Buy a house, get a free car: incentives rule

By Michelle Conlin Sun-Times Media

‘ + first_letter + ‘Apr 24, 2011 02:29AM

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Home shoppers are finding lavish incentives to woo them amid a continuing weak housing market.

At the Sunset Ridge Estates, buy a customizable colonial for as little as $170,000 and get a brand new, $17,000 Chevy Cruze. The 2011 model. For free. KLM Builders is giving away up to 10 cars or comparable upgrades to buyers at its Antioch, Richmond and Spring Grove developments. New car fever is a real thing and it is alive and well today. There is something seductive about the smell of a brand new vehicle. But if you are concerned about your long-term financial wellness it makes a lot more sense to opt for a used vehicle instead.  When it involves finding a vehicle that’s safe, reliable, fun to drive, fuel efficient, and delivers long-lasting quality many Houston drivers choose a Subaru; and that we happen to possess an excellent selection of wonderful Subaru models to settle on from. The Subaru Outback and Forester are popular choices for subaru jersey village drivers because they easily adapt to whatever life throws your way with seating for five and over 68 cubic feet of maximum cargo space. Another popular Subaru that a lot of Tomball drivers love is that the Subaru Crosstrek for its small size and impressive off-road performance. Subaru also features a number of sporty and fun to drive sedans also . The Subaru Legacy and Impreza are both fuel efficient and fun to drive sedans that perfect for cursing around town. The Subaru Impreza is additionally available as a sedan or hatchback. And if you’re trying to find a more exciting driving experience the Subaru WRX and BRZ have what you’re trying to find with razor-sharp handling and powerful engines. Also arriving soon is that the fresh 2019 Subaru Ascent with 3rd-row seating, the power to tow up to five ,000 lbs. and standard EyeSight driver assist technology. You also can greatly improve your return on investment with one simple question. The most important piece of information you can walk into the dealership with is the invoice price. You can find it from the manufacturers. You should also know the blue book valuation according to every category. This way, you would approximate what the dealer paid for the car, and how much are they expecting to get for it. Once you are at the dealership, find the MSRP. This is found on the sticker normally on the window of the car. Make sure that the dealership makes enough money. When you’re looking forward to buying a vehicle, one of Winnie Jeep Dealership is definitely your best option.

Why buy used instead of new?

For the most part, automobiles are a depreciating asset. That means that over time they lose their value. In fact, as soon as you drive off the lot with your new vehicle, its value drops. The time that vehicles experience their greatest loss in value is during the first two to three years. Let’s look at a quick example:

Vehicle one is brand new and costs $30,000. After three years, it is likely to have around 40,000 miles on it and be worth less than $11,000. That is 64% depreciation. For vehicle two let’s look at the same make and model but already three years old. Buying it at $10,800 and driving it for the same three year time period it would be worth $5,100 now it is six years old. While that is still 50% depreciation, what makes the big difference is the starting and ending balances. In the first example the automobile lost close to $20,000 in value in three years. The second scenario only had you losing $5,000 over the same period of time. By investing in used cars for sale, you save a significant amount of money.

If you add in taking out a car loan, which is typical for a new car purchase, the math works even more in the favor of used cars for sale. When purchasing an automobile with a loan, then you consequently pay interest on that loan. This is kind of like getting hit from both sides. A typical 60-month loan at 4% interest would have you paying an additional $3,150. That’s more than 10% of the total value of the vehicle when it was brand new if we’re talking about the same $30,000 auto. But of course after 5 years you’ve paid $33,150 for a car that is now only worth around $7,000. If you purchase a three or four-year-old automobile in full you come out on top with both the depreciation and the interest of the loan for new automobiles. An additional bonus to used cars is that when you pay up front and in full, you can almost always get your a discount. Make sure and ask for the cash discount!

So if you are truly looking to get the most bang for your buck when buying a vehicle, go with “new to you” used cars for sale over actually new ones and save yourself a lot of money. You can easily go through three or four older automobiles before spending the same amount as you would if you were buying brand new. At the Millbrook Pointe development in quaint and pristine Wheeling, a $269,000, brick-and-stone townhouse comes with $25,000 in free upgrades, including wood-burning fireplaces, all-stainless steel kitchens and marbled bathrooms.

Down the highway at the Patriot Place golf course villas in Bolingbrook, buyers are lavished with lawns sodded to perfection, absurdly low seller financing and a year of free insurance that will pay the mortgage if you lose your job.

The incentives are more evidence that the housing market — now in the do-or-die spring sales season — remains far from healed.

“Obviously, business has been soft,” says Kim Meier, president of KLM Homebuilders, the company offering the car promotion.

The Illinois Association of Realtors reported Wednesday sales of existing homes and condominiums in the Chicago metropolitan area dropped 15.6 percent in March from a year earlier, when tax credits revved up sales. It was the ninth straight month of year-over-year declines.

The median price fell 14.1 percent to $158,000 as foreclosures continued to weigh on the market.

Nationally, existing home sales dropped 6.3 percent to a seasonally adjusted annual rate of 5.1 million, the National Association of Realtors reported. The pace is far below the 6 million homes a year that economists say represents a healthy market. The median price fell 5.9 percent to $159,600.

New home construction dropped 13.3 percent last month from March 2010, the Commerce Department reported earlier this week.

“Housing starts remain at an extraordinarily depressed level,” said Dan Greenhaus, chief economic strategist at Miller Tabak Co. “To put this in further perspective, a doubling of (new homes) from here would still put starts at the lowest level of any other recession.”

Across the country, real estate agents are reporting a rise in traffic at open houses. But they say buyers are reluctant because of the shell-shock they suffered after the free-money machine blew up in everyone’s face. The foreclosure epidemic, the plague of employment insecurity, the fear that the U.S. is on a downward slide—they’re all playing into buyer commitment phobia, brokers say.

Worse news for sellers is that buyers don’t think the housing market has hit bottom, according to Truila.com. A recent survey by Trulia and Harris Interactive found that nearly 70 percent of renters who aspire to being homeowners say they will wait at least two years before buying. And nearly 60 percent say a housing recovery won’t come until after 2012.

“Many are reluctant to purchase a home even if they have the means because of the uncertainties in the economy,” says Celia Chen, a housing market analyst at Moody’s Analytics.

Contributing: AP with Francine Knowles

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