting and I would greatly appreciate advice

Thanks!

 

[Abyssgh0st]

It depends on quite a few things.. just to name a few:

1. The dealership. Are they a massive dealership or relatively small? They are all about making money but if every penny saved is a penny earned, you'll probably 'earn' more at a larger dealership.

2. The car. Newer, older? Dealerships are in love at the moment with putting a $1-3K markup on 'fuel efficient' used cars (basically anything with a combined 23+MPG), so keep that in mind. Rather inflated at the moment.

3. Timing. Try to go at the end of the month, when salesmen will work their hardest to try and get you the best deal possible because if they need 1 more sale to hit that $1,000 bonus then they will definitely work harder for you- who knows, you might get lucky.

80% might be a little lot, especially if it's like a $12-15K car. That would make a $15K car $12K (before TT&L, of course). I'd say check nada.com (not a fan of KBB due to high estimates, and many dealers I've worked with prefer NADA), and try and get $1,000-2,000 off of that price, assuming your budget is over $10K. I don't see you getting a car listed for $8K under $6.5K (20% off).

Just a few things I've learned, I've bought 4 used cars in the last 3 years.

 

[CorvusCamenarum]

For new cars, I try to figure the actual dealer cost, then add 5% for my target price. For used cars, this can be a bit trickier, since the markup is usually much more. Remember, this is where dealers make their money; the profit margins are much higher than those of used cars. Theoretically, you have more wiggle room here.

I'd probably start with looking at the Blue Book value of what car you're considering buying, and go from there. Remember, he paid somewhere close to the wholesale price. Get the vehicle history, too.

 

[dukebound85]

THe car I am looking at is a 2009 Imprezza with a premium package. Listed for 18950.

I have looked at KBB Trade in to get an idea what the dealer paid and it is ~16.3 for excellent and 15.4 for good.

I also looked at edmunds for the tmv and for dealer is lists 16.7

I think an offer between the trade in and tmv would be realistic right?

 

[CorvusCamenarum]

I wouldn't go higher than $17,500, depending on condition. What sort of condition is it in and how many miles are on it? Is the dealer offering any sort of warranty? I'd probably take the car to an independent mechanic and have them take a look at it before you make an offer, they might find something with dealer...overlooked.

 

[Rooskibar03]

Used cars 101- Online Book Values mean nothing right now.

The used car market is on its ear. There is a shortage of cars and prices are higher then I've ever seen them in the 9 years selling cars. We pay way more then KBB price just to get cars, which doesnt leave much of a return once you factor in reconditioning and generating a return.

Offering 20% off a used car is a good way to be told thanks but no thanks. The used car market is a sellers market right now. I dont know what part of the country you're in but if you are in any type of metro area look private if you want to get a deal.

The other thing to consider; a brand new Impreza Premium can be had for around 22k MSRP. You could lease that car for probably a $100 a month less then your monthly payments are going to be on that used car you mentioned for 19 grand plus tax.

Your only shot a used car deal at a dealer lately is a car thats been sitting on the lot a long time and they just want to dump it. (And if its been there a long time there is probably a very good reason)

Feel free to PM me if you want to bounce something off me.

 

[ender land]

I bought a car about a year ago. You need to be able to do several things to get a good deal.

1. not need a specific car. if you want one specific car (kinda sounds like you do...) you are going to be out of luck, because you HAVE to be able to say no or else you will almost never get a good deal - exceptions can be had of course, but in general, if you *need* the car or *really want* one specifically, the dealer can tell, since it's basically their fulltime job to do this
2. know what value your car is (if trading in) and what the car is worth!
3. be able to stick firm to a decent price and not cave right away to their counter offer
4. have a fairly good idea of the price point you will pay vs walk away. it's way easier to negotiate if you know "I won't pay more than 16000 for this car" than "I want a good deal!"

In the dealership the sticker was 10888 with a 9888 online price (these will often be different). The nadaguides average "clean" retail price was a bit over $9k. The car was roughly a $6825 tradein value from NADA Guides online (which as far as I know takes actual numbers for what similar cars were traded in for, etc). $1000 of that "cost" was from mileage, so the car, if you removed the average mileage effects, was valued less for tradein.

After eyeing it online and looking at it in person and getting an offer from them - which I declined - they dropped the price 1k online, so I went in and talked to them, figuring they wanted to move the car.


I offered $6900 as my initial offer (keep in mind sticker price on the lot was $9888 even with the 1k discount). This would have been 20% off the newest internet price, more off the sticker or sticker from a few days prior.

When they come back with another offer, probably maybe a small bit off the actual sticker with a sad line about how they are willing to compromise with you even though your offer is unreasonable, stick firm. Most people probably cave here, thinking they got the dealer and successfully negotiated a few bucks, while the dealer smiles and makes a lot of money.

If you are not able to convince them you can walk away and not care, and maybe you cannot, you are going to have a hard time getting a good deal on it. If you want the specific car and want to haggle down some of the cost to feel like you got a good deal, you'll get a few hundred or even a thousand or so off.

For what it's worth, the offer process in my case went like this:
10888/9888 sticker/online price
9888/8888 sticker/online price after reduction

6900 initial offer
8725 counter
7100 from me
8500 from them
7375 from me
7500 from them

I happened to initially only be looking for a $7300 sale price, but low fees (only $70 as compared with the $200 or so I planned on) as well as a good deal on my tradein ($1500 vs the $1300 or so it was generously worth) let me accept an offer slightly higher than I originally wanted.

Factors you want when you look for a new car -

• car been at dealer for a while, they want to move it
• common car, lots of them made
• not overly high demand, don't expect a great deal on a car that everyone wants
• you want to not need a new vehicle in the immediate future

If it's not one of those, be very well prepared to walk away if you don't get a great deal.

Also ask about any fees you get, many of them are probably somewhat unnecessary or negotiable. Most people just accept them from the dealer but some you can negotiate and it's part of the car cost to you as the consumer.

Hope this helps, it was somewhat jumbled and a lot of thoughts. Key to getting a good deal is to know information (car values, etc), not need a vehicle or want that specific one, and have a set price you are going to buy the car vs walk away at.

Finally I've said it before but - Be prepared to walk away!