The Ultimate Guide to Buying a Used Car in New Zealand (2024)

Trade Me's Value My Car

BestCar

​MoneyHub's Top Car Finance Options- Avoid high interest rates and fees with our trusted lenders.

• Ourcar finance comparisonresearchhighlighted threeleading car finance companies thatreliably and consistently offer fair interest rates to most borrowers and areactive lenders.
• We suggest contacting dedicated car loan specialist Simplify- their team has a proven track record of offering market-leading interest rates and terms.
• Low-fee personal lenderssuch asHarmoneyoffer car lending and offers a100% online application processs.
• We also suggest contacting car-focused lenders likeMTF Finance- MTF offers branch-based lending in locations all over New Zealand.
• The more you compare,the better your chances of finding the best deal and financing your car for the lowest price.
• Remember, the interest rate you agree to now makes a huge difference when you repay your car loan week after week.
• Signing up for finance with a car salesperson is unlikely to be the best or most cost-effective option.
• ​Advertising Disclosure:We may receive a commission if you take out a loan, but this does not influence our shortlist. Interest rates vary based on each borrower.

Simplify

Harmoney

MTF Finance

One-year-old cars are SO MUCH cheaper than new cars

The easiest way to prove this is with an example Let's take a 2017 Toyota Corolla GX, which lists for around $31,000 new. By the time it's one year old with 10,000-15,000 KMs on the odometer, it costs around $20,000-$22,000, a reduction of 35% in 12 months. This is called depreciation, and while it’s fairly steep in year one, it tails off every year as the car ages. Most Japanese and Korean manufacturers follow this rule. A 2015 and 2014Toyota Corolla GX can be picked up for around $18,000 and $14,000 respectively, meaning you'll often be able to pay 50% of the new model price for a four-year-old model.

Top Tip

• If you want a new(ish) car but don't want to top dollar, selecting a year-old car will slash you BIG on upfront cost.
• This applies to luxury manufacturers (Mercedes, BMW and Porsche) as well, although over time these tend to keep more of their value compared to their Japanese counterparts.

A reliable guide to New Zealand’s cheapest (and safest) cars to run is available for free

The government’s RightCar site has done extensive research, making available free of charge running costs for many models. You can look up 500+ makes and models and get their safety rating and expected fuel cost per year.
​
Generally, these rules apply to running costs:

• ​Smaller engines are cheaper to run as they use less fuel. Smaller engines put out less power, but if fuel savings is your goal, engine size needs to be considered. However, small engines are most efficient for town use and highly inefficient travelling long distances at high speeds, so you need toconsider the purpose of the car, who will use it and how it will be used.
• Petrol carsare usuallycheaper to buy than diesel equivalents,and you won't need to pay Road User Charges (currently $62 per 1,000 kilometresdriven).Diesel engines tend to use less fuel than the same petrol model, and more economical than their petrol counterparts as a result.Diesel tends to cost 70% per litre on what you would pay for 91 unleaded.
• Manual gear cars are much cheaper than automatics. The extra work to save yourself changing gears may be worth the extra cost upfront to make driving a little easier, especially if you drive on busy roads.For example, a manual 2008 Toyota Yaris 1.5L costs $7,500, whereas the automatic version is $9,000, a premium of $1,500. Generally, automatics cars are known to be more fuel-efficient than themanuals as the car knows the most suitable gear to drive in. This fuel saving could be recouped over time.
• Electric and Hybrid cars are much cheaper to run, but they cost a lot more to buy upfront. However as more of them enter the New Zealand market, sticker prices are expected to fall. There will also soon be a resale market - right now they're too new for us to compare to petrol and diesel cars.

Car Insurance Costs

What you pay for car insurance depends on your car and your driving history. If you want to spend as little as possible every year on insurance, a popular vehicle with cheap parts will be less expensive to insure than buying a luxury 4X4. Furthermore, a small European car will usually be more expensive to insure than a bigger Japanese car because of costs to repair and parts. Age and size also factor in - a new small car would be more costly to repair than an older wagon or SUV-type vehicle.

