Been browsing the used car market and can’t help to notice that there are a lot of luxury models (Mercedes, BMW, etc) less than a year old from purchase date are being sold.
I know cars are expensive here, but is it a case of luxury car buyers underestimating the costs involved?
Alot of people seems to be buying the car for face value which translates to nothing (in literal sense).
At around $87K for Cat A COE, you are paying $240 a day just for a piece of paper. That’s almost 1 taxi ride into town everyday. Add the cost of the car, parking, road tax, petrol, maintenance etc. and I really don’t see the value in car ownership unless you spend hours on the road daily.
Here are what netizens think:
- Some of these owners bought when the COE was lower. COE ranged from 50-80k for Cat A and B respectively a year ago. However, the current COE is 87k & 115k. That’s an almost 40-50% increase for both COEs. So their cars “appreciated” in value instead of depreciated. Hence, a good time to change/upgrade the car.
- Interest rate increase, fuel price increase, overall inflation just caught everyone by surprise.
- My guess is, on average, these people are paying $200 more a month just to service their car loans.
- And with the prospect of recession and job losses in 2023, makes sense that many people are re-balancing their expenditures.
- Or crypto bros realising they can’t pay the monthly loans anymore