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Joe Kenwright23 Jan 2007
REVIEW

Used Car Buying Guide: $5000 Small and First Car Bargains

A near-record year of new car sales has generated a surplus of older trade-ins that most dealers just don't want. CarPoint explains which 'cheapies' are currently smart buying

It's that time of the year when tertiary offers, new jobs and house/flat moves can generate a rush for cheap cars.

Fortunately, in most states of Australia, a near-record year of new car sales has generated a surplus of older trade-ins -- many that dealers just don't want.

If you are an experienced driver, and you're buying a car for yourself, you might like to skip the next few paragraphs. If you are buying a first car for a young driver then perhaps consider that this purchase may be the last time that you will have any real influence over what he or she does on the road and whether the vehicle in question gets looked after.

After buying hundreds of first cars for young drivers, I have watched too many cars weeks in the finding reduced to wrecks within a short period of time.

Before I begin the search for a used car for young drivers I make sure the guidelines below are considered:

>> If you are going to be called out to give a young driver's neglected flat battery a jump start, buy a set of surge-protected jumper leads now. I have lost track of the number of parents whose new cars have suddenly developed costly electronics failures that no one wants to know about after jump starting an old car. You wouldn't feed a dead short into your home computer, don't do it to your car.

>> Do not let the fuel tank slip below a quarter full in any car with fuel-injection. The fuel in the tank is critical to keep up to $2000 worth of pumps and injectors cool but if there is not enough cool fuel in the tank, they overheat and die.

>> If you want a first car to be looked after, make sure the driver has a substantial financial stake in it. If you treat a car purchase like a disposable iPod or pair of running shoes, why expect a young driver to treat it any differently?

>> Buying a prestige model to increase safety might seem like a good idea but only if the novice driver is earning the $100k of the original owner to keep up the maintenance. It is unrealistic to set up a young driver with an expensive car then expect them to keep up with the top-shelf maintenance. If you insist on going down this track, be prepared to subsidise repairs otherwise you won't be told when something is wrong until it dies and is towed back home as scrap. All those old Saabs, Volvos, BMWs and Mercedes-Benzes sinking into suburban backyards while their P-plate drivers zip around in Hyundais have a story to tell!

>> Think twice before you lie about the ownership of a car that would normally be uninsurable for a novice driver or covering it under your own insurance. This can be misinterpreted by some young drivers that their parents are prepared to cover whatever they do on the road. In a classic case of reaping what you sow, this is one area where your worst nightmares might only be the starting point.

>> Young drivers can be expert at playing one parent against another to get them to fund whatever they want, not necessarily what they need. Even if you haven't talked to a previous partner for years, this is one area where a united front might make the difference between life and death.

>> Given that it takes some novice drivers at least one crash to reassess priorities, consider assisting in the purchase of a cheaper car as a first car then offer a greater subsidy for a car of their choice later, on the condition that they achieve their own insurance record, that the first car is still worth something and they have also saved for the next purchase. All parties have a win in this situation. Too often the alternative is an expensive car purchased first-up which is written-off soon after.

And consider, given the 'pressure' of obtaining first car before the university or college year begins, if you can spread your search into March (when new car buyers are also back at work and buying again), your choice of cheapie can increase dramatically….

The $5000 Small and First Car Choices   
LIGHT CARS
This relatively new category below the traditional small cars has now been around long enough to deliver several reliable, frugal and now cheap runabouts.

Most are short on crash safety which is not such a big issue if they don't leave town. More importantly for urban use, they don't offer any significant crash protection for rear seat passengers.

Treat them as a one or two person runabout and save on those that only have two doors when most family second-car buyers reject these.

The model year is not a big issue when distance travelled and a good service history is far more relevant at this price.

Daewoo Lanos: A disposable Korean Barina alternative with an engine that will keep going. Even if the rest is ordinary, it looks good and if kept in good order should always find a home.

Daewoo Matiz: It looks like a golf buggy and drives like one. Frugal and cheap but best only for very short trips. Some costly electronics failures.

Daihatsu Charade: Always a good buy if looked after even if crash safety and driving experience are basic.

Daihatsu Pyzar: Oddball made for a cheap commuter role with few problems providing you can see past the looks.

