Top 10 Tips for Used Car Buyers in Australia | Auto Expert John Cadogan

Top 10 Tips for Used Car Buyers in Australia | Auto Expert John Cadogan


Buying a used car is more complex than most
people think. Here’s how to sidestep the lemons, dodge the dogs and otherwise stack
the deck in your favour. I’m John Cadogan from AutoExpert.com.au
– the place where Aussie new car buyers save thousands off their next new cars. Hit me
up on the website for that. More than one in every four used cars sold
in Australia hides a potential problem. There are nearly 4.3 million vehicles listed on
the official Personal Property Securities Register (where the vehicle forms the security
over someone’s loan). The average cost of owning a lemon is up to $2000. Ouch.
If you’re in the market for a used car, here’s how to stack the deck in your favour
and avoid an administrative and/or financial disaster.
In the spirit of full disclosure: This report was sponsored by CarHistory.com.au
I’ve been recommending them for years. They’ve been kind enough to support the production
of this used car buyer protection series. But the words and opinion here are my own
– this is not a paid advertisement. CarHistory offers a simple, online report
that takes just a few minutes and it costs less than $40. That’s basically all it takes
to step out of the administrative minefield and drive off in a high quality used car that
you’re certain is not a lemon. The CarHistory check even comes with a vehicle buyback insurance
guarantee that essentially takes risk right off the table.
For more detail on protecting your own best interests, visit carhistory.com.au/AutoExpert
If you visit that dedicated AutoExpert landing page you’ll save 20% at CarHistory.com.au
between now and 31st December 2017. You might as well tell your friends; they can save too.
There are three major administrative speed humps on the road to avoiding a lemon. The
car could be stolen, it could be a repaired write-off being sold under the radar, or it
could be the security on someone’s loan. Izzy Silva is the General Manager of Consumer
and Digital Marketing at CarHistory. Just to give you some flavour of how Australians
research for cars, they spend nearly seven months researching for a holiday, but they
spend 1-2 hours researching for a used car. A massive difference. A holiday is a week
or two, a car is a lifetime investment potentially handing it down to your kids or family so
when you consider those facts, consumers should spend a bit more time and effort researching
a car. And as you mentioned, CarHistory.com.au is a comprehensive automotive bureau, so we
provide the facts behind the vehicle. Bear in mind that looks can be deceiving – a
great-looking car being sold by an apparently fine, upstanding seller can still be a lemon
in one (or all) of these ways. And, if it is, this will be a disaster for you.
The simple message here is: You can choose the vehicle with your heart, if that’s how
you roll, but you have to buy it with your head.
If the car has been stolen, or if the VIN code (that would be the car’s unique 17-digit
alphanumeric serial number) does not match the engine number, rego number or information
on the vehicle’s rego papers, these things are major red flags.
Sometimes there’s a good reason for a mis-match. A different engine number might mean, for
example, that the engine was replaced under warranty because of a manufacturing defect.
However, in any of these cases where a mis-match is flagged, significant further investigation
is required. Do not buy the vehicle until its status is adequately resolved.
The easiest way to validate the VIN code and rego number, as well as get information on
the vehicle’s previous sales history, evidence of odometer wind-back, rego status, safety
rating and emissions, is at carhistory.com.au Repaired write-offs are a major pitfall. Vehicles
in this category are often sold to unwitting buyers as if they have not previously been
written off. And if you purchase such a vehicle it can be an administrative, as well as financial,
nightmare. The research that we conducted at Carhistory.com.au
showed that over 10 per cent of cars that went through a carhistory report last year
in 2016 had a written-off status. Which is a big number, considering most people don’t
even do one of these checks, so … one in four cars that went through a carhistory report
check last year had a problem – encumberance or money owing being the biggest, closely
followed by repairable write-offs. In some states, like NSW, repaired write-offs
cannot be registered. Even if you live somewhere this is not a problem, a repaired write-off
is always worth far less than an equivalent car that has not previously been written off.
In general, factory warranties are cancelled if the vehicle is written off, and the vehicle’s
insurance status changes as well. So in many ways, a repaired write-off is significantly
less car than you may have been expecting. The CarHistory report neatly avoids the extreme
headache of unwittingly buying a repaired write-off. And if you do buy one of these
repaired write-offs, at least you know what you’re getting, up front. It also details
the vehicle’s insurance claims history. With 4.3 million vehicles listed on the Personal
Property Securities Register (the PPSR – formerly known as ‘REVS’) there’s a significant
risk, if buying privately, that you could end up with a vehicle that forms the security
on the previous owner’s loan. (This is known in the business as an encumbered vehicle.)
