Here’s the latest reader question, along with my reply!
Lucretia asks: I listen to you on Bill Meyer. Love your attitude and knowledge. Question please: If you were wanting to buy a used SUV, what do you think of a 2013 KIA Sorento EX AWD for $14,800 with 70K miles? Do I need to worry about transmission problems or other concerns. The Lexus I bought from this dealership a few years ago dropped in value by half in just one year. Might I expect that with this KIA?
My reply: I checked out the ad you included with your question. As it turns out, I just helped sell a 2016 Sedona with 75,000 miles. A fair asking price for this vehicle is around $15k. The Sorento, being smaller – and older – shouldn’t be selling for more
So I think yours is overpriced. The problem is these dealers are charging an arm and a leg for used vehicles, generally. The reason being they can – because most people can’t afford to pay cash. So they finance from a dealer – and pay more.
We ended up unloading the 2016 to Carvana for just under $11k. Why? Because no one even came to look at the Sorento. Multiple ads (Craigs, Auto Trader). No replies. Not one. We had it at $13,500 – low in terms of fair market value. But no one has $13k in cash and so we ended up selling to Carvana, which will re-sell it for $15k-plus to someone else. Or rather, finance it for them.
If you can come up with the cash, I urge you to buy privately and shun the dealer mark-up. Especially because of the additional hit you’ll take on depreciation. The Sorento is a fine van – Kia mades fine vehicles – but these vans lose half their value in five years and it doesn’t get better after that. The four-year-old van I just gave away to Carvana for $11k sold for for more than $30k just four years ago.
On the upside, if you buy a used (depreciated) one for $11k or so and drive it for the next ten years or so, it’ll have been almost a free ride for you!
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