Three things to know before getting a car in Melbourne

In my experience, the three most important things you need to know before heading to the car dealerships or car yards are:

Number one, know the car you really want or need and stick to it as much as possible.
Number two, know your budget and be very realistic.
Number three, learn how to negotiate and don't be afraid to try.





Firstly, know the car you really want and commit to it.  You will understand why this is the first and the probably the most important tip I can give.  Australia is home to many car sales and review websites that can offer a wealth of knowledge about both new and old, affordable, practical and cheap to run, reliable, cars to avoid.  They also give you a good insight if you are thinking about buying used cars.  Equally important, think about your purpose for the car.  If you think you will keep the car in the next 10 years, align your choice to the life (or lifestyle) you are about to expect.  In that way, if your circumstances chance you don't end up selling a car for a new one at a cost.  Remember, any used car will (always all the time) sell way lower than how much you paid for it.  Visit carsales.com.au, drive.com.au, mynrma.com.au and take your time browsing through these sites.  Car hunting in these sites can be very relaxing activity sometimes.

Secondly, after you have found the type of car you want, know how much you are willing to spend for it.  We are talking about budget.  The price of the car is just one thing, the running cost which includes insurance, registration, petrol, and regular servicing will be an extra cost once you have owned a car.  Insurance can be paid monthly or one time and may vary from a third party (~$200+) to comprehensive (~$800+) in a year and will greatly depend on a lot of factors.  Try getting a quote for the car of your choice in AAMI.com.au so you get a better picture, play around the choices and see how it affects your premium.  Registration is paid once a year and presently costs around ~$600 in Melbourne, like insurance, the price can vary with your location.  If you will drive to work everyday like I do, and live within 20-30 minutes away, you will probably spend around $40-$60 a week in petrol for a 2.0 litre compact suv, so factor that in as well when you choose a car.  Regular servicing is a must if you want to keep your car in good condition.  Some servicing can cost as little as ~$100 and others can be more than that and can be as regular as annual or for every certain number of kilometers.  If you don't want to spend much on servicing, choose a new car with capped-price servicing.  Google it up and you will know what I mean.  Decide if you will pay for the car in cash or take-out a bank loan.  If you have money to spare, then buying the car in cash is always a good option and save loan interests.  If you are thinking of getting a bank loan or get financing, then a standard rate of ~10% per annum is common.  Once you know how much the car of your choice will be, you can work out the figure how much your monthly amortization will be for a term.  Try playing around Westpac's loan calculator here.

To get an even better deal, look out for interest free car deals.  They usually start 3 months before the end of the financial year (end of June) and may extend longer.  If you can get a car for no or very little interest at all, you my friend have found a bargain.

Visiting car dealerships and car yards can be both a fun and intimidating experience.  Just like shopping, the joy of searching for something to buy is always fun.  The intimidating part comes in when a salesman spots you, comes to you, and spends his valuable time asking you questions of what car you want and how this particular car you are looking at or sitting on is just perfect for you.  Be careful with every word you say as they can use it to hook you in.  Do not have second thoughts of saying No if you are not happy with the deal they offer you.  If you find it difficult to resist offers from pushy sales people, bring a friend who can dig you out of the sales-hole.  You will thank your friend for saving you.

Thirdly, Negotiate.  There is so much power in negotiation that you can never underestimate its benefits.  Upon visiting the dealership,  In Melbourne, I find it useful to always ask if for a better price.  I always find myself in a situation that a marked down price can be further reduced.  Whatever the sticker price is on a car, on your mobile phone, look up carsales.com.au and compare the price of a similar car with a comparable age, mileage, and condition.  Always compare, then negotiate.  Negotiate respectfully, because in my experience, a dealership will always work out (to an extent) that they can make a sale from you.

Enjoy car hunting.