Getting the right car at the Right Price: Learn about Car Pricing

Every car shopper is usually looking for the best car that will offer good value for money. How do you determine the right price of a car? This is an important question and one every car shopper needs to ask before making any car purchase. Whether you’re looking to buy a car or sell your old car, knowing the right price of the car is quite crucial. This is the only way to get good value for your money.

You will find most people opting to trade their old cars with new models instead of selling them. This is because of the complications that come with selling an old car for cash. The biggest issue is usually coming with the true value of your car.

Understand the market value of your car

The first step is to understand the market value of your car in your country region. If you’re in Australia and looking to buy or sell a ford car model, then search for Australian Ford Prices. This is a great way to get the market value and work down to get the true value of your car.

There are several online tools one can use to learn about the car market prices. However, most of these tools are not 100%. The best thing is that they can give you an estimate from which you can start to value your car. You need to avoid checking for car prices on online classifieds and newspapers where prices are usually competitive. The ads are usually compelling, and you will never know the true condition of such cars.

Define the condition of your car

The second step is determining the condition of your car. This is where most people face challenges because of the attachment they have with the car. You need to be honest with yourself and give a true assessment of your car’s condition. You can also have a friend or a mechanic to check your car and give you a report on its condition.

Category 1

A car in an excellent condition should have the engine running well, and all maintenance records complete. The car’s inside and outside should also be clean without any marks or damage. It should also feature quality tires with most treads on them. The car painting also needs to be free of flaws and excessive chips. A car in such condition will easily pass state-required inspections.

Category 2

We also have average second-hand cars which have consistent wear with age. Such cars don’t have any major mechanical flaws. They also have a good painting with a few scratches. The car’s interior also has a few minor damages that require a few touch-ups before use. In fact, most second-hand cars belong to this average category.

Category 3

We also have cars that require some investment to fix a few problems before use. Such cars feature faded exterior paint, dash, and seats. The car usually needs a lot of reconditioning before you can put it up for sale. A car in this category requires most parts needing replacement before it can pass any state requirement inspection. You can buy a car in this category but one that will cost you more in repairs before hitting the road.

Category 4

The last category is cars we call the salvage cars that are risky to buy. Such cars usually have a big mechanical or body problem. The cars are quite dangerous on the road at any speed and will likely fail any state car inspection. This is a risky purchase as the car will take a huge investment in terms of repairs before they can hit the road again. The car usually features bald tires that are unsafe.

Where does your car lie in these four categories? Being able to define your car’s condition in the four categories above is crucial to determining your car’s price.

Getting the car price differences based on their condition

The price of cars will usually differ greatly based on their condition. Let’s take the example of the 2015 Ford Fiesta with an average of 12, 000 miles on the road. The estimated value of the same car under different conditions in the four categories will be as follows:

Category 1: $ 3,000

Category 2: $ 3, 600

Category 3: $ 4, 200

Category 4: $ 5,000

Well, these are just estimates to show you how greatly the price can vary depending on your car’s condition.  This shows you the importance of keeping your car in a great shape from day one of purchasing.

Three values of used cars

Used cars can be categorized into three values of the trade-in price, the private party price, and the retail price. The first categories are for persons looking to buy a second-hand car. Here is how each category affects the price:

How to value a trade-in: While there is no clear formula of getting the exact value of a used car, objective data can give you a clue of the estimated price. Check for your car prices in the different online dealer offers Edmunds and Kelly Blue Book. Get their prices and divide to come with an average. This will give you the estimated price of your car.

Private party price: This is your best chance of getting a good value for your car as opposed to dealers. However, you have to factor in the time it will take you to get a client willing to meet your price. Setting the private party price requires you to get an estimate of your car from the dealers. You can then add at least 10% of the estimated price. This is because the dealers lower the price by at least 10% to gain a profit when re-selling it. Make sure you have as much information as possible before meeting the client.

Retail price: Most certified car dealers will sell the car at 5%-10% more the price they bought it. The price might go higher if they made repairs to it.

Final verdict

Buying or selling a car is never easy if you don’t understand the price. The first and most important thing when buying a car is getting the price right. Make sure you take the necessary steps and get the true value of the car before engaging in any transaction.

Steven K. Galloway