This is a disaster – for you. If the previous owner defaults on the loan, the financier
will repossess your car, and there’s essentially very little that you can do about it.
CarHistory also tells you if the vehicle is encumbered, and if it is: get expert advice
from your solicitor or accountant about how to discharge the encumbrance in the course
of buying the vehicle. If the vehicle you’re looking at passes
the administrative health checks at CarHistory it’s time to get your trusted mechanic (or
the motorists’ association in your state – NRMA, RACV, RACQ, etc.) to give that vehicle
a thorough physical. An independent expert can easily assess the
vehicle for physical red flags – evidence of abuse or imminent failure that might cost
you thousands of dollars to repair. And they can also review the vehicle’s service history
(and bear in mind that ongoing factory warranty coverage depends upon the vehicle being properly
serviced). And finally, an independent expert can assess
the vehicle for evidence of dodgy crash repair – perhaps from a repair that did not involve
an insurance claim. If anything is flagged at this point, you
might choose to walk away from the vehicle and buy one in better order instead, or use
the defect as a bargaining tool to negotiate the price down. That often works surprisingly
effectively. Some people know exactly what they want, and
most people have some idea. It might be a sedan, hatchback, SUV, ute, sports car, whatever.
However, the market is drowning in choice, and it is often difficult for a non-car person
to get down to a viable short-list, using rational criteria.
In general, you’re looking for the newest example of the kind of car you want, with
the fewest kilometres on the odometer – balanced up against what you can afford to spend.
There are some important considerations to help you refine your choice.
Safety is a tremendously complex issue. You’ve got so-called ‘active’ safety systems
(crash avoidance technology) and also ‘passive’ safety systems (which are designed to protect
you during a crash). Active safety includes things like stability control and ABS, while
passive safety includes crumple zones, airbags and seatbelt pre-tensioners. Things like that.
All of these things matter. Thankfully, however, this complex issue is made digestible thanks
to ANCAP, the Australasian New Car Assessment Programme. The bottom line – aim for a five-star
safety rating if you possibly can. Most vehicle categories have been more than adequately
served with a range of five-star vehicles for more than 10 years now.
Choosing a five-star car maximises your chance of not becoming a grim statistic if you crash.
The CarHistory report also includes information on the vehicle’s safety rating.
Cars cost money to own and run – it’s that simple. It’s easy to assess the likely fuel
economy of any car on your short list at the Federal Government’s GreenVehicleGuide.
You’ll get official fuel consumption and CO2 emission data, as well as estimated annual
fuel cost. (Just bear in mind that these numbers are
based on official lab tests, and real world consumption for most people is typically about
20-25% higher than the lab test numbers suggest.) Check the service interval, too. Some brands
(like Toyota and many Subarus in the used market) demand servicing every six months
or 10,000km while other brands (like Hyundai and Kia) have moved to 12 months or 15,000km.
If you’re a low-mileage driver annually, it could easily cost you twice as much to
service a vehicle with a six-month maximum service interval.
(And bear in mind that servicing is based on time or distance – whichever occurs first.)
CarHistory also includes information on the vehicle’s fuel economy and emissions.
Insurance costs can vary widely between different vehicles and different drivers. It’s a disaster
to buy the ‘car of your dreams’ only to discover you can’t afford to insure it. Always
get quotes before you buy, right, to avoid this pitfall.
Most people use online classifieds to do their ballpark pricing research. I prefer Red Book
– research is free (if you use the ‘research’ tab) and you get both trade-in and private
sale price estimates. Just bear in mind that Red Book’s price estimates are often a little
optimistic, and actual transaction prices are often a little lower than Red Book suggests.
Interest rates on car finance vary widely across the market, and you owe it to yourself
to shop around, because considerable savings are often available, and this can boost your
buying power significantly. Do not just blindly accept the dealer’s first offer, or the
bank’s – you’ve got to shop around. Ultimately the rate you pay depends on the
financier’s risk assessment of you. Clients, generally, with good jobs, strong credit ratings,
and asset backing – they tend to enjoy the lowest rates, and clients with poor references
here tend to pay much higher ratest. Lastly, remember that trade-ins are all about
convenience – they’re a quick, easy way to dispose of your old car. A trade-in will never
yield the highest return on you old car. If you want to maximise the return, sell your
old car privately. Just bear in mind that this can be frustrating and time-consuming
as well, and you’ll have to negotiate face-to-face with the buyer, which many people, frankly,
do not enjoy. I hope this helps you avoid parking a lemon
in your driveway – plenty of people get themselves in that position, but you don’t have to
be one of them. I’m John Cadogan. Thanks for watching.

