Buy used or new?

absolutely buy used whenver possible, a car loses 7% of value the minute you leave the dealership, and then 10% every year, of course cars with high resale value (i.e. japanese & german cars) depreciate slightly less, and cars with low resale value actually depreciate faster (i.e. american, british & korean cars)

cars are so reliable nowadays (especially toyotas, hondas, nissans & subarus) that a car with 30K miles runs almost as good as new.

i bought my 2005 prius last march with 27K miles for $19K from a stupid chevy dealership that didn't even know that the car had bluetooth, gps nav, HID lights, they didn't even know that the JBL was the premium system. It was even in seaside blue which I consider the only nice color pre-2006. (now there is a barcelona red and a new royal blue that is also really gorgeous) They even installed brand new michelin harmony's. The car blue booked for $22k and I consider the blue color worth an extra $1K, a year later and an extra 12K miles later the car still blue books for $19K so I could sell it with no loss despite driving it almost a year.

So here's my advice on buying used:

1. buy used but only from a private party or a stupid non-toyota dealership, you can save thousands of dollars. a Toyota dealership will give you a 7yr 100K powertrain warranty but its not worth paying an extra $3K

2. make sure its low enough miles to be under warranty, also call a dealership with the VIN # to find the exact date that the car is off warranty. a low-mileage car with 18K miles left in the bumper to bumper warranty that expires in 2 months isn't worth paying a bunch extra for because you'll only probably drive 3K miles in that 2 month warranty period.

3. don't be afraid to do a nationwide search on cars.com & get a carfax report, shipping a car is as little as $400 and no more than $750, its worth it to get a car with the options you want and the color you want. You can even fly or take a train there & then drive it home.

4. pick a pretty color, why buy something ugly or boring like beige, silver, gray, white or black. the light Seaside blue (all years) and bright barcelona red (2006-present) are the only colors I find attractive, they also hide dirt decently, and an attractive color will help you keep the car longer because you'll be happier with the car.

5. research and study the vehicle you want, know how to identify options w/o asking the seller, they may not be aware of some of the options, so don't tip your hand, if you do they may realize they have the car listed too low and can raise the price on you or refuse to negotiate. For examble, there is no way to look at the headlights to know if it has HID's, but if you see foglights on the bottom then you know that it means that the prius also has HID headlights because they are packaged together, you can't have one w/o the other. If a prius has the NAV system then it automatically has smartKey, bluetooth & a premium JBL sound system. Although factory leather indicates that the prius has every option avail, be careful because you can add leather aftermarket to a prius that isn't well loaded. Be aware that some features such as tire pressure monitors and MP3 readability and backup camera were added in later years, my fully-loaded 2005 prius does not have any of these newer features.

 

Another factor would be how much you drive....
IF you are like me, I drive approx. 30K miles a year! Buying any used car with 30K+ miles reduces at least a year of use for me. Locally, the difference between a 1-2 yr old Prius w/30K miles and new one was about $2000. For only $2000, I got a new car, full warranty, know maintanence, additional year of use and better choices of options/colors etc.
I'm sure I could have scoured the local papers/internet and been able to save an additional $1-$2000 but it simply didn't seem worth it for a car that holds its value this well.
My $.02

 

Still another factor: how long would you keep the car???

Let's say you buy a brand new Prius with 0 miles at $26K. Then, there's a 3-year old Prius with 36,000 miles, for $20K. Same accessories approximately. Let's assume you drive 12,000 miles a year.

Ten years from now, the brand new Prius would have 120,000 miles on the odometer while the used one would have 156,000 miles. As far as I'm concerned, those mileage figures are close to identical and you were still able to save $6,000. That's $600 per year that you can use to offset your insurance premium or buy you gas!

 

For me it was a no brainer. For the same price 22k I got the color and brand new car.