Depreciation is the biggest line item
A typical new car loses a large share of its value in the first two to three years. Buying a two- or three-year-old vehicle lets someone else absorb that, which is why certified pre-owned often wins on total cost.
Registration and insurance follow value
California's vehicle license fee is based on the car's value, so a cheaper car costs less every single year, not just at purchase. Insurance follows a similar curve.
Coastal wear is real
Cars that spend years parked near the water in Ocean Beach, Coronado or Imperial Beach see more corrosion on brake and suspension hardware. On any used car near the coast, pay for an independent inspection that includes an underbody look.
When new is the better buy
Low promotional financing, a long factory warranty, or a model with unusually strong resale can close the gap. If you keep cars eight to ten years, new is often reasonable.
- You plan to keep the car past the loan term.
- The manufacturer is offering subsidized financing.
- The used market for that model is unusually tight.