Best new cars under $20,000

Why pay more than you need to for a new car?

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Looking for a new car under $20,000? This guide will help you find what's available within your budget, for less than $20k, driveaway.

Cars under $20,000

Which are the best new cars under $20,000?

At this price point, your choice of cars is somewhat limited. There's still a selection of different models on sale though. There's a ute, a van, a small crossover type SUV and plenty of hatchbacks. Check below to see how you could stretch your budget further.

ManufacturerModelPriceReview
Fiat263 Doblo van (2018 Build)From $19,990 driveaway (Price from a dealer)
Great WallSteed 4x2 dieselFrom $19,990 driveaway (Price from Great Wall)
HondaCity VTiFrom $19,550 (Price from Autotrader)
HondaJazz VTiFrom $19,305 (Price from Carsales)
KiaPicanto SFrom $16,990 (from Kia)Read Review
KiaCeratoFrom $19,490Read Review
KiaRio SFrom $19,490 (driveaway from Kia)
MGMG3From $16,690 (MG driveaway)
MitsubishiMirageFrom $16,990 (Carsales)
SkodaFabia AmbitionFrom $17,990 driveaway (Skoda)
SuzukiBalenoFrom $16,990 (Suzuki website)
SuzukiIgnisFrom $18,990 (Suzuki estimated driveaway)
SuzukiSwiftFrom $18,990 (Suzuki estimate driveaway)Read Review
VolkswagenPoloFrom $19,990

What features should I look for in a new car under $20,000?

When you're buying a car on a budget it's still important to know which features you want from the outset. Here are some items to look out for when you head to the dealership:

  • A 5-star ANCAP rating. Make sure the vehicle you're purchasing is rated highly by Australia's vehicle safety rating agency, ANCAP. Find out more about these ratings here. Some of the models in the above list did not receive the highest possible ANCAP rating.
  • Parking sensors or a reverse camera. A lot of new vehicles come with either reversing parking sensors or a camera (or even both) installed. These features help you spot unseen obstacles and back into spaces you might otherwise have been unable to park in. They are most useful in tight multi-storey car parks.
  • Bluetooth®, Apple CarPlay and Android Auto. If a car has Bluetooth® phone connectivity, this will make your journeys pass quicker and reduce the hassle of getting where you want to go. Apple CarPlay and Android Auto are particularly useful, as they extend your smartphone's UI onto the car's infotainment system, allowing you to use apps like Spotify and Google Maps natively. As a bonus, if you have a compatible phone, then you don't need to go for a trim which has sat-nav built-in by default.
  • Satellite navigation. Sat-nav is a nice feature to have, but if you have Apple CarPlay or Android Auto, you don't especially need it.
  • AUX/USB input. It's such a small component, that probably costs car makers a few cents to install, but it'll transform a budget-spec model. Now, you can hook your phone up to the car using an auxiliary cable or USB plug and play your music or navigation instructions through the sound system.
  • Warranty Part of a new car's attraction is getting a long warranty to cover you for premature mechanical failures and faults. The longer the warranty, the more peace of mind you have. Some of the sub-$20 grand cars on our list have five years, unlimited-kilometre factory warranties. Right now, Mitsubishi is running a promo where you'll get Diamond Advantage - which extends the warranty period to 10 years (or 200,000km)!
  • Excellent reviews. Don't buy a car based purely on its purchase price! Make sure you check out as many car reviews of that specific model as you can! Also, take time to read the experiences of verified owners who have put tens of thousands of kilometres on their models. Also, you should visit Product Safety Australia to see if the car manufacturer has published any recalls for the vehicle you're interested in.
  • Low maintenance & running costs. To avoid buying a cheap car, then getting hit with high maintenance costs, check out the prices of servicing before you sign the contract. Most car brands will offer multi-year servicing packages, which may work out cheaper in the long run. If you know a mechanic, ask them what parts prices and availability is like for the car you're researching. You can use websites like the Green Vehicle Guide to estimate annual fuel bills.

How can I save at a dealership?