Hyundai Excel: Cheap, disposable and some now bordering on junk but the well-maintained ones have the potential to provide low cost transport for a year or two.

Holden Barina: Pre-July 1997 models are agonisingly slow but the 60kW update from August 1997 is a winner even if the aircon was a dud from new.

Ford Festiva: Korean version of Mazda 121 is a cheap no-frills car that had some style after 1994 but not all offer power steering or aircon. Like the Excel, too many components don't last big distances but the low mileage gems are worth considering.

Mazda 121: The only four-door sedan in this category but it hates being hit up the back and most will have water leaks and boot rust if disturbed. Great quality from 1990 suffered from 1994 as Mazda cut costs dramatically. Later 1.5 models are the pick.

Mitsubishi Mirage: Probably the best buy in this category. Shared its front half with the larger Lancer. Early examples with grey bumpers and no power steering are cheaper.

Nissan Micra: Outstanding car now forgotten as an orphan. Has a tendency to throw its timing chain for big engine repair costs down the track but anticipate this and it could be a bargain.

Suzuki Baleno: Fabulous little hatch which, like the Mirage, shares its front half with a larger sedan and wagon. Forgotten but reliable and long-lived.

Toyota Starlet: Cheap and sometimes nasty little car after Toyota directed all the purchase price to a long-lived drivetrain which in Toyota-style will keep going as the rest falls apart.

Toyota Paseo: Another little horror that shares the underpinnings of an earlier Starlet not seen here. As forgotten cheap transport for two, it is worth a look.

SMALL CARS
This is still where the action is. While prices have eased, some are still inflated relative to today's replacement cost. The best value is often found in the least popular body choice where the important running gear is still the same.

Shopping under $5000 means you are buying on condition, maintenance history and distance travelled. Factors such as colour, body style and transmission have to take a lower priority when registration and a good set of tyres accounts for 20 per cent of the purchase price!

Chrysler Neon: A half-reasonable US attempt to beat the Koreans and Japanese at their own game. Overlooked, there are some well-kept gems out there for not much. Avoid neglected examples as cheap parts and repairers are thin on the ground.

Daewoo Nubira: Aussie Holden engines will usually keep going as the rest falls apart and the main bits shouldn't cost a fortune. Reasonable looks and a better drive than most but a good service history is vital with the Family II engine.

Daihatsu Applause: Providing it is not worn out, the Applause is an underestimated jewel of a car with one of the best reliability records in the business. Look for good maintenance records if it is old even with low ks.

Ford Laser: Hugely popular used choice means you will be looking at the last of the locally made 1992-94 KHII models which are roomy but not very safe. Later imported KJ series just sneaks in if it doesn't have aircon and is a manual.

Holden Nova: Best way to buy the legendary Aussie-built Corolla at a lower price without anyone knowing. The last of the smaller LF series and the first of the larger LG series (from October 1994) are just creeping into this price range.

Honda Civic: The last of the 1993-95 Civic fifth generation as a three-door hatch or four-door sedan can be superb little cars providing they are not thrashed. They don't like skipping services or being belted over rough roads. Its earlier Concerto offshoot can provide similar mechanicals and size in a five-door hatch body.

Hyundai Lantra: Offering extra substance over the Excel, they are still cheaper and flimsier than the benchmarks in this category hence a good history is more important than most.

Kia Mentor: Recycled Korean-built 1980s Mazda 323 is dated with some very cheap finish in places but a good, low mileage example could do the job well for this sort of money.

Mazda 323: Another hugely popular choice which means that the best buys at this price are pre-1994 with low mileage and a good history. Choose between a swish Astina hatch or classy sedan. Not all have aircon.

Mitsubishi Lancer: There is a great range of early coupes, sedans and hatchbacks which are top buying if looked after. Both the manual and auto transmissions of the earliest examples are not as durable as the best in this class.

Nissan Pulsar: The 1991-95 N14 series as a hatch and sedan was a top model. It was locally built until early 1993, fully imported after that so there is a good range of parts.

Subaru Impreza LX: The very first front-drive base models are slipping into this price range. A long way short of later AWD models, they have a strong body, quality finish but tend to ping if run on base unleaded.

