RX depreciates like crazy
07-13-09, 07:51 PM
#31
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Location: California
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I bought my RX350 2wd with nav and luxury package new back in 2007 for about $42,500 +tax. It has little over 11K miles, in prestine condition. I went to the same Lexus dealer and I asked about the trade-in value. They told me somewhere around $23K. I went to BMW and they said same thing. I know it is a trade-in vakue but my God, these bastards slash almost 50% off the MSRP in about 2 years. These thieves woud then turn around and sell it for $32K. Of course I would never trade it in at this rate. If you want to make quick and dirty bucks, go into Wallstreet, banking industry, become a trial lawyer, or simply work at a car dealer.
The only question I have is what crime I would charge the dealer with, that would have offered "around $23, 000" for it. Attempted robbery, or attempted rape? I just looked on autotrader.com, and dealers are trying to sell them for $32,000 to $37,000, and they all have more miles than yours.
The term "stealership" would have been appropriate if you had sold it to them for $23,000.
07-14-09, 07:42 AM
#32
Moderator
A dealership would not be "stealing" a car if the owner elected to sell it for an agreed price. There is no force or unconscionable leverage being utilized by either side in such a transaction. An owner who sells something for less than its fair market value is simply an uninformed seller.
Also, comparing trade-in values of different transactions is difficult because the dealer looks at the transaction as a single deal, not as two deals. With identical sets of cars, one buyer may pay a higher new car price and take a higher trade-in while the other pays a lower new car price but gets a lower trade-in number. In both cases, the dealer receives the same net amount of cash and ownership of the used car, whatever its value to him happens to be. State taxes often play a part in setting these values; sometimes a buyer knows all about this, and sometimes the dealer knows more about how the system works and takes advantage of the seller, but that's true in every consumer transaction.
Since used car trade ins are always at wholesale, the seller's best deal is almost always selling the car himself to another consumer, which takes time and trouble and some overhead costs, and of course is inconvenient; these are the services the seller is paying for by taking a lower price from a dealer who will take anything in trade. Still, Craig's List and eBay have simplified the direct sale to a great extent, and allow buyers to get a far better feel for the market than KBB. There are the usual risks involved, since there is no CPO or warranty on such sales, usually, but the price is commensurately lower.
Readers and posters here tend to be among the better informed buyers and sellers, for obvious reasons, some newbies excepted.
Caveat emptor.
Also, comparing trade-in values of different transactions is difficult because the dealer looks at the transaction as a single deal, not as two deals. With identical sets of cars, one buyer may pay a higher new car price and take a higher trade-in while the other pays a lower new car price but gets a lower trade-in number. In both cases, the dealer receives the same net amount of cash and ownership of the used car, whatever its value to him happens to be. State taxes often play a part in setting these values; sometimes a buyer knows all about this, and sometimes the dealer knows more about how the system works and takes advantage of the seller, but that's true in every consumer transaction.
Since used car trade ins are always at wholesale, the seller's best deal is almost always selling the car himself to another consumer, which takes time and trouble and some overhead costs, and of course is inconvenient; these are the services the seller is paying for by taking a lower price from a dealer who will take anything in trade. Still, Craig's List and eBay have simplified the direct sale to a great extent, and allow buyers to get a far better feel for the market than KBB. There are the usual risks involved, since there is no CPO or warranty on such sales, usually, but the price is commensurately lower.
Readers and posters here tend to be among the better informed buyers and sellers, for obvious reasons, some newbies excepted.
Caveat emptor.
07-14-09, 07:49 AM
#33
Lexus Test Driver
If you are going to be surprised, offended or disappointed that a new car loses 40 to 50% of it's value during the first 2 or 3 years, you need to do more research or buy a low mileage 3 year old car. As others have pointed out, that is the best financial deal. You don't get a new car, you probably won't get the color and options you want but you will get the best value.
You can use guides, market data or anything else you want but your car is worth what someone will give you for it. The dealer made an offer. They apparently didn't it want it very badly. Take it somewhere else or try to sell it yourself and you'll likely get more. But still with deep depreciation. Or keep it. You haven't been harmed in any way.
When you buy a new car, there are lots of guides that advise 2 things: 1. do reserach to get some sense of price points to have realistic expectations 2. do not discuss tradein in any way until you've negotiated the price of the new car, they negotiate the price of your trade. Certainly 1 will affect the other. the less they make on the 1 the more theny will try to make up for it on the other. As others have said, if you let them blend it together, you can't really tell what is what.
You can use guides, market data or anything else you want but your car is worth what someone will give you for it. The dealer made an offer. They apparently didn't it want it very badly. Take it somewhere else or try to sell it yourself and you'll likely get more. But still with deep depreciation. Or keep it. You haven't been harmed in any way.
When you buy a new car, there are lots of guides that advise 2 things: 1. do reserach to get some sense of price points to have realistic expectations 2. do not discuss tradein in any way until you've negotiated the price of the new car, they negotiate the price of your trade. Certainly 1 will affect the other. the less they make on the 1 the more theny will try to make up for it on the other. As others have said, if you let them blend it together, you can't really tell what is what.
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