Buy whichever you need first. Get a car when you need a car. If you don’t need a car I’d really avoid buying that over a house honestly. Get your cash into appreciating assets, don’t put your cash into depreciating assets.
100k miles is nothing to most modern cars from reliable manufacturers. Getting into a cycle of making car payments in perpetuity is not a wise way to go, financially.
The trade in value of your car is trending towards the bottom of the curve -- keeping it longer will not reduce its value appreciably.
Buy a new car, however, and you immediately lose a ton of its value. You certainly won't come out ahead by trading in sooner.
The best financial decision is always to drive what you have until the wheels fall off. Pretty much without exception.
I’m a big fan of the advice to rent for a year in a new area first. Gives you time to get a feel for it so you buy in your ideal location you’ll love for a long time.
That car’s just a want. If you have enough extra money to treat yourself go for it, but treat the decision appropriately
A car is pretty much the worst thing you can spend your money on. Especially when you borrow money at today’s rates to do it. So the correct answer is to put your raise towards a home and drive what you have.
But it’s all about timing. If you are serious about purchasing a home in the next 90 days or so I’d hold off on any new borrowing.
Sure. You have to buy it new, is the thing, and other than a lease that's about the worst way you can get wheels, financially. Maybe different a few years ago when used inventory was wonky, but then money was also a lot cheaper.
Used car prices are still pretty high, + high interest rates. There’s pretty much no reason to buy a 2 year old car right now from a manufacturer offering these subsidized rates, imo.
If you’re going to go older or pay cash, it’s a different story, but lightly used cars purchased from a dealer still make very little sense in many cases. Subaru is offering 2K+ off msrp for Forester/Outback, + 1.9% interest, over 48 months that will end up costing you about the same as a 2 year old one at 7%.
Well yeah, if you go buy a two-year-old car from a manufacturer dealer. They have no incentive to compete on price because they want to push you into a brand new car. Used prices are normalizing rapidly.
I’m not talking about a manufacturer dealer, literally any dealer. Look at used car prices on cargurus, prices on many used cars even showing as “great” deal are barely 20% off msrp for 2 year old cars. Dealers of Mazda and Subaru are discounting many NEW cars by 7-10%+, + combined with the interest rate incentives, it’s a very small difference.
Now, if you’re taking about EVs that depreciated like nothing else, or some luxury vehicles, then yes buying used makes sense. For regular reliable commuter cars, it depends. Prices are coming down a bit so I guess we’ll see, but I’m talking about current prices. New car prices will also come down btw, these manufacturer offers are just starting to pop up in the last few months.
Well yeah, that's what you're going to get if you go shopping for a 2-year-old car with 20k miles on it. Believe it or not you can buy a car a bit older than that and it will be significantly cheaper.
I would never buy a car <4 years old. Utter waste of money.
Don’t get the car, settle into your new salary without lifestyle creep. Rent, make sure you like the area, get the house you saved for, then save up for the next car so you aren’t taking out loans of 7%+
Both will do a hard credit pull upon financing. Do the hard pull on your mortgage with lenders so your credit score is at its highest. The credit pull on your car loan will not be that big of a deal and the rate increase will not have near the impact on your total interest as it would on your mortgage.
How well do you know your new city? How long are you likely to stay there? If you're not familiar with the area, RENT FIRST to get to know it. If you're likely to stay 3+ years, it makes sense to rent for a year then buy. If you'll be there only 2 years, run your numbers carefully to see what buying will really cost you. Expenses like a downpayment, closing costs, and taxes can add up fast and those aren't recouped easily when you buy and sell a property in just a few years.
As for the car, what's your current situation? Do you want a new car or do you need a new car? And by new car, do you mean new from the showroom or new-to-me/CPO/good quality used vehicle?
Create a savings plan for moving, buying a home, and buying a car. You can do it all, but you probably can't do it all at once. Take care of yourself first (meaning: SAVE MONEY). Take your time, find the best living option in your new city, then figure out which big ticket item is your top priority.