About the Author: Michael Flood

100 Comments

  1. Does the $40 get you anything significantly more than the $3.40 PPSR report on PPSR.gov.au?
    Is it 'just' that vehicle buyback insurance you mentioned at the start?

  2. This is very timely for me. I've been looking for a used car for the past month. I have two to look at today. Thanks for posting this video. Cheers from Melbourne. 🙂

  3. A New car is not in the buyers interest , It is for the companys sake , New cars are NOT to be a Classic . They are to be DISPOSED of like your smartphone

  4. The other thing to think about (that John didn't really mention) is the servicing and repair costs (he touched on service interval but the actual costs of the service are a factor as well). In general, the servicing and repair costs on most European cars (e.g. VW, Audi, Skoda, BMW, Mercedes, Mini) available at a given price point will be higher than the servicing and repair costs on cars from the Japanese or Korean manufacturers (e.g. Toyota, Nissan, Hyundai, Kia, Mitsubishi, Subaru, Suzuki, Honda, Lexus).

    I see people all the time on car forums looking at something like an older base model no-options BMW 3 series or some other European car for sale at $10k or $15k or something and thinking its a good purchase when that same money could get you into something much more reliable from the Japanese and Korean brands.

  5. Finally some used car advice. Have been waiting for this video forever. Good stuff John. Hope to hear some more advice on good used car brands and so on since quality varies a lot from brand to brand throughout time. The fact that a 10 year old Kia is usually an unsafe shitbox for example.

  6. I bought a mitsubishi lancer 2008 lancer vrx, 6 month later i found out it was in front end collision and had be repainted and parts were replaced cheaply. Pretty sure it must of been a write off aswell. Biggest mistake of my life. Broke my heart when I found out.

  7. Thankyou for giving me a list of items to look for if I decide to purchase another car, and supplying "carhistory.com.au" information. I didn't know they existed. Thankyou.

  8. i've spend the last 2 weeks binge watching all the videos in your channel as a preparation for buying a new used car. I must say you talked me out of buying a Craptiva and a Ford. This video is exactly what I was looking for