Read ourcar insurance guide for more details.

Know the BEST TIME to buy a used car

Having decided what car you’re going to buy, it’s time to get to get the best deal. There is a ‘right time’ to buy a car if you’re buying from a dealer. As car salespeople have sales targets to reach and bonuses to aim for, you’re best to aim for the end of the month. Better yet, at the end of the quarter (we recommend mid-March, June, September and December) dealers will want to maximise sales and move cars. To boost sales, dealers will be more obliging when it comes to negotiating the price and freebies. A quiet dealership is even better – if you can visit on a Monday or Tuesday. You can negotiate far better than if it’s a weekend after payday and the car yard is filled with half the city.

This advice only applies to dealers. Private sellers don’t care about the time of the month – they just want the best price. However, you will likely have better chances to negotiate in January when many potential buyers are away for Christmas holidays and Kiwis tend to be less flush with money.​

Follow our checklist and ask yourself, what car do I really need?

Buying a car is often more about what youneed, not what youwant. A petrol eating 4x4 may be great for the occasional weekend adventure, but if you’re commuting for hours every week, it’s going to kill you on petrol.

1. What ultimately is the purpose of the car?
   Are you buying your car for family use, a local run-about or do you want a car comfortable for long distances for work purposes? Or something else?
2. Where do I park?
   Do you have a garage or do you park on the road? If you park offsite at night, having a flash car may give you anxiety.
3. Do I need the car for a specific purpose?
   For example, towing a trailer, transporting golf clubs, making a school run with kids and their sports equipment, etc.
4. Do you drive around town, or around the country?
   A small car might not be suitable for cross-country work trips. Having cruise control may be helpful for long drives.
5. Do I want petrol or diesel...or electric?
   The fuel you want to use can make a big difference in the model you might choose.

Planning to get rid of your current car? Should you sell it privately or take it to a dealer?

​If you plan to sell your current car, you have two options –sell it to a dealerorsell it privately. Selling it to a dealer is very easy – just drive it over and agree on a price. You can also trade it in, whereby the amount agreed is knocked off the price of the car you’re buying. Alternatively, you can sell privately – this involves advertising the car, responding to enquiries and agreeing on a price with the buyer.

Option 1 - Selling to a Dealer
Selling to a dealer, whether it be a local dealership or “We Buy Any Car” type business will save a lot of time, hassle and negotiation with potential buyers – but it’s

to give you the best price. Remember, the dealership wants to sell your car to someone else as soon as possible for maximum profit so they’re not going to offer you what you can get from a private buyer. If your car is worth less than $1,000, it may be worth using it as a trade-in to avoid days and nights spent with potential buyers.

Option 2 - Selling it Privately
If you chose to sell privately, be prepared to invest the time knowing you’re more than likely to get a higher price for the car if you advertise and market it right. Recommended options for selling a car:

• Autotrader- $39to $59until sold
• Trade Me-$39-$59 until sold
• AA- free to list
• Driven-$20 until sold
• Facebook
• Taking out a local newspaper classified

Remember, listing a car online is the easy part. Making time for all of the interest parties, scheduling test drives, dealing with the sale and answering a whole lot of questions is the hard part. But, the AA confirms that in nearly every case, theamount of money you would receive when trading a car in will be significantly less than what you would receive from a private sale.

When is it best to trade in your old car?

1. If you are time poor and won't be able to invest the time in selling your car privatelyand/or
2. If your car is in poor condition,low demand, and/or has highmileage - what you'll get for it isn't probably worth the time and effort to sell it privately. Sometimes it's just cheaper to dispose of it for a nominal price. ​

Understand ALL of the costs of a new car

There are two types of costs involved in buying a car –upfrontandongoing.Upfront is simply the purchase price, ongoing is everything else – from WOFs to insurance to parking fees.

