Buying your First Car

Getting your driver’s license and buying your first car have long been a right of passage in Australia. Having a car of your own means freedom and best of all – no more public transport.

Here’s a guide that all new drivers can use to make the best decision you can before buying a new car.


The key buying decision for most first time car owners is price. Once you’ve set your budget, you can start looking around for the make and model that really want. When it comes to price there are a few areas where you can find a great deal.

If you’re going to be buying your car from a dealer then you can expect to pay more. If you buy a second hand car from a new car dealer then you can expect to pay a premium.

However new car dealers generally only stock the very best quality second hand cars. They are often traded in from people buying a new car.

If you are looking for a car under $10,000, then you’re next option might be to look at second hand car dealers. The advantage to buying a car directly from a dealer is that they come with a mandatory three month warranty. So should there be any issues, they are legally obligated to repair them.

If you’re looking to save money then the cheapest option is to buy a car privately. However when you buy a car directly off someone, they are under no obligation to give you any kind of warranty. So if you you run into mechanical issues, then those repair costs fall back on you.

If you go down the path of buying a car privately you can expect to pay around $2000 less than you would with a dealer.

Vehicle Inspection

A great tip to make sure you’re not only getting a bargain but also one that’s in great mechanical shape is to get it inspected by a third party. You have the option of taking the car to a mechanic. However there are also services that will come to you give the car a thorough inspection to make sure you’re getting what you paid for.

Manual vs Automatic

As a general rule, cars with manual transmission are significantly cheaper than automatics. If you’re on a budget consider a manual. You have the potential to save around $2000 for the convenience of not having to change gears.


One of the hidden costs of buying a car is registration. Often times sellers look to offload their car prior to paying next year’s vehicle registration.

Registration costs vary from state to state but can be upward of $1000 per year, so if you’re buying a car priced below $5000, then look to save money by purchasing a car with at least nine months of registration.

CTP Insurance

Compulsory Third Party Insurance or CTP is mandatory and provides compensation should a person be killed or injured in a crash. In most states CTP is included as a part of the registration, however in NSW you need to purchase it separately. In NSW this can add a few hundred dollars a year to the costs of running your car.


If you’re under the age of 25 then you will be faced with significant insurance costs. As a young driver you should expect to pay around $2000-2500 per year in insurance costs. This can be significant compared to the value of the car itself and needs to be considered prior to buying a car.

Tips to reduce insurance costs

  • You have the potential to reduce your insurance costs by comparing different car insurance providers.
  • Consider bundling your insurance on a family policy.
  • Increase the levels of excess if you’re more experienced.

Car Insurance Insider

Works behind the scenes to ensure Australian drivers are aware of car insurance offers and revealing those secrets to cheaper car insurance.

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