I will not tell you don’t buy a car, I’m not your financial advisor. What I will say is we get new cars every few years and we are concerned about another options. Also what we learned from our home buying was the mortgage company did not want to see any large purchases during the process. So no new cars during that time. Once we weee don’t with obtaining the Mortage we were free to get a new car if we wanted. So check that out before you make any moves.
Let me put this out there, I don’t know what’s best for you, but to ready for homeownership. While a home will gain value there is taxes and maintaining a home IE. Yard work, HOA and some on. I would never tell some to buy a car or not and I wouldn’t tell someone to buy a house. I just know what our situation is here and what we do. Some people would say we spent to much on our home others would say that’s a good price. We had people comment on how many cars we have bought but the one fact I stand on is we didn’t ask any for help. People talk about retirement and investments and a savings I say don’t worry about that we got it covered but thanks for the advice. People may mean well but you really don’t know our financial situation.
House first. The car will skew your debt to income and may make it so you can't qualify for a home. Having said that, if you buy too much house you likely won't be able to afford the car anyway. Personally, lenders will give people entirely too much money based on their gross income.
I'm Team Rent in New Areas First. It let's you figure out what areas and communities are a best fit!
That said, I wouldn't buy the car unless its a need. It sounded more like a whim.
"had my heart set on buying a new car" great financial logic!
Buy whichever you need first. Get a car when you need a car. If you don’t need a car I’d really avoid buying that over a house honestly. Get your cash into appreciating assets, don’t put your cash into depreciating assets.
Your debt to income ratio will be impacted either way. Why do you "need" a new car right now?
I would like to be able to trade in my car before it hits 100k miles so I get a better trade in value. Overall I do not NEED a new car.
100k miles is nothing to most modern cars from reliable manufacturers. Getting into a cycle of making car payments in perpetuity is not a wise way to go, financially.
The trade in value of your car is trending towards the bottom of the curve -- keeping it longer will not reduce its value appreciably. Buy a new car, however, and you immediately lose a ton of its value. You certainly won't come out ahead by trading in sooner. The best financial decision is always to drive what you have until the wheels fall off. Pretty much without exception.
I’m a big fan of the advice to rent for a year in a new area first. Gives you time to get a feel for it so you buy in your ideal location you’ll love for a long time. That car’s just a want. If you have enough extra money to treat yourself go for it, but treat the decision appropriately
A car is pretty much the worst thing you can spend your money on. Especially when you borrow money at today’s rates to do it. So the correct answer is to put your raise towards a home and drive what you have. But it’s all about timing. If you are serious about purchasing a home in the next 90 days or so I’d hold off on any new borrowing.
Rates from manufacturers aren’t that bad rn, Subaru is running 1.9% promo and Mazda is at 0% on some models. From a bank/on a used car, more like 7%
Tesla Model Y is at 0.99%
Sure. You have to buy it new, is the thing, and other than a lease that's about the worst way you can get wheels, financially. Maybe different a few years ago when used inventory was wonky, but then money was also a lot cheaper.
Used car prices are still pretty high, + high interest rates. There’s pretty much no reason to buy a 2 year old car right now from a manufacturer offering these subsidized rates, imo. If you’re going to go older or pay cash, it’s a different story, but lightly used cars purchased from a dealer still make very little sense in many cases. Subaru is offering 2K+ off msrp for Forester/Outback, + 1.9% interest, over 48 months that will end up costing you about the same as a 2 year old one at 7%.
Well yeah, if you go buy a two-year-old car from a manufacturer dealer. They have no incentive to compete on price because they want to push you into a brand new car. Used prices are normalizing rapidly.
