You just immigrated to Canada and are looking for your own car for convenient transportation- from home to work, for dropping children to school, for market trips, or for longer road trips.

The most important decision you will need to make is whether to buy a new car or a used one. Actually, there is no right or wrong answer to this. Everyone’s need is different and so will be the decision. Before buying a car, you need to take into account the prices, financing, performance, requirements, insurance costs, etc.

Making a decision on this can be tricky and you need to look carefully at the pros and cons of both the options. However, bear in mind that buying a car is not an investment but a luxury, its value decreases over time.

Prices and Depreciation

Obviously, a used car will have a lower price than a brand-new car of the same model. However, even used cars can be expensive than a new one of different model, brand, and/or age.

A new car starts depreciating the minute you drive it off the lot. Your new car will lose most of its value in the first few years than in the later ones. If you plan to resell your new car down the line, you must keep depreciation in mind. On the other hand, you do not bear the depreciation menace with a used car and you can resell it pretty much around the same value at which you bought it.

Warranty

Nothing matches the new car warranties you get from the manufacturer. In case your car ever requires a major repair, in the warranty period, it will be taken care of. New cars are less prone to developing faults in the first one or two years, so you do not have to worry about your car breaking down in the middle of the road.

Generally, the warranty period is expired for a used car that is, you will have to pay for any repair or maintenance that it might require. There is a risk of ending up paying more to take care of a used car than a new one. Though you have the option to purchase some warranty coverage, from some dealers, however, it does not last long and almost nothing as compared to Original Equipment Manufacturer warranties.

Insurance Rates

This is another important thing to consider before you buy a car in Canada. Insurance rates depend on the age of a car and its value, thus, used cars are generally cheaper to insure as they are old and usually less expensive.

In many cases, a used car requires only collision coverage, whereas a more comprehensive coverage is needed for a new car. Also, an expensive car needs more coverage, that is, a costlier policy. However, sometimes a used car may be expensive to insure than a new one, especially if it is a model that is more likely to get stolen.

Loans and Leases

Most Canadians go for loans to pay for a car. The average length for loans is around 5 years but you can pay back sooner. It is easier to save for a used car as it is cheaper, you can even pay in cash for it without getting a loan. If you go for a loan also, the monthly payments for a used car will be lesser than a new one, and you can pay back faster which in turn means less amount of total interest paid.

Dealers offer different kinds of deals on new cars and if you manage to get a good deal the interest rate for a new car can be a lot less than for a used one.

Leasing a vehicle means you do not actually own it; you are renting it. After the lease gets over you either have to buy the car or walk away from it. Now, monthly lease payments are less than that of loans if you were to buy the same car. In this option, you have the benefit of starting a new lease every few years on another car.

New vehicle leases are more common than used ones. Leasing a used car can be a good option for you as it will already have been depreciated, and your monthly lease payments will be a lot less than if you lease a new car of the same make and model.

Performance, Technology and Features

Indeed, new cars rate better on the scale of performance and efficiency. Since technology is ever-evolving, manufacturers keep improving the performance of new vehicles in terms of- fuel efficiency, making lighter vehicles, generating more energy from smaller engines, etc. Used vehicles are not up to the mark in performance and fuel economy.

New cars are always up to date, have the latest features, and come with integrated infotainment systems. However, used cars are only as advanced as cars were made at the time they were manufactured.

Safety

In recent years, a lot of advancements have been made in vehicle safety, especially with the evolution of artificial intelligence. New cars have many safety features that act faster than you as a driver in certain situations- emergency braking, alerting you to something in blind spots, warning you when you are going out of the lane, etc.

New cars are always stronger and safer than the old ones, especially in an adverse situation.