Before you add up the costs of your new car, you’ll need to pick the car you want. Start as you would with any major purchase, and look at reviews:

• ​AA Car reviews
• Driven car reviews
• Autocar reviews
• Top Gear car reviews(best overseas website)​ ​​

Ongoing Costs
​There are many ongoing costs with a car, and all fall due at different times. You’ll need to have the money to pay them to keep your car on the road.

1. Finance repayments – if you’ve decided to take out a loan or go with financing, you will need to budget for repayments. Visit our best car finance pagefor our guide to saving on car financing.
2. Fuel -Rightcar.govt.nzoutlines a good estimate of what fuel your car consumes and what that costs over a year.
3. Vehicle License Fee – currently around $52 a year for standard cars. Visit theNZTAwebsite forall the details.
4. Car insurance – your insurance cost is calculated on your risk profile -read our car insurance guidefor more details.
5. AA membership – if you want to join the AA for breakdown assistance and membership benefits such as loans and inspections, factor this in – it’s $79-$89 per year in the first year. Visit theAA Membershippage for all the details.
6. Warrant of Fitness (WOF) – every car first registered anywhere in the world on or after 1 January 2000 will need to have an annual warrant of fitness – this costs around $40-$60 and any failures will need to be fixed. This includes things like brake pads, worn wheels, broken seatbelts etc.
7. Servicing – an optional expense, but worth it if you want to keep your car in good health. You can save money with an AA membership which includes two “16point tests” (cambelt, washers & wipers, coolant level and battery etc.) per year.Non-AA Members can get an AA Safety Check for $19.
8. Parking – if you live in an apartment complex, check to see if you have a parking space. Unless you’ve never owned a car before, you'll know that parking costs rangefrom free (supermarkets) to expensive (airports, inner-city peak carparks).
9. Maintenance and repairs – new tyres, dint and ding repairs and car washing can blow out your budget, so allow for these extras.
10. Diesel Cars surcharge – diesel is much cheaper than petrol at the pump, but there is a $62 per 1000km road user charge on diesel. This means that if you drive your car 5000km a year, you’ll be paying an additional $310 per year.

Trade Me's Value My Car

BestCar

​MoneyHub's Top Car Finance Options- Avoid high interest rates and fees with our trusted lenders.

• Ourcar finance comparisonresearchhighlighted threeleading car finance companies thatreliably and consistently offer fair interest rates to most borrowers and areactive lenders.
• We suggest contacting dedicated car loan specialist Simplify- their team has a proven track record of offering market-leading interest rates and terms.
• Low-fee personal lenderssuch asHarmoneyoffer car lending and offers a100% online application processs.
• We also suggest contacting car-focused lenders likeMTF Finance- MTF offers branch-based lending in locations all over New Zealand.
• The more you compare,the better your chances of finding the best deal and financing your car for the lowest price.
• Remember, the interest rate you agree to now makes a huge difference when you repay your car loan week after week.
• Signing up for finance with a car salesperson is unlikely to be the best or most cost-effective option.
• ​Advertising Disclosure:We may receive a commission if you take out a loan, but this does not influence our shortlist. Interest rates vary based on each borrower.

Simplify

Harmoney

MTF Finance

Trade Me's Value My Car

BestCar

Pre Inspection Essentials

1. ​Get the description in writing -the seller MUST present an accurate description of the vehicle. Take screenshots of the advert, and if you get more details over the phone, ask them to confirm those on an email. It’s all about making sure there is no bait and switch or catfishing going on.
2. Research the seller– if it’s a Trade Me listing, look who the seller actually is – how many negative reviews do they have, and how have they responded? Are they a new seller? That could be a red flag. Verified sellers are preferred, as are ones with a positive Trade Me seller history.
3. Don’t meet up at a neutral location– make sure you go to the seller’s home to view the car. Meeting at a carpark etc. screams dodgy, and suggests they don’t want buyers to know where they live in casesomething goes wrong.
4. Call in a friend– having a second opinion is essential. Bring a family member, friend or workmate who knows something about cars – they don’t need to be an expert, just someone with some common sense.
5. Check the Car’s History -this gives peace of mind and exposes the vehicles’ dirty secrets (should it have any). For $, it’s worth the money and could save you bigtime later on should there be something dodgy the seller didn’t tell you.

