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

1,602 Views | 27 Replies | Last: 2 hrs ago by Green2Maroon
Dr. Doctor
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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
MouthBQ98
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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.
AustinCountyAg
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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.


Tone2002
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A tale that is old as time…
HollywoodBQ
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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.
Teslag
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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.
maverick2076
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Serious question: have you considered leasing? Unless you are a high mileage driver, it's literally built for your use case
TexAg2001
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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.
BigPete3281
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-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.
AggieGunslinger
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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.
EMY92
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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.
91AggieLawyer
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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.
TxSquarebody
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You guys drive new stuff??
Kyle Field Shade Chaser
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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.
YouBet
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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.
Teslag
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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.
Average Joe
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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.
idAg09
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What new family vehicle do you think will make it 10+ years now? I also think this will be a major problem
Charismatic Megafauna
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idAg09 said:

What new family vehicle do you think will make it 10+ years now? I also think this will be a major problem

Grenadier and gr86, most 3/4 ton trucks (not Dodge)
HumbleAg04
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0% for 60 or 72. All day. I'll even consider 1.9% for stupid purchases.

Free money for a ****ty asset that depreciates immediately plus I like ventilated seats.
MouthBQ98
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I would think got a low mileage trip option, you should be able to get a reliable electric car. Fewer moving parts and relatively simple and low maintenance, in theory. Outside of that, Toyota's planetary based hybrid system has proven pretty reliable. I'd be fine with something based on that. There are probably some reliable value options to be had even in the new market but I think you have up work pretty hard to find them now. I just think it is unfortunate that we in the USA are forced to buy needlessly expensive models with less reliable drive trains and loaded with redundant technology to our cell phones that goes obsolete snd seems to break or fail more often. It's frustrating to watch foreign nations get what I consider much better vehicle choices from some manufacturers.
HollywoodBQ
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Quote:

I just think it is unfortunate that we in the USA are forced to buy needlessly expensive models with less reliable drive trains and loaded with redundant technology to our cell phones that goes obsolete snd seems to break or fail more often. It's frustrating to watch foreign nations get what I consider much better vehicle choices from some manufacturers.

In Australia, we did get cars from places like Spain and France and Italy which we don't get as much of, or at all in the US. And of course the Proton cars from Malaysia and some JDM imports.

Here in the USA, you can buy a Roxor Jeep at a tractor dealership these days.

I'm curious what redundant technology you're talking about between your car and your cell phone?
Is it just navigation and Internet that you're talking about or is there something else?

I did get a laugh last year when my Aggie 2017 daughter figured out that if she used the navigation built into her car, she didn't have to screw around with her phone while she was driving. I tried to tell her that but... some things they just have to figure out on their own.

Of course the navigation in my 2020 Jeep is impossible to program while the vehicle is moving.
Average Joe
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idAg09 said:

What new family vehicle do you think will make it 10+ years now? I also think this will be a major problem


Probably go Toyota, Honda or Kia. Kia has moved up the reliability grades recently, but has always been cheap to repair.

I don't expect them to be problem free for 10 years or keep up with technology for 10 years. If they are easy to maintain, repair myself, and get cheap parts for then getting 10 years out of one shouldn't be difficult.

That said, our oldest will be in college in 7 years, so might not drive this one as long.
crowman2010
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0% interest for any term - sign me up
BlueSmoke
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I'm 52. The only vehicles I have owned over the course of my life:

  • '88 F-150 extended cab with the inline-6 and dual gas tanks. Stick shift. 4x2
  • '90's era F-150 extended cab with the baby V-8. Stick shift. 4x2
  • '03 FX4 F-150 with the Triton 5.4L. First automatic vehicle in my life
  • '13 FX4 F-150 ecoboost. All the bells and whistles
  • '19 Tundra TRD with the 5.7
Very things in life with tank a household budget more than multiple car payments. Are there days I miss heated seats and better tech, of course. Do I miss them more than a new car payment and repair bills. Not a chance.
agracer
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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.




it's prevalent in the exotic car world as well.



can we no longer post YouTube videos/links?
agracer
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HollywoodBQ said:

Quote:

I just think it is unfortunate that we in the USA are forced to buy needlessly expensive models with less reliable drive trains and loaded with redundant technology to our cell phones that goes obsolete snd seems to break or fail more often. It's frustrating to watch foreign nations get what I consider much better vehicle choices from some manufacturers.

In Australia, we did get cars from places like Spain and France and Italy which we don't get as much of, or at all in the US. And of course the Proton cars from Malaysia and some JDM imports.

Here in the USA, you can buy a Roxor Jeep at a tractor dealership these days.

I'm curious what redundant technology you're talking about between your car and your cell phone?
Is it just navigation and Internet that you're talking about or is there something else?

I did get a laugh last year when my Aggie 2017 daughter figured out that if she used the navigation built into her car, she didn't have to screw around with her phone while she was driving.
I tried to tell her that but... some things they just have to figure out on their own.

Of course the navigation in my 2020 Jeep is impossible to program while the vehicle is moving.

You still have to fool around with the navigation on the car to get it going unless you do it before you start driving, which you can also do with the phone.
Green2Maroon
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2017 Prius, bought with cash for $14k in 2021. Purchased with 75k miles, now 150 ish. Great car, no issues other than basic maintenance.

2010 Tacoma, bought with cash for $16k in 2019. Purchased with 148k miles, now 175k. It needed more maintenance and more money into it initially but no real issues.

I suppose I could have one nicer car or two cheaper ones. I would rather have two cheaper ones. I live in a big city with a long commute to work and drive Lyft now and then. I'm also near the mountains and like to go up there and do more outdoor stuff.
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