Toyota Corolla: Legend status means everyone is chasing the best of the post-September 1994 models which were the last built in Australia with longlife paint and trim and cheaper parts. If you want aircon and auto, you might have to settle for a sedan at this price. The previous series was just as good, a little easier to drive and at Seca level, still looks sharp so extend your search to an 1989-94 model if you want auto, aircon and power steering with low ks.

FAULTS THAT CAN BREAK YOU
Driveshafts: Allow $500-plus for split boots or joints that click during cornering.

Blown head-gasket: Allow up to $600-plus if you miss this one. Filthy coolant, perished hoses and overheating engine paint a dim outlook. The lightweight blocks and heads of some small engines can be eaten right through with corrosion if the coolant isn't changed on schedule.

Sludged engine blocks and heads: Some small car engines are so badly sludged from missed oil changes that the engine cannot be repaired and has to be thrown away.

Split radiators: Plastic header tanks that weep with alloy cores that crumble away can be a $350 repair depending on changeover availability.

Oil leaks: Depending on where and how, they can sometimes dictate replacement of fuel pumps and other ancillaries to fix.

Brake master-cylinder and hydraulics: Forgotten fluid changes can generate up to $2000 worth of repairs by the time you replace leaky master and wheel cylinders, caliper seals and sodden brake linings and wheel bearings. The same goes for hydraulic clutch circuits.

Exhaust: Split or cheaply-repaired engine pipes or broken manifold studs usually indicate engine mounts that are on the way out. Allow up to $350-plus.

Uneven panel gaps, water leaks and poor crash repairs: Usually not worth fixing at any price otherwise they would have been rectified. Don't be the bunny where a seller has decided better your problem than theirs.

Failed instruments and accessories: Anything around the dash is costly when accessing it is fiddly and time-consuming. Most dud sound systems are throw-away items when no one wants to repair them.

Non-operational aircon: If it is past a simple re-gas, you could be paying up to $1200 for an R134a conversion that might require a new compressor, hoses, condenser or receiver-drier. Watch sellers who have costed it and decided that selling the car is a cheaper option. Also watch out for heater cores that have been blanked off to avoid replacement.

Dodgy engine electronics: Most late model small cars have computers and other control units mounted too close to hot engine parts for Australian conditions. Treat any oddball engine behaviour as suspicious as some integrated electronic units leave little change out of $1000.

Noisy fuel pumps: Overheated fuel pumps can be labour-intensive to replace when they are usually inside the fuel tank. Allow $600-plus.

Dodgy transmissions: Tired, juddery or slippery clutches allow up to $700 and if a manual gearbox is notchy or noisy, check on the price and availability of a secondhand one. A tired auto on most modern cars can cost $1750-3000 to fix depending on make or model.

Timing belts: Most small cars must have their timing belts changed every 80-100,000km or risk terminal engine damage. Allow $300-plus if there is no evidence that it has been done. On those models where the timing belt drives the water pump, allow for water pump replacement as a fresh, tight new belt will usually cause an old water pump to fail.

Tyres: They might be roadworthy but if they are all different, your chances of pulling up in a straight line in the wet are slim. Missing genuine part wheelcovers can cost $80-plus each to replace.

Head and taillights: Dodgy imitation lights might get the car out the door but you will be left with holding the baby if they fade, leak, corrode or set the car on fire when they melt. Factory taillights can start at $100 while some headlights can cost $300 each.

Missing or broken parcel shelves: Believe it or not, these are quite expensive for most hatchbacks and are no longer available in many cases.

Broken steering-wheel rims: A combination of sunlight and nervous drivers leaves many cars with steering wheel rims that have broken away from their internal frames for a really dodgy steering feel. Not all repairs are successful and they can be pricey if you have to buy new.

Worn valve guides or stem seals: Not always picked up in a roadworthy check, these can get you 'defected' as they cause the engine to blow clouds of smoke after a long period at the lights. On their own, they can be a $600 head-off job. They should be replaced as a matter of course if the engine has been overheated as they go hard and stop sealing but some repairers cut corners to trim the bill.

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Written byJoe Kenwright
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