MoneyHub reader Steve writes:
"I read about a late model VW going for a good price, but there weren’t many photos. I phoned up the seller, and he was vague but made an appointment to look at it anyway. It really was a bomb, and I only got through a few of my checklist points before calling it a day. The seller was a Catfish, listing a dodgy car with no hope of selling to anyone informed”.

Know what CAN go wrong, so you can ensure it doesn't

​​There are several risks with buying a car privately. We outline them:

1. The car has finance owing on it– this means that the seller doesn’t have the authority to sell it and it can be repossessed at any moment.
2. The odometer is dodgy– this can be aproblem throughout New Zealand, and itmeans you are buying a car that has done more kilometres than it says it has.
3. The car is stolen–if you buy a stolen car,it can be taken off you at any moment and you could be charged with receiving stolen property. To eliminate this risk, always verify the ownership details and history before purchasing.
4. It’s a total lemon– the car has major problems and is unusable.
5. The car is a ripoff– it’s not always so clear what a car should cost. You do risk paying too much.

Get the car's complete history for a small fee

A car history check will tell you if the vehicle has money owing, an inconsistent odometer, has been reported stolen and offers a number of other useful information points. It will also tell you the current legal owner so you can be certain you are dealing with the correct person. Car history checks can be bought instantly online.
​
Recommended:carjam.co.nz is arguably the leader in car information, selling their detailed CarJam report for around $15 – you can see a sample report here.This comprehensive report will let you know everything about the car like accidents and ownership changes, WOF issues, money owed and a market valuation. Keep in mind the report isn’t a vehicle inspection – we outline these separate reports further below. Our CarJam Review and CarJam vs MotorWeb Reports guides have more detail.

Stolen car?If you only want to know if it’s stolen, enter the registration on the NZ Police website to check it's status.

Money owing?TEXTB4UBUY is a government service that checks if there is money owing on the car. It costs $2.30 per registration number.

Get familiar with MR13 forms (used to buy a motor vehicle)- you can complete the MR13 formsat your local PostShop or AA centre.

Once you confirm everything is above board and who you are dealing with actually owns the car, you may want to organise a vehicle inspection.​​

Test Drive Essentials

We've listed a few suggested essentials to help you see the car as it is, not how the seller wants it to appear.

1. ​​Ask if the vehicle can be cold on arrival -you will be able to feel how easy the car is to start, as well as hear any rattles or problems with the ignition process. You may also notice smoke until the engine warms up (although quite rare), so having the car cold is the best representation of its condition. It gets cold in winter (even in Auckland), so a car that starts easily is a lot less hassle.
2. Never view a car in the dark, and preferably not in the rain– you want to be able to see everything and feel everything without the distraction of darkness and weather conditions.
3. Ask for the vehicle to be parked on concrete –you’ll be able to see if there are any oil leaks.
4. Ask for cambelt history – a car doing over 100,000KMs will need a new cambelt, so ask for proof it has been done.
5. Check the battery life – make a note so you know how long it has left.
6. Google things to watch out for with that particular vehicle and engine too.
   Check to see if it's subject to the Takata airbag recall,and if it is, check to see if it has been recalled.
7. Don’t point out every flaw, scratch, dint or otherimperfection- you’llinsult the seller who will be much less receptive to negotiatingon price later on. Just make a note of it mentally and use it how you wish with the negotiating.
8. Test Drive by riding Shotgun– knowing how the car drives is easier learned as a passenger. Ask the owner to drive you out to a specific location and plant your feet on the floor. Feel vibrations, listen to how the car sounds and takes corners. Any misalignment or out of balance wheel will be obvious when you’re riding in the passenger seat. You’ll also be able to identify any suspension problems.
9. Assess the seller’s driving– the last thing you want is to buy a car from a hoon. Aggressive drivers brake and accelerate without care, wearing out the car. Ask yourself:

