[financypants]

The small and quasi-loophole to getting a good used car deal is buying a hail damage car. I genuinely don't understand why cars were made to have shiny paint. Cars drive on dirty roads with insects and pebbles abound. Paint doesn't matter. Car washes are crazy, except to abait rust

[lostlogin]

It’s a lot easier to clean a shiny surface than a matt one.

Try clean a house ceiling versus a house wall - though anyone sane wouldn’t paint a ceiling matt, or for that matter, even contemplate painting a ceiling.

Get a painter to paint it semi-gloss.

[ggm-at-algebras]

Confirmation bias but a very good friend did this: bought back the hail damaged car from the insurer in preference to keeping the undamaged VW Beetle, sold the beetle, has been driving the hail damaged car with the minimum legal insurance to third parties for 15 years since. She's streets ahead in costs of car ownership and drives long and short distance, urban and country.

[leakycap]

The issue you'll face is when you go to sell it – any noticeable hail damage means you are getting 1/2 the resale value if you can even find an interested buyer.

[bigstrat2003]

Ideally you should be driving the car until the wheels fall off anyways. Faffing about selling cars and buying newer ones is a waste of money.

[dagw]

Driving a car until the wheels fall off generally doesn't make financial sense. Keeping an old car on the road gets really expensive unless you have the space, time and skills to do all the work yourself. Then there is the opportunity cost of not having access to your car for days/weeks at a time while it is being repaired. Finally you have the stress of not being quite sure if your car will start when you turn the key or get you where you want to go.

From both an economic and quality of life point of view, you are better driving your car until it starts to get slightly unreliable and then quickly trade it in for a slightly newer used car. Buy a 5-10 year old car, drive it for 5-10 years, then trade it in for a 5-10 years old car is probably pretty close to an optimal strategy.

[leakycap]

Same with technology. If you aren't rich, selling around the time the next model comes out is actually a great way to avoid paying full price for your modern tech.

With Apple stuff, waiting more than 1-2 cycles means you've missed the ability to recoup most of your costs AND you got to use an old device for an extra year... yay?

[lotsofpulp]

More like extra 2 or 3 years, so yes, yay. Consumption is consumption, you don't get things for free.

If the phone only lasted 1 more year, then the resale price of the phone would reflect that. Either the collective market of buyers lacks the information to evaluate this (doubt), or you got lucky finding the one buyer willing to overpay.

You also always pay full price, because when you buy a new phone (or anything), you always have the option to buy the used or keep using the old one. Cost is opportunity cost, which is defined as your choice minus your second best choice.

[leakycap]

> Consumption is consumption, you don't get things for free.

While this is true, desirability in the used market doesn't work linearly. Apple devices fall off quickly in value after 2 years. If you buy early in the product cycle, selling as soon as you can buy the next year's model has proven to be the most economic way, because resale on last year's model is still great but 2 years ago is in the tank.

I've been upgrading yearly since 2007 and my spouse waits 3-5 years between phones. Doing the math, over the years I've spent less overall because of the value of sales when I trade up vs. their phone was worth sub-$200 when I sold it recently, because it was older than a few years.

[lostlogin]

Does a Toyota Corolla ever get unreliable or uneconomic to repair?

[potato3732842]

Yes.

Prices are all jacked up vs what you get because a historical surplus of very well kept cars on the used market has lead to every idiot on the internet being told they're somehow magical.

A badge on the grill doesn't make 100k the of uber miles that the 3rd owner put on or being habitually driven low on some key fluid by the 4th owner any less destructive.

[lostlogin]

I ran a Corolla with a holed sump, and no measurable oil. I was going to scrap it.

After 3 months it was going ok so took it to a mechanic. They repaired it, said ‘don’t do that’ and it carried on for another 5 years before I sold it.

[leakycap]

> Faffing about selling cars and buying newer ones is a waste of money.

Depends. No reason to pour money into a depreciating asset that you trust your life with.

I saw an early 2000s small car get into a ~30mph collision recently and ... I wouldn't drive an early 2000s car after that. A lot of people do, and they probably should try to get something with more modern safety equipment.

[harvey9]

That's accounted for at the time they bought it since it was already hail damaged.