  9. Just hate purchasing any vehicle. That's why I still have my Dodge P/U and Camaro. Neither owes me a $1 and I owe nothing on them. Car history worth every $$$.
    My wife bought a used 2010 Altima from a Canadian govt. online auction. Was a former departmental vehicle in excellent condition and needed nothing, cost nothing to certify. 75,000km later and only a set of tires and front brake pads and rotors. Total cost including taxes was half of what a dealerships sticker price is. I asked what department it came from and was quite satisfied. You do not want X police vehicles or military ones as they are never registered and usually show far too few km's for the condition the vehicle is in. many vehicles are listed every day, occasionally a seized vehicle such as a Porsche, but most appear rough.
    Walk away from any vehicle that's been in a major crash. Remember millions of a particular model in your colour is made every year, Nothing is RARE !!.
    John mentions safety ratings by the stars.
    I take into account weight, size and height, basic physics tells me a larger vehicle is safer, all other things being equal.
    Bigger the better, remember your loved one is the one you are protecting so spend the extra $$ bit on fuel if need be.
    Vehicles that use more fuel typically cost less when used.
    Trade ins are a rip off, you get 2x scrap value at best, sell it private and make a first time buyer happy with the price and knowing you ensured that the safety items are in good shape.

  10. John how many 000's before the decimal point on the UTube cheques do you get a month? So much time spent researching and recording must be worth a decent $$ since your subscribers are 108K and you get many likes.
    SHOULD get more LIKES in comparison to the VIEWS, do your viewers just forget to click in LIKE???

  11. my opinion, if buying a cheap 1k-2k etc clonker, checkvin does ppsr "stolen,encumbrance,written off report" for 9.90 and takes paypal and so easy to look up on mobile while checking physical vin numbers on car vs rego papers "nsw", if buying a 10-30k car man spend the dollars and get a deeper history+workshop check, it is so to speak peanuts compared to price of car.
    dont let the thugs win and rob you of your hard earnt money.

  12. The information in this video works in the USA too. Just a couple of minor differences.

    I watch this channel, Steve Lehto's channel and Autoextremist dot com (Peter DeLorenzo) to get the un-BS info about the car industry. All three might be considered the Evil Three by the car industry. John, you're in good company!

  13. Years ago I bought an old Volvo, the type with the side lights permanently illuminated, boxy (mostly hated) this was the best car I ever owned, easy to maintain, it drove like a champion and it cost me $1,000, i wish i still had it.

  14. I have a 2002 Corolla, I service myself, with cheap 3rd party property insurance and cheap on petrol. Gives me a much higher disposable income to travel and see the world.

  15. i'm just going through the headache of private sellers and dealers over inflating the asking price then producing a lemon that doesn't represent the price and not willing to budge. just came back from a stealership in tweed heads thinking i was born yesterday.

  16. The bit about not trusting the database and having someone who's eyes are connected to their brain look at the vehicle is crucial. I nearly bought a former lease car which had been involved in a serious accident before being repaired by the lease company's in house bodyshop and sold by one of their employees as a 'private sale' to keep it from flagging as damaged and maximise their return whilst managing their risk. I rang the database company and asked them to put a condition check warning on the vehicle. If you find a car and the paperwork is clean, but it looks wrong, walk away. Better yet, run. The factories are still making them at a hell of a rate, so there's a big pool to go fishing in.

  17. We had a work car (Nissan Pulsar), encumbered at $15k and 14 years old. Was bought by an employee who abandoned it for 7 years. So we got it going and used it as a hack, charging the lender storage as it was parked for 12 years in our shed. They never came to claim it. A guy at work wanted to buy it but we warned him off as he could loose his $1.5k if the bank claimed it.

  18. Go for Ssangyong and smile for ever, also in Game of Thrones there are 2 dragons, that's the sign that tells you is the year of the Double Dragon = SsangYong!!

  19. uploading this a week before i come to australia and probably buy a car there is a pretty neat coincidence
    or it isnt and youve been stalking me

  20. Doesn't do much for older cars. Tried 1990 and 1985 cars, and they contained no more information than an RTA check could do for less money.

    But I agree. Used cars can be problematic.
    They're a bit like rescue dogs: there's something wrong with it, which is the reason they're for sale, and it may take a while, but eventually a nasty trait/problem will surface.

  21. Tip #11: Don't buy a convertable in the spring or summer. The price will be lowest in the fall.
    Tip #12: Don't lease or finance a car — ever. If you can't pay for it upfront with cash, you can't afford the car.
    Tip #13: Never buy the first model year of any new version of a car.