Does the owner:

1. Accelerate too aggressively– this causes the engine to get prematurely tired.
2. Brake at the last moment- the brakes could be worn out.
3. Take corners sharply– tyre tread can unevenly wear out meaning a WOF will be harder to get.
4. Ride the clutch– this wears out the clutch one coasting at a time.
5. Drives over potholes– this wears out the shock absorbers, affects the alignment and damages the suspension. Or are they a calm driver who shifts gears smoothly, avoid potholes and keeps inside their lane and drives defensively? The condition of a car is directly related to how it’s driven, so you may want to say no to the seller if you feel as if you’re joyriding with a boy racer. The rule is to make sure your seller is a good driver.
6. Drive the vehicle– invest the time totest the car properly. Specifically:

• Accelerateup to 100km/h and then bring it up to 120km/h (momentarily) to make sure it doesn’t shake, rattle or wobble.
• When at cruise speed, take corners to detect anymisalignmentor corrections you need to make
• Brake consistently for half the way to check the engine brakes are working properly. If it’s an automatic, turn off OverDrive to ensure the vehicle naturally engine brakes. With a manual, engine brake by taking your foot off the accelerator.
• If it’s a front wheel drive, find a location to perform a sharp right and left turnto testthe steering wheel and handling; you'll soon see if there are any locking up problems.
• Find a quiet road with a clean, new surface. Listen to the car andto the wheels;any rattling will be easily heard.
• Test the clutch: Leave the handbrake on and put it into first gear, slowly releasing the clutch. It should stall quickly – how does the clutch feel? It should feel natural and not slip.

Minor checks:

• Check tyre wear for even wear across the tread
• Check pedal rubbers – if you see extensive wear, this will suggest the owner is a brake rider and there may be worn out brake pads. ​

If you like the car after the test drive, consider getting a Pre-Purchase Vehicle Inspection

​It’s unlikely you’re a mechanic, so for complete peace of mind, it may be an idea to get the vehicle checked out by the AA or a local mechanic. It’s more expensive than a WOF, but it will protect you from being ripped off.​

AA Pre-Purchase Vehicle Inspections
​The AA offer pre-purchase vehicle inspections that offer a comprehensive 100+ point vehicle check by an experienced mechanic, an overview of any recommended repairs, an indication of any potential WoF issues and clarity around the condition of the car before you buy it. The cost is $149 (members) and $169 (non-members). You will be hard-pressed to find an assessment that is as thorough, and the AA report gives reassurance that you can buy your car with confidence.Alternatively, you can also contact a local mechanic who can perform an inspection.
​

Trade Me's Value My Car

BestCar

​MoneyHub's Top Car Finance Options- Avoid high interest rates and fees with our trusted lenders.

• Ourcar finance comparisonresearchhighlighted threeleading car finance companies thatreliably and consistently offer fair interest rates to most borrowers and areactive lenders.
• We suggest contacting dedicated car loan specialist Simplify- their team has a proven track record of offering market-leading interest rates and terms.
• Low-fee personal lenderssuch asHarmoneyoffer car lending and offers a100% online application processs.
• We also suggest contacting car-focused lenders likeMTF Finance- MTF offers branch-based lending in locations all over New Zealand.
• The more you compare,the better your chances of finding the best deal and financing your car for the lowest price.
• Remember, the interest rate you agree to now makes a huge difference when you repay your car loan week after week.
• Signing up for finance with a car salesperson is unlikely to be the best or most cost-effective option.
• ​Advertising Disclosure:We may receive a commission if you take out a loan, but this does not influence our shortlist. Interest rates vary based on each borrower.

Simplify

Harmoney

MTF Finance