One of my good friends and long-time TTAC commenters asked me this question.
Hey Steve,
If you have a moment, what are the high and low values right now at auction for the following:
2000 Chevy Monte Carlo SS 40K miles gold/tan
2006 Mustang GT premium 27K maroon/tan
2006 G6 GTP folding hardtop 53k black/black
I could only give him one response and it wasn’t, “Go play darts and put some numbers together!”
The answer came in three simple words.
Condition, condition, condition.
Condition is the number one determinant of marketplace value when it comes to a used anything. A 30-year-old Jeep Cherokee? Could be worth $5,000 or $500. A 2013 Kia Forte? Pick any number between $4,000 and $10,000. Everything related to the used car business from old racing memorabilia to a near-new racing suit has condition as the keystone to value, with bullshit factor a close second.
This is why dealers try to make folks “buy with their eyes” by investing an awful lot of money into the cosmetic condition of used cars. Those used cars you see at Carmax and other large used car retailers are reconditioned by a small army of paintless dent repair technicians, detailers, and specialists who can handle virtually everything that is between the bumpers. They spend big money because you spend big money.
Condition is the king, queen, and jack of the car world. But there is a bigger psychological ace that you have to consider when it comes to buying a used car.
Risk tolerance.
Are you willing to buy a car with a salvage history? How about a car that doesn’t run at the moment? Forget about the possibility of knowing the answer to the unique problems for each scenario. The one irreversible roll of the dice every used car shopper and enthusiast must consider is where exactly they fall on the risk spectrum.
With that in mind, let me ask you the question I always have rolling in my head whenever I’m serving my customers, whether they are car dealers, old friends, or a new person in search of a used car.
What is your ‘sweet spot’ when it comes to a used car?
Let’s make this an à la carte process. I’m going to offer five categories: age, miles, cosmetic condition, mechanical condition, and title status. You tell me the riskiest one you would consider for a long-term daily commuter.
For example, my brother could handle a car from the early 2000s in average mechanical and cosmetic condition with a clean title and no more than 100,000 miles. Sajeev Mehta on the other hand would do cartwheels over a Reagan-era car that is no more than 150k, has moderate mechanical and cosmetic issues, and has a minor title issue such as a theft recovery.
Here are your five categories
Age
Obama Era (2008 or newer)
W Era (2001 – 2007)
Clinton Era (1993 – 2000)
Reagan/Bush Era (1981 – 1992)
Murilee Era (Jesus to 1980)
Mileage
Under 50k
50k to 100k
100k to 150k
150k to 250k
250k to Distance to the Moon
Cosmetic Condition
Extra Clean: Time capsule!
Clean: Garage kept and detailed by a diehard enthusiast.
Average: The usual assortment of small dings and dents; needs a little work.
Rough: Big dents, scuffs, and bumper stickers aplenty.
Extra Rough: Charity car, crusher fodder, or repo from hell.
Mechanical Condition
Amazing: An OCD owner who loves cars more than humans.
Very Good: Maintained by the book; a few late oil changes.
Average: Car needs a major service and minor repairs, but is in decent shape.
Below Average: Treated like a disposable appliance; needs a deeper dive.
Holy Hell: Car owned by a human hurricane; may be worth more dead than alive.
Title Status
Clean: No defects.
Minor Branded Title Issue: Court order, theft recovery, duplicate title.
Moderate Title Issue: True miles unknown, not actual miles.
Major Title Issue: Rebuilt/rebuildable, salvage, total loss.
No Title
Everyone has their own sweet spot where they are willing to go out on a limb to pursue a car worth keeping. What’s yours?
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