[sarabear]

I've never bought a new car before, so I'm torn between a couple options - new or used. I plan to pay cash. I plan to sell it in Fall 2024. How do I estimate the depreciation for each option to determine how much it would cost me net out of pocket for 3 years of ownership?

Option 1 - I (think) I'm getting a decent deal on a new 2021 X5 custom build from my dealer. Unfortunately their used inventory was minimal so I would need to goto a random dealer or shop online for Option 2 used. Finally, Option 3 is to get a new 2021 X3 with the same specs as the x5, but I'm not sure whether, with depreciation and what I could sell for in 3 years, it would cost me the same amount to get Option 1 vs Option 3.

Option 1: 2021 X5 x-line custom build

Option 2: Used 2019 or 2020 X5:
-In comparing used cars with the same options as my custom build (my required options: premium pckg, parking assist, contour seats, leather), every dealer or online site such as cars.com is advertising these for roughly $58-60K with the same options before taxes. How much should I aim to negotiate below their advertised price? Should I stick to KBB values?

Option 3: New 2021 X3 with same specs as Option 1.
($10K difference between the option 1 X5).

Which would provide the best $ savings over 3 years?

[dustinrb1985]

I've bought new before and swore I'd never do it again but I only kept that car for like 1 year so that was my fault lol. However, I'm in the same boat as you and I've searched the used market high and dry and I think option 1 new X5 is prob the best one.
The dealer here asking 65k for a Msport 2020 with 6k mile demo granted it does have a 76k sticker but geez seems like people are paying less that that or around that for a 2021 new

[TurtleBoy]

There is a huge difference between the X3 and X5 as far as comfort, luxury, options, etc. so there is no way to spec the two the same. In my opinion your first decision should be whether you want to have an X3 or an X5.

Vehicles take the biggest depreciation hit in the first couple of years so it would be least expensive to buy a 2 or 3 year old X5 versus a new one if you are going to sell in three years. I have attached a depreciation curve and table for the X5 according to

That said, I would suggest not looking at the from a money point of view but rather which would you want or feel more comfortable with. If it was me I wouldn't even consider getting a used one but I have always purchased or leased new. I like to have a vehicle from the beginning of its life so I know the history, maintenance, usage. etc. Many, perhaps most, do not espouse that notion and are very comfortable buying used since it usually is less expensive.

Another thing to keep in mind is your discount program, that makes a new vehicle much less expensive than usual and you won't have that savings with a use one so that cuts down on the depreciation/cost difference.

[sarabear]

Originally Posted by TurtleBoy

There is a huge difference between the X3 and X5 as far as comfort, luxury, options, etc. so there is no way to spec the two the same. In my opinion your first decision should be whether you want to have an X3 or an X5.

Vehicles take the biggest depreciation hit in the first couple of years so it would be least expensive to buy a 2 or 3 year old X5 versus a new one if you are going to sell in three years. I have attached a depreciation curve and table for the X5 according to

That said, I would suggest not looking at the from a money point of view but rather which would you want or feel more comfortable with. If it was me I wouldn't even consider getting a used one but I have always purchased or leased new. I like to have a vehicle from the beginning of its life so I know the history, maintenance, usage. etc. Many, perhaps most, do not espouse that notion and are very comfortable buying used since it usually is less expensive.

Another thing to keep in mind is your discount program, that makes a new vehicle much less expensive than usual and you won't have that savings with a use one so that cuts down on the depreciation/cost difference.

This graph is very helpful, and just what I was looking for. Your advice is also spot-on, thank you.

[-Vanguard-]

Originally Posted by sarabear

This graph is very helpful, and just what I was looking for. Your advice is also spot-on, thank you.

I was looking into a used 2020 X6 and it was only like 6K below MSRP. I was able to get a new 2021 for 7K below MSRP lol.

[sarabear]

Originally Posted by -Vanguard-

I was looking into a used 2020 X6 and it was only like 6K below MSRP. I was able to get a new 2021 for 7K below MSRP lol.