[leakycap]

Is it savings if you buy an item worth less and you pay less? You're just buying a damaged item at that point ... which is worth less to everyone

That isn't getting "deal" unless you plan to never liquidate... cars generally don't get used up like a can of soda, so the dent actually matters when you go to sell it.

[lelanthran]

> That isn't getting "deal" unless you plan to never liquidate... cars generally don't get used up like a can of soda, so the dent actually matters when you go to sell it.

Yes, but it mattered already when you bought it!

In other words, the dents were already priced in when you paid for it, so you paid less. They'll like be priced even lower when you sell it after 5 years of usage.

[leakycap]

Almost all buyers finance.

You cannot generally get a loan on a car with much hail damage. Buyer pool now significantly smaller = less value, must sell for less to attract one of the few potential buyers.

This means for most people trying to unload their hail damaged car, they get to sell to dealer at auction pricing (aka rock bottom prices, penny on the dollar value), sell it to an auction yourself, or hope someone on CraigsList is desperate for a car enough they don't care it's a golf ball.

It's interesting how something like this might be hard to understand if you haven't been through it. Previously working in the car industry, not understanding this is actually common among car buyers and a source of frustration for people who get stuck in their low-value, hail damaged cars.

Think about something other than a car: If I buy something that is normally worth X, but it is damaged and is now worth 0.3X and there I pay 0.3X I did not save 0.7X off what I got... I got something worth what I paid.

You cannot extract value from a deal where you were paying less because you received less (aka damaged and less valuable property with less market value).

[lelanthran]

TLDR: When you buy a hail-damaged car, you get a discount. When you sell a hail damaged car you give a discount. The discount you give is always lower than the discount you get, hence you come out ahead in dollar values.

------------------------------------------------

I get all that (and will address specific comments below), but first, look at it this way:

1. The selling price of the car without hail damage at 3 years old is `$X`.

2. The selling price of the car with hail damage at 3 years old is `$X - $Y`, where `-$Y` is the value of the hail damage (hence it is negative).

3. The selling price of the car with hail damage at 9 years old is `$X - $Y - $Z`, where `-$Z` is the value of the depreciation (also why it is negative).

Since the car selling price never gets to zero or below AND $Z flattens out over time, $Y must also flatten out over time! IOW it is also asymptotic.

This means that the discount of buying a hail-damaged car (the `-$Y`) is large for a new car and small for an old car.

In practical terms, in the context of buying, using and then selling a hail-damaged car:

1. You buy a $30k car and get a discount of (say) $10k due to hail damage.

2. Six years and many miles later that car, which might have sold for $10k without hail damage, will now sell for only $7k.

You got a discount of $10k and only gave a discount of $3k. You're $7k up.

> If I buy something that is normally worth X, but it is damaged and is now worth 0.3X and there I pay 0.3X I did not save 0.7X off what I got... I got something worth what I paid.

You are conflating `value in market` and `value of utility`. Whatever you are paying for a product, you pay that only because the value you get from the that product is greater than the amount of money you are paying.

Hail damage does not reduce the utility value of a car by even a single cent. It will transport your cargo and passengers exactly the same and with exactly the same levels of safety, comfort and reliability that its non-hail-damaged counterpart would.

The utility of a hail-damaged car is exactly the same as the utility of its undamaged counterpart. The difference in price between a hail damaged car and its undamaged counterpart is the exact monetary value placed by the market on "how pretty is it?"

[mlyle]

Yes, but you also paid half the cost to acquire the car. You're just paying less in depreciation for the time you use it.

[leakycap]

My last car got minor hail damage across many panels, it was a difficult PDR for some reason - when I traded it in it was worth 1/4 what KBB would have been for a similar year and mileage without dents

Even trying to sell it myself for around 1/3 KBB "good" value took 2 months because the next buyer can't get financing on a car worth very little, so you have to find a cash buyer who doesn't care how their new ride looks. It's rare for anything other than $2,500 cars

[lelanthran]

> next buyer can't get financing on a car worth very little, so you have to find a cash buyer who doesn't care how their new ride looks.

The idea is to be the next buyer who is paying very little because of the hail damage.

[gloxkiqcza]

People are rarely this pragmatic but I agree! Slightly beat up cars for the win!