It’s every young person’s dream to own their first car.
But does it make sense for them to rush to dealerships and spend a significant amount of money on a brand-new car without being experienced drivers or financially responsible?
Probably not.
Before I tell you why I prefer used vehicles, let me give you some facts.
New cars can be expensive
According to AutoTrader.ca, the average price of a new car in Canada reached $67,817 in 2023. The sale price for a 2025 Toyota Corolla Hatchback in Calgary, for instance, is $29,630.
Then you add sales tax, documentation fees, registration fees, freight fees, inspection fees, title fees, and transfer fees, which cost almost $4,000. You lose that amount the second the car leaves the dealership’s parking lot.
On top of that, financing a new vehicle through a dealership can come with an interest rate of about 6.19 per cent on a 60-month loan term, in addition to the ticket price.
Luxury cars, according to Driversnote, a mileage tracking platform, tend to lose about 48 per cent of their value in the first five years, compared to the 40 per cent that compact cars tend to lose.
For first-time drivers with no driving record, insurance can cost around $3,352 a year for a 2023 Toyota Corolla. The same 2015 model could run about $2,999 in insurance, a 13 per cent difference.
For many new car owners, a warranty will buy you something as valuable as money itself — peace of mind.
For the first few years, most dealers cover labour and costs for potential major issues, such as engine and transmission damage.
More and more electronic parts are being built into new cars, making them more vulnerable to damage. This way, you can call your dealer and have them fix it for you. Some even offer drop-off and pickup services, which you can’t find at used car dealerships.
On the other hand, you can get yourself a 2004 Nissan Maxima for less than $3,000. While it may not be shiny and full of gadgets, it should be enough to get you where you need to be.
Reliability of older cars
Assad Iqbal, owner and operator of A&J Auto Repair, has been in the business for more than 17 years. He says he doesn’t like new cars because of the challenge of getting parts.
“With older cars, you can guarantee the availability of parts of all models, and because a lot of mechanics have seen that specific model,” Iqbal said.
Older cars, Iqbal believes, were built with heavier materials and physically stronger frames and had lower maintenance costs. However, the cost of replacement parts is a major reason some drivers abandon their cars.
Manufacturers are required to produce and provide parts for their cars up to a certain point, then they move on to newer models.
Iqbal made fun of me for not being able to afford more than my current car. He tried to sell me a 2010 Mazda with more than 340,000 kilometres on the odometer in exchange for my 2014 Jeep.
He drives a 1998 Toyota 4Runner.