That's the problem. Lack of inventory of used 2019-2020 provides no savings over a new one. The only 1-2 year old models I found that were roughly 10k cheaper than a newer model had less options.

The one thing I don't understand about this depreciation curve is whether the calculations (and resulting resale values) are based off the MSRP price or the price I would initially pay out the door.

[TurtleBoy]

Originally Posted by sarabear

The one thing I don't understand about this depreciation curve is whether the calculations (and resulting resale values) are based off the MSRP price or the price I would initially pay out the door.

It would always be based off MSRP, just like the RV with a lease. The value of a used car does not depend on what type of deal the original owner was able to get.

[-Vanguard-]

Originally Posted by sarabear

That's the problem. Lack of inventory of used 2019-2020 provides no savings over a new one. The only 1-2 year old models I found that were roughly 10k cheaper than a newer model had less options.

The one thing I don't understand about this depreciation curve is whether the calculations (and resulting resale values) are based off the MSRP price or the price I would initially pay out the door.

The depreciation curves have never been real world. They are based on average markets. If you live in a high demand area, your value will be higher.

Values also depend on reliability and it seems BMW nailed the reliability with this new B58 engine.

[TurtleBoy]

Originally Posted by -Vanguard-

The depreciation curves have never been real world. They are based on average markets. If you live in a high demand area, your value will be higher..

Definitely, they are an average prediction which no one will likely achieve. In actuality the vehicle will be worth thousands less or more.

I personally have never considered the future value of a vehicle when deciding on one to buy. I look at what I need, and more importantly want, in a vehicle and go from there to find the best vehicle in the price range I want to spend.

[sarabear]

Originally Posted by TurtleBoy

There is a huge difference between the X3 and X5 as far as comfort, luxury, options, etc. so there is no way to spec the two the same. In my opinion your first decision should be whether you want to have an X3 or an X5.

Vehicles take the biggest depreciation hit in the first couple of years so it would be least expensive to buy a 2 or 3 year old X5 versus a new one if you are going to sell in three years. I have attached a depreciation curve and table for the X5 according to

That said, I would suggest not looking at the from a money point of view but rather which would you want or feel more comfortable with. If it was me I wouldn't even consider getting a used one but I have always purchased or leased new. I like to have a vehicle from the beginning of its life so I know the history, maintenance, usage. etc. Many, perhaps most, do not espouse that notion and are very comfortable buying used since it usually is less expensive.

Another thing to keep in mind is your discount program, that makes a new vehicle much less expensive than usual and you won't have that savings with a use one so that cuts down on the depreciation/cost difference.

A belated thank you for your message, it helped reaffirm my decision. It's my first time buying a new car and I felt guilty and began second-guessing my decision of spending too much on something that'll quickly depreciate and wasn't a smart investment. So then I started to convince myself that a used or smaller model with most of the options would still be good enough and I'd be mostly happy.

But at the end of the day, after reading your post, I was reminded that the only car I've truly wanted the past two years has been the new g05 with the specific options that I want, and that's what would make me 100% happy. So I pulled the trigger and put in the order a few days after this post. I'm excited that it has finally entered production.

[xDrivex5]

Just curious, what are these special options that you wanted?

[TurtleBoy]

Originally Posted by sarabear

A belated thank you for your message,...So I pulled the trigger and put in the order a few days after this post. I'm excited that it has finally entered production.

Glad it helped. Congratulations and hopefully the wait isn't too long. Good luck, enjoy and be safe.

[sarabear]

Originally Posted by Marko_1

Just curious, what are these special options that you wanted?

Nothing out of the ordinary, the dealer had little stock left so each lot model was was missing one preference or other - premium pckg, or park assist, or leather contour seats, or the color combination.

The custom build cost me the the exact same price as a lot model and since I’m stuck indoors mostly in the time of Covid, I didn’t mind waiting a month.

