How to work out whether it is better to sell or keep my car?

kirstles

Hi!
I have been going round in circles trying to figure out what to do with my car. Its an 04 Honda Civic and I bought it in July 2009 for £5425 from a dealer. I needed a decent car as I had a 100 mile round trip commute every day in the North West.
However I have just started a three year training programme in London and I don't need a car anymore. However once I qualify in Sep 2013 it is highly likely I will need a car again.
I have advertised the car on auto trader for £3400 but I have had very little interest. I don't know how low to go before it becomes more worthwhile to keep the car off road for three years.
There is somewhere I can keep it for three years. But would the car be ok if it isn't driven for 3 years?
Any advice would be greatly appreciated,
Kirsty.

Hammyman

£3400 for a nearly 7 year old car is quite frankly a bit unrealistic especially with the mileage I expect it has. If its got over 70,000 miles on it, you're going to have to drop it by nearly 50% to get rid.

And no, cars don't take kindly to being stood for 3 years.

jaydeeuk1

Agree with Ham. 7 year old civics start from £1700ish on autotrader so yours is atleast £1000 overpriced, and even then its up against a lot of competition. I take it that its a bog standard model, not a type XX etc?

forgotmyname

Parked up for 3 years, The car will be worth £1000 ish. You may need to spend more than that on seized brakes & clutch etc.

Water pumps can leak, Cooling system can get clogged as any small particals will sink to the lowest point and settle.

Sitting idle is not good for cars.

kirstles

Thank you for your advice on the car price and the leaving it idle for three years...but I'm still stuck. How do I work out whether it is worth selling it for £2400 now when I will most likely need to buy another car in three years?
I could keep the car at my boyfriend's parents house and they would drive it for me every couple of weeks and that would cost me around £600 per year in insurance, tax, service and mot.
I need some sort of equation!

andy111

You should sell it now for approx. £1900. and bank the money.

Assuming your family are genuinely going to store and not really use, your min. outgoings are approx £1k p.a. with tax mot etc.

That car is going to be worth £1k absolute max in three years.

Therefore you have spent min. £3k. and could sell for max. £1k., therefore you are minus £2k over 3 years with no use.

Sell now and get 3% x £1900 int. for three years =c.£2100


Here is the equation;



http://www.math.montana.edu/frankw/ccp/cases/newton/tceqn4.gif

kirstles

Something tells me that you didn't really use that equation, did you?!

I do see your logic though. The only thing is that I'm not planning to sell the car in three years, I'm planning to use it. And that's the point really, I would end up back at square one buying a 6 year old car for £5k.

I diasagree that the car would cost me £1k per year to run. It would be more like £600.

So over three years that means it would cost me £1800...so that means it's cheaper to keep the car rather than pay out £5k twice in 4 years
option a) £5000 + £1800=£6800
option b)£5000-£2000(£3000) + £5000= £8000

Obviously this would be different if I cared about the status of the car etc but I'm not bothered about that.

Thanks for your help

andy111

In three years you will have a nine year old car worth £1k-£1.5k max.
Sorry, I misread £600 for ins. only.

3 x£600, , therefore £1800 over three years to have car worth £1.2k

If you sold now and banked etc =£2100, you could then buy similar 04 Honda for £1.2k in three years and have £900 remainder and none of the grief of keeping vehicle for three years, and not pay the £1800.

kirstles

Thank you for testing my theory, it is really helpful!
The thing is that in three years time I wouldn't buy an 04 honda for £1.2k because I don't know enough about cars to know whether I was getting something decent. If I sold now and bought another one in 3 years I would have to buy something similar to what I bought last year (i.e. a 5y.o car from a dealer for £5k).

forgotmyname

Dont forget any no claims you have built up will probably be lost after 3 years on non use, Some companies max 2 years.

andy111

If you kept the car and paid £1800 over three years you would have a nine year old car in three years worth £1.2k
If you sold now and put that £1800 with your £2100 in three years you could buy a £4k car and no grief of storing. As pointed out above cars tend to prefer reg usage.