  22. Hi John, when selling a used car, what is generally the accepted practice for accepting payment in return for handing over the keys. I am in the process of selling a used car and my view is that if the buyer is not prepared to pay cash (and I'm talking in the order of $20K), then they should accept that if they are paying by bank cheque or EFT, the keys don't get handed over until the payment clears in my account. If that takes 24 to 48 hrs, then so be it. I can't imagine that it is generally acceptable that the seller hands over the keys and watches the buyer drive away in their car while waiting for the funds to clear. Your thoughts would be appreciated. Thanks.

  23. 5-star safety or bust sounds good in theory, but it really does depend on your budget and how old it forces you to go. My sister was shopping for a used car recently, and I'm not exaggerating when I say that it was near impossible to find cars within her strained 6k budget that had good safety ratings AND a decent reliability record. It was basically a matter of Affordable, Safe, Reliable – pick two.

    If you can afford a near-new used car (3 years or so), then it's not such a problem, but everything on my sister's shortlist was over 10 years old, and at that age you can forget about small cars entirely if safety is a priority. Even many larger cars (like the Camry, Falcon, and Commodore) were only rated 4/5 by ANCAP at the time.

  24. You have to look out for flooded cars now as Houston and Florida has been flooded. I live up 90 miles or so from NYC. I saved up to buy a car or a newer car . I found a car lot and found a 2017 Mazda Cx-9 with 120 miles on it. I gave to guy 50.00 to hold it as I had to wait for my disability check to add to the money I saved up. I am a disabled vet so I saved up for 3 years. The Mazda was 25k whereas a brand new one was 43k so I thought I was getting a great deal . I went down 4 days later and the lot was empty . I checked with the police and found out the cars had been flooded damaged from Houston and there looking for the guy now. He sold all 30 cars on his lot and now they're having all kinds of problems I am glad I only lost 50.00 bucks I also found out the cars had salvage titles that had been retitle in PA as clean titles
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  25. active safety on my list only includes the driver (me) and ABS. I never wanted more….I mean the LSD is also listed as a safety device….it is I guess pretty handy on the racetrack! Nice sum up on how to buy a used car…but if you are a car guy like me choice of cars you are looking into are pretty damn low. I looked for my 25 year old BMW M5 for 2 years until I found the right one. For me first advice to buying a used car: "Take fucking time"

  26. John, It s getting more difficult than ever to purchase a new or used car with all the deceitful con artist and crooks is the marketplace, new or used it is becoming a game and a knowledgeable education of the Automobile industry, it is a good thing that people like you helping the uninformed and uneducated to purchase a car with the assurance and peace of mind.

  27. I used car history when buying my wrx gc8, good piece of mind and extra negotiating information, I'll always use it from now on.

  28. Arrrr ??? John that new ''shortin shitty format'' of yours is a pile of Cow cakes, what are we working you too hard ?, but I must admit youv'e gotta love that roving reporter he's a real funny fucker. You never got a Discount on those 2 new cars of yours??, nor do i recieve any favours or slingbacks for endorsing any of my Wallies that come onto my slick show-room floor??????.

  29. Totally agree with this my car was in accident and then repaired and then writing off it was a Kia Soul looked great only done 11000 km but was faulty in the wiring which would of cost 14000 to fix but QBE fixed it looked great on the out side you would of never know it had faulty wiring until you bought it which happened when they guy that bought it rang me up and I told him the car history he new he’d bought a lemon then tried to sell it to a dealer but he rang me too and I told him it was a write off this guy bought this car a an Auto Auction bad place to buy any car this car should of never been put back on the road it was never fixed properly IT SHOULD OF STAYED A WRITE OFF. But thanks to QBE it was sold on and being written off 👎🏻

  30. Number 3 is a major issue. I've looked at a car to purchase and the previous owner (not the current) still owed money on the car. Part of the payment was going to them to pay off the car. Walked away from that crazy purchase.

  31. how does Carhistory compare to doing a cheap PPSR search? $40 seems a lot compared the $3.40 search you can do easily.