On a side note, the dealership closer to my house had exactly the options I wanted on a lot model (except the trim but it wasn’t a deal-breaker) and a similar price . BUT the saleslady they directed me to (maybe because I was a female too?) was totally rude and impatient from the get go - maybe she didn’t take me as a serious buyer.

Joke’s on her though because I took two girlfriends to the much nicer salesman at the 2nd dealership - where I placed my custom X5 order, and my gf’s bought a $95K+ X7 and a $80K+ X5 M off their lot the same week when they initially had no plans for car buying just the week before and definitely not a bmw. Moral of the story - be kind to customers!! 😊

[xDrivex5]

Originally Posted by sarabear

Moral of the story - be kind to customers!! 😊

[gqgambler]

Totally agree. I've walked away from many deals because of dealer attitude and found some place that appreciated my business. It's amazing to me that dealers would think that someone is not a serious customer when looking to spend near $100k on a car.

[wahoorad]

Hi Folks,

New to this forum. I have an opportunity to buy a MY21 X5 40i with Msport package and pretty much every option checked (list is $76K exclusive of destination fee which would add another $1000 so $77K) that they are willing to sell me for $62995. A CPO for this vehicle would be $1550 and dealer says it will cost $400 to add back in the 3 years "complimentary maintenance". Car only has 1500 miles as the original owner has now ordered a X5 50i. A new model with the features I want (don't need executive package, msport,etc.) I can get for $64K. Which is the better buy? At just over 1500 miles I feel like the practically new that I could CPO and add back in service for a total $65K prior to taxes would be a better deal since its taken its depreciation hit already. Financing would be better on the new car, obviously, though. Thoughts?

thanks!

[TurtleBoy]

The $65k may not be a great buy when you compare against new, you need to look at the numbers. In your area it should be possible to get a 10% dear discount which would bring that $77k down to $69,300. In many areas there is a $2,500 APR credit for financing so you would be at $66,800. If that is the case then the savings buying a used one is only $1,800. Either way, you need to decide what having a new vehicle versus used is worth to you.

You also should consider what vehicle you need/want. If you truly don't care about the M Sport and Executive packages then configure the X5 you want and shop it around to various dealers to see what price you can get.

[wahoorad]

Originally Posted by TurtleBoy

The $65k may not be a great buy when you compare against new, you need to look at the numbers. In your area it should be possible to get a 10% dear discount which would bring that $77k down to $69,300. In many areas there is a $2,500 APR credit for financing so you would be at $66,800. If that is the case then the savings buying a used one is only $1,800. Either way, you need to decide what having a new vehicle versus used is worth to you.

You also should consider what vehicle you need/want. If you truly don't care about the M Sport and Executive packages then configure the X5 you want and shop it around to various dealers to see what price you can get.

Thank you for your prompt reply. I may begin to shop around for a new vehicle as the pre owned will not be available till the end of February. I don't have to CPO the used one which would save $1550 which would bring savings total to $3300 so not sure if you think that is worth the deal. While I don't need the extra option, things like the luxury seating package are nice. Do you not think having the first owner take the depreciation cost gives me some built in equity? How do you go about shopping for a good deal outside your area, use a broker?

thanks again

[TurtleBoy]

Originally Posted by wahoorad

Thank you for your prompt reply. I may begin to shop around for a new vehicle as the pre owned will not be available till the end of February. I don't have to CPO the used one which would save $1550 which would bring savings total to $3300 so not sure if you think that is worth the deal. While I don't need the extra option, things like the luxury seating package are nice. Do you not think having the first owner take the depreciation cost gives me some built in equity? How do you go about shopping for a good deal outside your area, use a broker?

thanks again

No, there is such a small difference in price between the new and used that depreciation does not come into play for me. Besides that, these are not investments and I know they generally depreciate like crazy the first few years and this vehicle is still in the steep part of the depreciation curve. Keep in mind though, I am not making this decision, you are. I personally don't like to buy used and am willing to throw the "extra" money at new.

