Buy a Pre-Owned Car, Renew Your COE or Subscribe?
Phase 2 of Safe Re-Opening started on 19 June 2020 in Singapore, which means that most retail outlets and offices will begin to reopen. This also means that more people will be out on the road and on public transport. With the expected influx of foot traffic, especially on public transport, some of you might be thinking of getting your own car to minimise exposure from others and to keep yourselves safe.
Typically, there are a few ways for someone to get a car without buying brand new. You can buy a new or used car, subscribe to a car, or if you already own one, renew its COE. All these methods have their own pros and cons and might not suit everyone.
In this article, we’ll be exploring the benefits and disadvantages of each method. So be sure you read this guide before deciding on what to do!
Buy a Pre-Owned Car
Typically, new car sales tend to trump used car sales. However, over the last couple of months, more used cars have been bought as compared to new cars. This further supports the trend that more Singaporeans are looking at personal vehicles as a form of transportation, instead of public transport.
Buying a pre-owned car is good for drivers who are looking for a ‘cheaper’ car ownership experience and plan to drive for at least a few years.
As mentioned, the biggest reason why people prefer secondhand cars is that it’s cheaper and sometimes offers even greater value. Buying a used car will almost always be cheaper than buying a new car. This is because pre-owned cars have fewer years on their COEs, which lowers the cost of the car.
Pre-owned cars are also more worthwhile due to depreciation. While all cars – new or used, depreciate by the day – the brunt of the depreciation tends to happen in the first couple of years. So the original owner will be the owner that bears most of the losses, which benefits you.
Renew Your COE
Over the last few months, we’ve seen the demand for COE renewals go up. This is because existing car owners with expiring COEs are looking at this option as an economical way to continue driving.
However, we only recommend drivers renew their COE if their car is well-maintained or even underutilized. This is because the maintenance costs of a car that’s more than 10 years old can cost you an arm and a leg! Additionally, it’s important to assess the condition of your car because fixing any issues will cost time and effort. It can also be quite unsafe to drive.
So, all in all, renewing your COE can be quite a risky thing to do. You might not be able to assess how long more you can drive the car for. Imagine renewing your car for 10 years and having it survive only 4 years. That’s 6 years wasted and money down the drain.
But we also understand why people tend to renew their COE.
As mentioned, it can be cheaper than buying a new or used car with Prevailing Quota Premiums (PQP) costing lower. There’s also a sense of attachment one might have with the car, after spending 10 years together.
If you need help renewing your COE, let us know!