Buying a car in Ontario is a big decision, no matter where you are in the Golden Horseshoe. With so many options – from sleek new electric vehicles to reliable used trucks – it can feel like you're drowning in information. And let's be honest, not all that info online is, shall we say, accurate.

 

That's where we come in. We're here to cut through the noise and give you the straight talk about buying new vs. used cars in Ontario. No confusing jargon, no sales pressure, just honest advice to help you make the best choice for your needs and budget.

 

Whether you're a first-time buyer, a growing family, or simply looking for a change, this guide will equip you with the knowledge you need to navigate the exciting (and sometimes overwhelming) world of car buying.

 

And hey, we're not just here to talk. We've got a fantastic selection of both new and used cars right here in Burlington, ready for you to explore. But first, let's dive into the nitty-gritty of new vs. used, so you can hit the road with confidence.

 

 

The Price Differences

 

Alright, let's talk numbers. One of the biggest factors in the new vs. used debate is, of course, the price tag. Of course a newer model will always be the most expensive, but when comparing apples-to-apples, how big of a price difference are we talking?

 

The Honda Civic Example

 

To illustrate this, let's take a look at a popular car in Ontario – the Honda Civic. We'll compare the current prices of different model years to see how the price changes over time.

 

 

(Note: Prices are approximate and can vary based on trim level, condition, mileage, and other factors.)

As you can see, the price of a Civic drops significantly as it gets older. This is due to depreciation, which we'll discuss more in a bit. But for now, just keep in mind that a newer car will generally have a higher price tag than an older one and it'll get cheaper the older the model is (until it doesn't!).

 

When New Cars Are Cheaper

 

Now, here's where things get interesting. Sometimes, you might actually find a new car that's cheaper than a comparable used car.

 

How is that possible? Well, a few factors can come into play:

 

• Market Demand: If there's high demand for a particular used car (like a popular truck or SUV), the price can get inflated.

 

• Supply Chain Issues: In recent years, supply chain disruptions have led to shortages of new cars, which in turn has driven up the prices of used cars.

 

• Incentives: Manufacturers often offer incentives on new cars, such as 0% financing, cash rebates, or special lease deals. These incentives can make a new car more affordable than a used one. For example, you might find a new Honda Civic with a special financing offer that makes it cheaper overall than a used Ram 1500, even though the Ram's sticker price might be lower.

 

 

Car Value Depreciation

 

The Used Car Advantage (Sometimes) Depreciation is the decrease in a car's value over time. It's one of the biggest reasons why used cars are often cheaper than new cars.

 

When you buy a new car, it loses a significant chunk of its value as soon as you drive it off the lot. This is because it's no longer considered "new." Used cars, on the other hand, have already gone through that initial depreciation hit, so they lose value more slowly.

 

However, it's important to note that not all cars depreciate at the same rate. Some cars, like certain luxury models or sports cars, tend to depreciate faster than others. And some new cars, especially those in high demand or with strong resale values, might hold their value better than you'd expect.

 

 

 

Also, remember, used cars still depreciate, just at a slower rate, as we can see by the Honda Civic example above.

 

Deals and Incentives

 

One of the biggest advantages of buying a new car is the potential for deals and incentives. Manufacturers often offer special financing rates, cash rebates, or lease deals to entice buyers. These incentives can significantly reduce the overall cost of a new car, making it more competitive with used car prices.

 

So, if you're considering a new car, be sure to check for any current offers that might sweeten the deal.

 

 

Other Costs of Buying a New vs. Used Car

 

Okay, so we've talked about the sticker price, depreciation, and deals. But there's more to the cost of a car than just the initial price tag. When comparing new vs. used, it's important to factor in these "hidden" costs:

 

 

Insurance Costs

 

First up, insurance. In general, insurance premiums are typically lower for used cars than for new cars. This is because used cars are worth less, so there's less financial risk for the insurance company if the car is damaged or stolen. To be clear, it's not that strictly new cars = more expensive on insurance. To add some context, a 3-year old used car will generally have cheaper insurance than a 6-year old car. The car is worth less as it gets older therefore is cheaper to insure.

 

Of course, insurance rates also depend on factors like your driving history, the type of car you're insuring, and where you live. But all else being equal, a used car will usually be cheaper to insure than a new one.

 

 

Fuel Efficiency

 

As cars get older, their fuel economy can decline due to wear and tear on the engine and other components. So, if you're comparing a new Civic to a used Civic, the new one will likely get better gas mileage. This can save you money on fuel costs in the long run. Also, technology is improving every year to make fuel more efficient, so a new model might have improved efficeincy.

 

Of course, fuel efficiency also depends on factors like driving habits and the type of driving you do (city vs. highway). But in general, a newer car will be more fuel-efficient than an older one. Here's a list of the most fuel efficient options on the market.

 

Maintenance and Repairs

 

Finally, there's maintenance and repairs. Used cars, especially older ones, may require more maintenance and repairs than new cars. This is because parts wear out over time, and things can start to break down.

 

With a new car, you'll have the peace of mind of a manufacturer's warranty, which will cover most repairs for the first few years of ownership. But with a used car, you might be on the hook for unexpected repair costs.

 

Of course, the maintenance and repair costs of a used car will depend on its age, condition, and how well it's been maintained. But it's something to factor into your budget when comparing new vs. used.

 

Your Wants & Needs in a Car

 

Alright, now that we've crunched some numbers, let's talk about what you actually want in a car. This is where your personal preferences and lifestyle come into play.

 

Condition and Reliability

 

When it comes to condition, new cars obviously have the upper hand. They're fresh off the assembly line, with no wear and tear, and that new car smell is hard to beat. But used cars can offer great value if you're willing to do some research and find one that's been well-maintained.