Email is probably the best way although you could call first to make a contact before emailing them your build. Folks have used brokers and have had very good success. You are also fairly close to SC so you could do PCD and buy from any dealer in the country and pick it up in Spartanburg.

There are a lot of folks here who are willing to share their experiences and contacts. You may want to create a thread and ask any questions you may have in order to get all the information you need to proceed.

[TYE]

are you guys still seeing discounts of 10% + on new? ive been searching for a x5 m50i and had 6 dealers tell me msrp is best they can do because of supply chain issues creating low inventory, even my own dealer who i leased a 440 gc from that is coming up for turn in. one dealer said 1500 over invoice but that only was a 6% discount. and then a broker told me no discounts to be had right now cause of reduced inventories and that 10%+ discounts are over. Fwiw ive been shopping the california and oregon markets as I am in california. thought even a middle america dealer told me the same.

[wahoorad]

Originally Posted by TurtleBoy

No, there is such a small difference in price between the new and used that depreciation does not come into play for me. Besides that, these are not investments and I know they generally depreciate like crazy the first few years and this vehicle is still in the steep part of the depreciation curve. Keep in mind though, I am not making this decision, you are. I personally don't like to buy used and am willing to throw the "extra" money at new.

Email is probably the best way although you could call first to make a contact before emailing them your build. Folks have used brokers and have had very good success. You are also fairly close to SC so you could do PCD and buy from any dealer in the country and pick it up in Spartanburg.

There are a lot of folks here who are willing to share their experiences and contacts. You may want to create a thread and ask any questions you may have in order to get all the information you need to proceed.

Turtleboy, you've been super helpful. One last question. I appreciate that you like to buy new, and honestly I am the same way and have always purchased new and gotten very competitive financing (no more than 1.9%) but the near new (<1500 miles) of this particular vehicle is compelling. That being said I will try and shop around for a less equipped new.

My question for you has to deal with extended warranties. I have typically bought historically more reliable Japanese cars. My brother has had Mercedes and paid out the nose in repair costs. The CPO I could buy costs 1550 and would give me one more year of warranty and unlimited miles (up to 5 years), so maybe more peace of mind than value. Since you buy new do you ever buy an extended warranty given BMW's historically high maintenance costs?

thanks!

[TurtleBoy]

Originally Posted by wahoorad

Turtleboy, you've been super helpful. One last question. I appreciate that you like to buy new, and honestly I am the same way and have always purchased new and gotten very competitive financing (no more than 1.9%) but the near new (<1500 miles) of this particular vehicle is compelling. That being said I will try and shop around for a less equipped new.

My question for you has to deal with extended warranties. I have typically bought historically more reliable Japanese cars. My brother has had Mercedes and paid out the nose in repair costs. The CPO I could buy costs 1550 and would give me one more year of warranty and unlimited miles (up to 5 years), so maybe more peace of mind than value. Since you buy new do you ever buy an extended warranty given BMW's historically high maintenance costs?

thanks!

No, I have never bought one and likely never will. Odds are any single vehicle would not need enough repairs to have paid for the extended warranty, hence why they sell it at the price that they do. (Obviously there is mark-up to consider so this is just a simplification) I choose to play the odds and save the money that I would have paid for the extended warranty and if I have to pay for repairs I will.

I do have to say that currently I'm leasing so extended warranty wasn't a question. However I'm in the process of buying an M340i and will be buying an M50i when my lease runs out at the beginning of next year, I won't be buying an extended warranty with either.

Another way to play it is to wait until your factory warranty is just about out and then consider an extended warranty. If your vehicle has been trouble free then it will likely continue to be that way. On the other hand, if it was constantly being taken in for warranty work it may be worth purchasing an extended warranty.

Edit: I should also say this is my first BMW, in the past I also had very reliable Japanese vehicles.