  32. Thanks John, this is great advice. Coming up to the point where our youngest will want a car soon we can't really afford new, these pointers will help us to make an informed decision on a used car.

  33. I bought my 10 year old BMW with a 4 year mechanical warranty. All I need to do is service it regularly and if anything breaks it is paid for, except normal wear and tear items. https://www.facebook.com/BMW330iMSport/

  34. To be honest….I would no longer consider a car a life long investment, the vast majority of cars these days are purely just consumer products, and it frustrates me to no end that I can't purchase one in the same fashion as a TV. I.e not through a dealership….

    The days of getting mum and dad's Kingswood that they purchased new when you were born are long gone….

  35. Carhistory.com.au is only picking the PPSR report from govt site and patch it with car valuation statistics for 36$ which you could do for 3.5$ at the govt site and the statistics that they provide is picked from redbook.com.au. Only extra that carhistory.com.au could offer you is the odometer based fraud which shows only on their sample report. When I tried i got only the first 2 part which I already had availed from PPSR. There were no information on Odometer history or service history. I felt like cheated.

  36. My friend, I can buy a Hyundai or Kia, but chicks only fall for BMW, Audi or Mercs. That s why most guys are buying them, dont care about something else……life is short

  37. Hi John,
    Learning a lot from your videos, thank you. I'm looking at buying a used car – shortlist of Mazda6 wagon or Subaru Liberty. Considering my modest budget, I'm tossing up between a newer car with more kilometres or an older car with fewer. If I'm satisfied that service history has been good and that odometer reading is true, would it stand to reason that a newer car with more kilometres is a better buy (apart from being more up to date) as it has probably done more highway distances, probably less cold starts etc? My wife and I don't drive a lot so the mileage we add to the car annually would be pretty low (5-10k), so by the time we sell the car it would probably have average kilometres. What odometer number on a prospective car should I consider too high to look at? I appreciate you also advising used car buyers.

  38. John..You are a legend.
    Came across your channel last week as i was looking into advise buying a used car. In most of your videos you mention, we help you save thousands of dollars and at first I thought you are just exaggerating. Anyway, I followed your advice/suggestions and bought a car last weekend. Saved almost $7000 over 5 years (finance and price negotiation).
    I was amazed at how much these car dealers can rip off.
    Thanks and God Bless you mate.

  39. People please help me I'm thinking about buying alfa romeo 159 as a first car should I buy it??? Please guide me

  40. i maybe buying a 2007 mazda 3 from a dealer the radio antenna on rear of roof has over spray
    i'm just waiting for the outcome after i get an independent inspection
    if a car is thought of as a life time investment it would have to be the worst investment in history
    as it depreciates

  41. Western Australians, Pls advise me on what a used car I should buy in Western Australia?
    I am moving from Egypt to W.A in a month or less
    My budget is limited though as a kick off
    From 2000 to 4000 AUD

  42. John, when you are doing these kinds of uploads, that you are really doing your best work. Please ditch the nutfests, ( arguing with idiots is wasted effort ), stupid voices, wearing fishnet stockings, having pretend conversations with a sex toy to your ear, and wearing teenage t-shirts – they just don't look good on men of advancing age. Particularly when they really are fair dinkum , straight shooting experts, who deserve having their counsel taken seriously, trusted, and acted on. Thank you for what is excellent advice in this video! 🙂

  43. I need a good Australian contact. Im a car dealer in texas home of rust free cars. I can get you good deals on 70s corvettes whatever you want. I know there has to be alot of trust. I just been a good buyer. I been a mechanic for 10 years so i would only send the best cars. Unless fixer upper is wanted.

  44. It's confusing buying. I've seen these 3 utes online for sale at dealers. A 1992 Mazda Ute with 10,000km or 2012 Great Wall ute with 120,000km or 2002 Toyota Hilux ute with over 200,000km? All for a similar price. Wanting to use for light ute duties and maybe light towing.

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