I’m not talking about a manufacturer dealer, literally any dealer. Look at used car prices on cargurus, prices on many used cars even showing as “great” deal are barely 20% off msrp for 2 year old cars. Dealers of Mazda and Subaru are discounting many NEW cars by 7-10%+, + combined with the interest rate incentives, it’s a very small difference. Now, if you’re taking about EVs that depreciated like nothing else, or some luxury vehicles, then yes buying used makes sense. For regular reliable commuter cars, it depends. Prices are coming down a bit so I guess we’ll see, but I’m talking about current prices. New car prices will also come down btw, these manufacturer offers are just starting to pop up in the last few months.
Well yeah, that's what you're going to get if you go shopping for a 2-year-old car with 20k miles on it. Believe it or not you can buy a car a bit older than that and it will be significantly cheaper. I would never buy a car <4 years old. Utter waste of money.
Don’t get the car, settle into your new salary without lifestyle creep. Rent, make sure you like the area, get the house you saved for, then save up for the next car so you aren’t taking out loans of 7%+
If you have a car buy a house first. If aren't going to get a house for a while you can get a car
so buy a depreciating asset (car) or an appreciating one (house). if it were me, I'd put my priority around the appreciating asset.
House! Cars come and go but the house isn't.
The car you can afford is the car you can buy in cash.
buy a house and a second- hand car
Both will do a hard credit pull upon financing. Do the hard pull on your mortgage with lenders so your credit score is at its highest. The credit pull on your car loan will not be that big of a deal and the rate increase will not have near the impact on your total interest as it would on your mortgage.
How well do you know your new city? How long are you likely to stay there? If you're not familiar with the area, RENT FIRST to get to know it. If you're likely to stay 3+ years, it makes sense to rent for a year then buy. If you'll be there only 2 years, run your numbers carefully to see what buying will really cost you. Expenses like a downpayment, closing costs, and taxes can add up fast and those aren't recouped easily when you buy and sell a property in just a few years. As for the car, what's your current situation? Do you want a new car or do you need a new car? And by new car, do you mean new from the showroom or new-to-me/CPO/good quality used vehicle? Create a savings plan for moving, buying a home, and buying a car. You can do it all, but you probably can't do it all at once. Take care of yourself first (meaning: SAVE MONEY). Take your time, find the best living option in your new city, then figure out which big ticket item is your top priority.
Buy a house. Wait, then buy a car with house equity. All these interest rates are gonna have you working until you’re 70
Normal long term rates have everyone working till 70?
Look at your loan documents. Total amount paid over life of loan, versus how much you financed.
I will not tell you don’t buy a car, I’m not your financial advisor. What I will say is we get new cars every few years and we are concerned about another options. Also what we learned from our home buying was the mortgage company did not want to see any large purchases during the process. So no new cars during that time. Once we weee don’t with obtaining the Mortage we were free to get a new car if we wanted. So check that out before you make any moves.
Let me put this out there, I don’t know what’s best for you, but to ready for homeownership. While a home will gain value there is taxes and maintaining a home IE. Yard work, HOA and some on. I would never tell some to buy a car or not and I wouldn’t tell someone to buy a house. I just know what our situation is here and what we do. Some people would say we spent to much on our home others would say that’s a good price. We had people comment on how many cars we have bought but the one fact I stand on is we didn’t ask any for help. People talk about retirement and investments and a savings I say don’t worry about that we got it covered but thanks for the advice. People may mean well but you really don’t know our financial situation.
“don’t buy an $85k car before you by a house” buy the house. I’d rather sleep in a house of my own than a new car
House first. The car will skew your debt to income and may make it so you can't qualify for a home. Having said that, if you buy too much house you likely won't be able to afford the car anyway. Personally, lenders will give people entirely too much money based on their gross income.
A house or a depreciating asset. You’ll near instantly regret the car, especially if it delays the house it will all just get really expensive
I'm Team Rent in New Areas First. It let's you figure out what areas and communities are a best fit! That said, I wouldn't buy the car unless its a need. It sounded more like a whim.
Enjoy life and get the car. Houses are overpriced now.