6 Tips For Buying A New Car In The UAE
Buying a new car in the UAE can be hard, especially if you’ve never been through the process before.
With around 60 different brands to choose from in the UAE and recent Facebook research revealing that most people only consider 3 brands to begin with it can be hard to know whether or not you’re making the right decision.
The used car market is a great place to look if you want to get the most bang for your buck, but there are a number of uncertainties and pitfalls which can be challenging to navigate (Read our article on how buying a new car can sometimes be cheaper than used).
The best way to avoid the uncertainties of the used car market is to buy new – but how affordable is it, and what about depreciation?
Read on to discover our 6 tips for buying a new car in the UAE.
Tip #1: Do your research
Decide on what’s most important to you – are you looking for the height and safety of a large SUV? Or perhaps the comfort and style of a luxury sedan?
Deciding on exactly what you want your next new car to have when buying a new car in the UAE allows you to start defining your choices.
Our handy search feature allows you to choose all of the things that are most important to you to help start your research.
Tip #2: Look, Touch, Feel
Just because a car matches your needs doesn’t mean that you will be happy with it.
Once you have narrowed your search down book a test drive to experience the car in the metal.
Sit inside, adjust the seat, think about how you will use the car on a daily basis. Are the cup holders large enough? Does it have handy storage compartments? How’s the visibility from your seat?
Most people will decide fairly quickly once they sit in a car if it’s right for them or not.
Try and take test drives for different cars on the same day to allow you to more easily compare how you feel in each one.
Tip #3: Secure your finance
A lot of new car purchases these days are made on finance. With low interest rates this can be an excellent way of levelling up to the perfect car for your lifestyle.
Knowing what to expect before beginning the finance process can help ensure you give yourself the best chance of approval.
For a list of car finance providers and everything you need to know about getting finance on a car in the UAE check out our advice here.
Tip #4: Don't be afraid to negotiate
With new car sales in a bit of a slump at the moment dealerships are eager to sell as many cars as possible.
Always ask what kind of deal the company is able to offer you to buy one of their cars instead of the competition.
They may not be able to take any money off the cost of the car but can possibly throw in extras such as extended servicing packages, free window tinting, or other products that add value to your purchase.
The dealership may offer you the choice of either a cash discount or an extended servicing package. Don’t be afraid to ask for the value of the servicing package and details of the servicing schedule so that you can make an informed decision.
If you’re not comfortable negotiating yourself then take a friend or family member who is willing to negotiate on your behalf.
Ensure to ask if they are expecting any sales or promotions to begin in the near future, or if they are selling any previous year models at a discount.
Tip #5: Depreciation matters, but so do your needs
Most cars will depreciate the moment you drive them out of the showroom. However, the rate of depreciation varies wildly from car to car, and is impacted by a number of factors – some of which mean that deprecation may not be as much of a concern as you might think.
Generally speaking, the cheaper the car is new, the less you will lose on depreciation.
New cars in the 30,000 – 100,000 Dhs price range represent excellent value as a 20% depreciation loss doesn’t translate to a huge amount of cash.
When this smaller loss is compared to the benefits you receive from owning a new car (such as warranty & service packages, and freebies such as insurance & registration) then a new car purchase becomes a lot more viable relative to buying used.
Most cars come with different levels of equipment – what we refer to as trim levels.
There may be a big difference in the price of a car with basic equipment compared to the version with full options. Our advice is to buy the one you need.
You won’t regret paying a little extra to get features you will use every day, but don’t fall into the trap of thinking that buying the top-spec model will significantly improve your resale – it won’t.
The used car market doesn’t often identify between trim level differences very well, so while you may be able to sell a top spec version more quickly, you won’t necessarily receive much more money for it.
See a real-world example below based on Drive Ninja research.
Low Spec
- New Price: 75,000
- Avg. Used Market Price (2 Years Old): 60,000
- Depreciation Loss: 20%
Mid Spec
- New Price: 90,000
- Avg. Used Market Price (2 Years Old): 63,000
- Depreciation Loss: 30%
Top Spec
- New Price: 115,000
- Avg. Used Market Price (2 Years Old): 68,000
- Depreciation Loss: 41%
Tip #6: Think of the long-term running costs
One of the most important questions to ask yourself when buying a new car is, “How long do I intend on owning this car for?”.
Combined with that, you need to consider what level of servicing costs you’re prepared to pay for.
Once you have made those decisions you should pay attention to the service contracts being offered (or not) by the dealerships to help you figure out how much you may need to pay in the coming years for servicing and maintenance.
If you’re only planning on owning a car for a couple of years and the vehicles you’re looking at come with a 2-year service contract then your cost of ownership over those 2 years will be negligible.
But if you’re planning on owning the car for 5 years and only have a 2-year service contract then the long-term cost of servicing is far more important.
As a general rule, European cars will be the most expensive to service and maintain in the UAE, followed by American cars, then Japanese cars, with Korean and Chinese brands being the cheapest to maintain.
We hope you found these 6 tips for buying a new car in the UAE helpful!
If you’re looking for more help and advice please feel free to contact us and we’ll help where we can.