Monthly (weekly) article on car pricing and people being bad with money

878 Views | 16 Replies | Last: 3 hrs ago by Average Joe
Dr. Doctor
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6:46a
AG
Car loan terms stretch as vehicle prices remain high

The last paragraph in this article is crazy.

" About 40.7% of new-vehicle purchases involving negative equity are now financed with 84-month loans, according to Edmunds data."

rollin', rollin', rolling. Keep that (negative) equity rollin'....

~egon
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MouthBQ98
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8:07a
AG
That's utterly idiotic. I smile to myself every day. I drive old high mileage but reliable beaters that seem to be in the shop only a tiny fraction of the time all these new rides are, and I get where I need to go without any car payments. I like vehicles too, but there's no value proposition in new vehicles right now. There just is not. The market is badly skewed and it is very annoying because it results in manufacturers not offering any good value choices anymore.
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AustinCountyAg
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9:31a
While vehicle prices have gotten absolutely stupid high I think the biggest problem, which is danced around in the article is the fact people keep rolling negative equity on simply keeping up with jones'. It's one thing to buy an $85k vehicle, but it's another when you trade it in simply for getting something newer. Very few people these days keep vehicles for more than 5 years. Something like 65% of new car buys trade them in under 6 years old.


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Tone2002
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9:33a
A tale that is old as time…
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HollywoodBQ
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In reply to Dr. Doctor • 9:56a
AG
This negative equity business is why I enjoy watching Benzs and Bowties so much.
https://texags.com/forums/46/topics/3582720/replies

The more "negative" the more expensive the Benz.

Side note - you can spend over $200k on a G-Wagen these days.
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Teslag
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In reply to AustinCountyAg • 10:25a
AG
AustinCountyAg said:
While vehicle prices have gotten absolutely stupid high I think the biggest problem, which is danced around in the article is the fact people keep rolling negative equity on simply keeping up with jones'. It's one thing to buy an $85k vehicle, but it's another when you trade it in simply for getting something newer. Very few people these days keep vehicles for more than 5 years. Something like 65% of new car buys trade them in under 6 years old.




I refuse to keep anything more than 3 years. But I always also pay cash or put at least 50% down.
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maverick2076
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In reply to Teslag • 10:45a
Serious question: have you considered leasing? Unless you are a high mileage driver, it's literally built for your use case
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TexAg2001
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11:05a
AG
Many years ago, my wife and I agreed to the following stipulations:
  • No more than 1 car payment at a time
  • Monthly payment cannot exceed $600
  • Payment term cannot exceed 60 months, but prefer 48
We've successfully adhered to this, but it's getting much harder with prices skyrocketing. Luckily, we tend to purchase vehicles with high reliability (Toyota/Lexus), so we can continue to drive them for as long as necessary to have a high enough down payment saved to meet our requirements.
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BigPete3281
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11:30a
-A 2015 Toyota truck that'll I drive maybe 5k/year and I'll get another 150k out of.
-A 2015 Subi that is just now approaching 100k.
-A 2016 Subi for the daughter under 85k.

All paid for. All shall be driven for years.

I've never felt less dumb. I'm not a rich man, but I have no debt. I will never understand people today. It's insane.
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AggieGunslinger
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In reply to HollywoodBQ • 11:50a
AG
HollywoodBQ said:
This negative equity business is why I enjoy watching Benzs and Bowties so much.
https://texags.com/forums/46/topics/3582720/replies

The more "negative" the more expensive the Benz.

Side note - you can spend over $200k on a G-Wagen these days.

One of my favorite IG follows.
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EMY92
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12:56p
AG
The longest I've financed is 4 years, I paid it off early. My other purchases have been 3 years or cash. I can't imagine 84 month car notes.
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91AggieLawyer
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In reply to MouthBQ98 • 1:57p
AG
MouthBQ98 said:
I drive old high mileage but reliable beaters that seem to be in the shop only a tiny fraction of the time all these new rides are


See, THIS is the real issue here. At one point, you could easily justify a $400 car payment because it was going to save you a trip to the shop every 2-4 months to spend...$800-1200. Or, at least, $2500 a year. In other words, you were avoiding paying, say, $6000 a year for a new, reliable, vehicle to pay half that on something you didn't even want to drive out of town (don't ask me how I know that).

But since Covid, there are very few vehicles now, at any price, you can buy new that aren't total POSs. I add makes that I've preferred, including Toyota and Honda, to that list. If it isn't a new generation turbo with issues, it is a CVT.

You would think that the car makers would be happy with a NA 300-hp V6 that gets 22/26 but for some idiotic reason, they aren't. They INSIST on squeezing everything out of a 4 they can, whether it works or not. Regulations are part of that, but not all of it.
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TxSquarebody
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2:25p
You guys drive new stuff??
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Kyle Field Shade Chaser
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2:38p
AG
I'm on the market for new and probably just going to get another used 4 runner.

The 3.5s with turbos have gotten a lot more reliable. The problem is most vehicle they come in, start @$65k - $85k. Which is stupid. My house note is less.
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YouBet
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In reply to 91AggieLawyer • 3:22p
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91AggieLawyer said:
MouthBQ98 said:
I drive old high mileage but reliable beaters that seem to be in the shop only a tiny fraction of the time all these new rides are


See, THIS is the real issue here. At one point, you could easily justify a $400 car payment because it was going to save you a trip to the shop every 2-4 months to spend...$800-1200. Or, at least, $2500 a year. In other words, you were avoiding paying, say, $6000 a year for a new, reliable, vehicle to pay half that on something you didn't even want to drive out of town (don't ask me how I know that).

But since Covid, there are very few vehicles now, at any price, you can buy new that aren't total POSs. I add makes that I've preferred, including Toyota and Honda, to that list. If it isn't a new generation turbo with issues, it is a CVT.

You would think that the car makers would be happy with a NA 300-hp V6 that gets 22/26 but for some idiotic reason, they aren't. They INSIST on squeezing everything out of a 4 they can, whether it works or not. Regulations are part of that, but not all of it.

I've kept my 2016 longer than I planned because the market is dumb. Granted, I also only have 45k miles on it.

But the new cars with all of this tech are bound to be less reliable. No way around it.

My wife's brand-new Kia Telluride (which she loves and is considered one of the more reliable brands out there) has already had two recalls in first 3 months. One for software and she just got another one telling her that the seats may fail in a crash. Not great, Bob.
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Teslag
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In reply to maverick2076 • 5:02p
AG
maverick2076 said:
Serious question: have you considered leasing? Unless you are a high mileage driver, it's literally built for your use case


I put too many miles on them.
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Average Joe
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5:15p
AG
We're about to buy new, but we haven't had a car payment in like 15 years. We have a 2009 Acura MDX that just flipped 200k miles, and a 2012 Camry that just flipped 100k and only drives about 5k/year. Figured we can finally put the MDX out to the pasture and get a new family car we can drive into the ground over the next 10+ years.

New vehicles only make sense if you drive them a long time, or just consider them a luxury item from the get go.
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