Should I sell my car?

A_Forlorn_Hope · 7 August 2018 at 11:09PM

Hi everyone,
I recently acquired a Fiesta ST for £12k and I love it! It's perfect in many ways (except practicality perhaps!) but as a pre-first time buyer, I'm very conscious that a lot of money is tied up in something I could otherwise be using for a deposit.

Currently I have around £33k saved across my ISA and LISA. PXing the car for something cheaper could net me around £9k before the exchange. Of course the depreciation sucks but it might be worth it for extra savings. The plan is to move in with my partner in around a year or two. Driving is essential for my job so I need a car.

I'm just wondering if it's worth relinquishing a car I love to get some extra cash. At the end of the day a house is more important than a car, right? Any input would be greatly appreciated!

TL;DR - Should I take a £3k hit on a £12k car to get something cheaper and pocket the rest for a house?

wgl2014 · 7 August 2018 at 11:22PM

Not really if you are only going to need the money in a year or two.

If I read that correctly you will take a 3k hit in depreciation and then still need to buy another car?

A_Forlorn_Hope · 7 August 2018 at 11:34PM

Correct, AutoTrader is reckoning I'll get £9k-10k for the car. As I need to drive so much I'll need to spend around £3-4k on a decent car which will leave me with around £6-7 to add to my savings.

Mercdriver · 8 August 2018 at 12:15AM

KHouldey wrote: »

Correct, AutoTrader is reckoning I'll get £9k-10k for the car. As I need to drive so much I'll need to spend around £3-4k on a decent car which will leave me with around £6-7 to add to my savings.

Have you budgeted within that for the extra maintenance that the cheaper car might require?

A_Forlorn_Hope · 8 August 2018 at 12:34AM

The cars I'm looking at have just been serviced. As they're older they may need a bit more attention over time but for now the extra savings seem worth the change.

Mercdriver · 8 August 2018 at 1:08AM

KHouldey wrote: »

The cars I'm looking at have just been serviced. As they're older they may need a bit more attention over time but for now the extra savings seem worth the change.

By service do you mean full service with everything checked and not simply an oil and filter changed. Have the Cam belts/chains been checked alongside the water pump? When it comes to a car that has been on the road some time with miles (and don't assume that low mileage for the year is a good thing) then there are many expensive things that can go wrong, and if you find your engine going pop you might struggle to get in to work to pay your mortgage.

You have to do the sums carefully. A 3 - 4k car is really costing you 6 - 9k. You will need to set aside money for work to be done bearing in mind it is far more likely that you will need that money for a rainy day with the car, and may not actually have it available for use.

A_Forlorn_Hope · 8 August 2018 at 6:32AM

Thanks for raising the issue. This is bearing this work in mind, yes.

foxy-stoat · 8 August 2018 at 9:34AM

If you own it outright then keep it, unless you are short on your deposit by £5K.

If your paying finance on it then selling it is an option I would look at.

A_Forlorn_Hope · 8 August 2018 at 9:52AM

So it's not worth changing for the extra dough?

Herzlos · 8 August 2018 at 10:01AM

KHouldey wrote: »

So it's not worth changing for the extra dough?

Not right now, no. You'll take a hosing on the trade in and will get an older, unknown car. The cheapest car to drive is almost always the one you currently own.

So you're as well holding onto it for now, and you can sell it if you need to top up your deposit any.

How did you purchase it? Cash/HP/PCP?

A_Forlorn_Hope · 8 August 2018 at 10:08AM

Thanks for your input

I actually traded a newer car for it so it's fully paid for. I think due to this I'm just seeing it as extra money I could bank, even despite the depreciation.

Should I sell my car?

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