 

Reliability is a bit trickier. New cars come with warranties, so you're protected if something goes wrong. But modern cars are also complex machines, and sometimes new models have unforeseen issues that only become apparent after they've been on the road for a while. Used cars, on the other hand, have a track record. You can research common problems and look for cars with good reliability ratings. A great website to check for reliability ratings is J.D. Power.

 

And then there's the middle ground: Certified Pre-Owned (CPO) cars. These are used cars that have been inspected and reconditioned to meet the manufacturer's standards. They often come with extended warranties, offering a good balance of value and peace of mind. Almost all the used cars we sell are CPO!

 

Warranties For Peace of Mind

 

Speaking of warranties, they're a big factor to consider when comparing new vs. used. New cars come with comprehensive warranties that cover most repairs for the first few years of ownership. CPO cars also come with warranties, though they may not be as extensive as new car warranties.

 

But if you're buying a used car that's not CPO, it might not have any warranty coverage at all. This means you'll be responsible for any repairs that come up. So, if you're considering a used car, be sure to factor in potential repair costs.

 

 

Safety Features

 

Safety is always a top priority, and cars have come a long way in terms of safety features. New cars often have the latest and greatest safety tech, like:

 

• Advanced Driver-Assistance Systems (ADAS): These systems use sensors and cameras to help prevent accidents, with features like lane departure warning, automatic emergency braking, and adaptive cruise control.

 

• Multiple Airbags: New cars typically have more airbags than older models, providing better protection in a crash.

 

• Stronger Body Structures: Modern cars are designed with stronger body structures to absorb impact in a collision.

 

Used cars may not have all the bells and whistles of new cars, but they can still offer good safety features, especially if you buy a used car that's only a few years old. And remember, the safest car is the one that's driven responsibly. Here's a list of the safest cars on the market.

 

Tech Features

 

Finally, let's talk tech. New cars are loaded with tech features, from touchscreen infotainment systems to smartphone integration to premium sound systems. If you're a tech enthusiast, a new car might be the way to go.

 

But used cars can also offer decent tech features, especially if you're looking at newer models. And remember, you can always upgrade the tech in a used car with aftermarket accessories.

 

 

Financing Your Ride

 

Okay, so you've considered the price tag, the hidden costs, and your wants and needs. Now, let's talk about how you're actually going to pay for your new (or used) ride.

 

How Much Can You Spend?

 

Before you start browsing cars, it's crucial to set a realistic budget. Consider your income, expenses, and savings. How much can you comfortably afford to spend on a car each month? Don't forget to factor in insurance, fuel, and maintenance costs.

 

The 20/4/10 rule shown below is a great example of an overall guideline you could follow. The 20/4/10 rule may not work for everyone and that's okay too. Maybe you need a longer term, or maybe you don't have any down payment at all! Don't worry about that, there are car loan options out there for almost everyone.

 

 

Getting Pre-Approved

 

Once you have a budget in mind, it's a good idea to get pre-approved for a car loan. This means a lender will review your finances and tell you how much you can borrow. Getting pre-approved can give you a stronger negotiating position when you're talking to dealerships.

 

 

Car Loan Terms and Interest Rates

 

Car loans come with different terms, typically ranging from 36 to 84 months. A longer loan term means lower monthly payments, but you'll end up paying more in interest over the life of the loan.

 

A shorter loan term means higher monthly payments, but you'll pay less interest overall. Interest rates also vary depending on your credit score and the lender. It's worth shopping around and comparing rates from different lenders to get the best deal. You can learn all about how car loans work by visiting our full guide.

 

 

Credit Score Considerations

 

Your credit score plays a big role in your ability to get approved for a car loan and the interest rate you'll be offered. A higher credit score means you're considered a lower risk, so you'll qualify for better rates. If your credit score is less than ideal, you may still be able to get a loan, but you might have to pay a higher interest rate.

 

Smart Car Buying Tips for Ontarians

 

Alright, you're almost ready to hit the dealership! But before you do, here are a few tips to help you navigate the car buying process like a pro:

 

Test Driving

 

Never buy a car without test driving it first! A test drive gives you a chance to get a feel for the car, see how it handles, and make sure it's comfortable for you. Pay attention to things like:

 

• Visibility: Can you see clearly out of all the windows?
• Comfort: Are the seats comfortable? Is there enough legroom and headroom?
• Handling: Does the car feel responsive? How does it handle bumps and turns?
• Noise: Is the cabin quiet? Or is there a lot of road noise or engine noise?

 

Research and Compare

 

Before you head to the dealership, do your research! There are tons of resources available online to help you compare cars, read reviews, and get pricing information. Some good places to start include:

 

• Kelley Blue Book (KBB): Provides information on car values, pricing, and reviews.
• AutoTrader: A large online marketplace for new and used cars.
• Consumer Reports: Offers unbiased reviews and ratings of cars.

 

Checking Availability

 

It's easy to get your heart set on a specific car, but before you get too attached, make sure it's actually available. Car inventory can change quickly, so it's always a good idea to check with the dealership before you make a special trip.8. Conclusion: Your Ontario Car Buying Journey Starts Here

 

So, there you have it! You've explored the pros and cons of new vs. used cars, crunched the numbers, considered your wants and needs, and learned some savvy car buying tips. Now, it's time to make a decision.

 

But remember, there's no one-size-fits-all answer. The best choice for you depends on your individual circumstances, budget, and preferences.

 

If you're still feeling unsure, don't worry! Our team at Car Nation Canada is here to help. We're passionate about cars, and we're committed to helping you find the perfect vehicle to fit your lifestyle and budget. Contact us here with any questions, and fill in the form below to get pre approved and take your first step towards card ownership!

 

If you're ready for a car loan in Southern Ontario, we'd love to help! simply fill in the form below to get started.