In the market for a new car? Chances are you’ll have heard all sorts of well-meaning advice from friends — whether you should buy privately or from a dealer, if there’s a particular colour that’s best, or what’s the best deal if you’re looking for finance. But what’s fact and what’s fiction? Here are some top tips to give you a head start before you hit the showrooms.
Cars of particular colours have a higher resale value
This can be true, says Sajjad Bhanji of Dubai-based used car dealer Deals On Wheels, so it’s something you may want to consider if you’re planning to resell the car further down the line. Although many buyers think an unusual colour makes the car more unique and therefore easier to sell, in fact the opposite is often the case. “Some colours are more popular than others and as a result they sell faster,” Bhanji explains. “White tends to be a favourite in the UAE.” So, if a higher resale value is important to you, go for a popular colour and you’ll find yourself with a wider pool of buyers when the time comes to sell.
Wait for annual sales or holiday seasons to get the best deals
While billboards around the UAE make it clear that there are deals to be had year-round, some car owners have found it pays to wait for specific times of the year — if you can — to get the most bang for your buck. “I change my car every few years and I always buy either during Ramadan or Eid, or towards the end of the year when I know the dealerships will be trying to sell off the last of that year’s models,” says Rami Khoury, 28, from Lebanon. “Usually during [holiday times], there will be good prices, and at the end of the year dealers tend to offer longer warranties or extra service warranties, or even free insurance.”
Don’t take the first deal you’re offered. You can always negotiate
If you’re looking to buy a used car, chance your arm and see if the salesman is willing to haggle with you; Bhanji says, dealers in the UAE will often entertain negotiation.
Customers say the same. “I’ve always found used car dealers to be open to negotiation, as long as I approach them in a friendly way and am not unreasonable,” says 42-year-old Briton Alex Murray. “And if they really can’t budge at all on the price, I try and get extras thrown in for free, such as a wheel cover or window tinting.” However, buying a new car may well mean your haggling options are somewhat more limited, as Murray has experienced. “I’ve found new car sales staff far less willing to negotiate, with some refusing point-blank,” he says. “Dealers seem to operate far more of a fixed-price policy with new cars.”
If you’re buying a car with finance, you’ll need to make a 20 per cent down payment
Auto loan financing rules are decided by the UAE’s Central Bank, so this one’s currently true for all banks offering auto loans. But this doesn’t mean auto loan deals will necessarily be the same at each and every bank. The 20 per cent down-payment and maximum five years tenor will be similar, but eligibility criteria and pricing will vary from bank to bank. Moreover, there are added benefits the customer can obtain such as a free current account until loan maturity, a free credit card and insurance finance.
You can take a loan from any bank — not just the one where you have a salary account
Although you’ll need to find your 20 per cent deposit whichever bank you choose to finance with, you won’t necessarily have to take the auto loan with your own bank if you find another bank offering a better deal. A quick scan of various lenders in the UAE reveals many offer auto loans without salary transfer, meaning you can shop around and ensure you’re getting the best loan product for your needs.
You’re better off buying a used car privately so you pay less
While cost is often a major factor in a car purchase, buying privately to try and get a cheaper car may prove to be a false economy. Bhanji says buying through a dealer could give you greater security and peace of mind, not to mention assistance with the associated formalities.
“Deals On Wheels ensures that all our cars are inspected before they are sold, which allows us to show prospective buyers the details and the current mechanical/technical status of the car they are considering buying,” Bhanji explains. “This is often not available when you buy a car privately. In addition to this, we offer assistance with financing, insurance, registration and vehicle testing, which is not necessarily available with a private seller.”
A car with full options keeps its value better
Leather seating? In-car entertainment with built-in DVD players? Xenon lights? Of course, your budget will normally dictate the options you can choose from when buying a new car, but for some models, you may end up with an even higher resale value if you’ve gone for top-of-the-range to start with. Bhanji says in certain sectors of the market, the more you can afford the better when it comes to reselling.
“Depending on the type of car, options can play a big part in the resale value,” he explains. “This is particularly true for luxury or high-performance cars.”