Here's how to make your $20,000 budget stretch even further, perhaps even getting you into a higher-spec model.
  • Use a car buying service. Once you know which model you want, use a car buying service to help you access fleet-level pricing. On average, these services saved their customers over $4,500!
  • Shop around for offers. To find the best $20,000 car deal around, you're going to need to do some digging. We found some great deals when we looked through the offers pages on car maker's websites. Trawl through the car sales sites and consider out of state dealers. They might be able to deliver the car, all for a keen price.
  • Stick to the rule of three. If you're buying in person. visit at least three dealerships before making your purchase. That way, you'll be able to play the dealerships' offers against each other and have leverage when negotiating. It helps to have found some similar cars you've found online too, so you can show the dealer what you're expecting and see if they will price match.
  • Avoid unnecessary insurance add-ons. A report from the Australian Securities and Investment Commission (ASIC) found that many insurance plans sold by car dealers weren't valuable to consumers, so be careful what you sign up for. Types of insurance to question if they are offered include tyre insurance and loan protection insurance.
  • Get the timing right. There are a few schools of thought here. One is that you should visit at the end of the month when dealerships are trying to hit their sales targets. Another is that you should visit on a Monday or Tuesday when dealerships are less busy and there's more time to negotiate. One well-known time to snap up a bargain is the End of Financial Year Sales, as dealerships offer specials to reach their EOFY goals. A final tip around timing is to wait until a dealership is having a model runout sale, when the current generation of a vehicle is about to be replaced by an updated version. Dealerships try to clear out the older stock to make way for the new build and may be more willing to strike a bargain.
  • Come down a level. Higher trim grades, with all their cushy passenger comforts and extra tech are tempting. But lower specification levels are cheaper. If you can live without fancy things like leather upholstery and large alloy wheels, you could save thousands of dollars. That might just make a car that you thought was out of your $20,000 price range, easily affordable.
  • Ditch the options. Another way dealers make money is by up-selling the optional extras. These quickly add up, inflating the purchase price of a car. One of the biggest sellers is metallic paint, which usually costs around the $500 mark. If you're willing to go for one of the limited free paint colours, you could save money. The downside is you may only have the choice of one or two colours (very often, plain white is a free paint finish).
  • Shop around for finance. By shopping around and comparing deals from multiple car loan lenders, you could save hundreds of dollars over a car finance agreement.
  • Buy a demo or nearly new car. Buying a dealer demo (a car the dealer used for test drives) or a model that's around a year old, could save you quite a bit of cash. As a plus, you let someone else foot the bill for the first year's depreciation. With demo cars, in particular, dealers often spec these out to a decent standard, so you could get a higher trim, for less outlay.
  • Negotiate. Finally, negotiating with a dealer could save you money, or get you some nice freebies thrown in. Even if a dealer won't agree to a lower price, you could ask them to chip in metallic paint, or even just a full tank of fuel, as a little cherry on top.

What are cheap cars like to drive and own?

Skoda Fabia hatch

It really depends on the make and model. If you go for a sub $20k Skoda Fabia for example, it's going to have a small 1.0-litre petrol engine, with 70kW. That means it's not going to be super speedy, but for around town driving, it should prove pretty economical, using 4.5L/100km combined. You'll get a five-speed manual transmission. Nothing special there. But the spec is reasonable, with the choice of two free solid colours (white or red) and stylish-looking, 15-inch steel wheels. The Fabia Ambition also has:

  • Adaptive Cruise Control
  • Apply CarPlay & Android Auto
  • Front Assist with City Emergency Braking
  • Rear View Camera
  • 6.5-inch infotainment touchscreen
  • Leather steering wheel with multi-function
  • Sound package
  • Start-stop system, with regenerative braking
  • Umbrella
  • Cloth seats

Overall, it's not a bad specification. Plus, Skoda has a reputation for high build quality. The cabin, according to a car reviewer is a bit "plastic fantastic", though at this price point competing models will be just as plastic reliant. You can kind of think of it like a budget VW Polo, thanks to Skoda being one of the Volkswagen Group subsidiary companies.

Comparing this model against the MG3, which is a cheaper car. On the MG3, you get a 1.5-litre petrol engine, with a four-speed automatic transmission. This car gets an 8-inch infotainment touchscreen, 15-inch alloy wheels, plus a four-speaker audio sound system with something called Front Yamaha Sound Field. The seats are Tartan-inspired fabric. MG offers three free paint options: yellow, white and black(one more than the Fabia). In summary, you get a bit more "bling" for your money. It doesn't have things like Adaptive Cruise like the Fabia has though. Fuel use is higher, at a claimed 6.7L/100km combined. The MG3 has a longer, seven-year (instead of five-year), unlimited-kilometre warranty. A car journalist stated the MG3's engine was a bit soulless, without any life.

Additionally, the MG3 has a three-star crash rating (from the Euro NCAP), where the Skoda Fabia has a five-star rating (from ANCAP).

In summary, at this price point, cars aren't going to be luxurious and cushy, but they do have some surprising creature comforts.

Car loans you can use to purchase a vehicle under $20k

By entering your desired loan amount and term below, you will be able to see how much your monthly repayments on certain car loans. But the savings don't have to stop here. You can also compare car insurance and whether you are looking for comprehensive car insurance, third party fire and theft or just CTP insurance, we have a number of comparisons and comrephensive guides that should be able to help you make a decision.

Data indicated here is updated regularly
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Monthly Repayment View Details CTA
Loans.com.au - New and Dealer Used Car Loan
From
4.67%
(fixed)
5.22%
You'll receive a fixed rate from 4.67% p.a. based on your risk profile
Finance a new car and benefit from features such as fast approval, no ongoing fees and an optional balloon payment. Settle the loan before 30 November 2021 and enter the draw to win a $1,000 fuel gift voucher. T&Cs apply.
You'll receive a fixed rate from 4.67% p.a. based on your risk profile
Finance a new car and benefit from features such as fast approval, no ongoing fees and an optional balloon payment. Settle the loan before 30 November 2021 and enter the draw to win a $1,000 fuel gift voucher. T&Cs apply.
IMB New Car Loan
4.99%
(fixed)
5.34%
You'll receive a fixed rate of 4.99% p.a.
A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one that's up to two years old.
You'll receive a fixed rate of 4.99% p.a.
A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one that's up to two years old.
Latitude Personal Loan (Secured)
From
5.99%
(fixed)
7.26%
You'll receive a fixed rate between 5.99% p.a. and 21.99% p.a. based on your risk profile
Lock in a competitive fixed rate when you offer security. Loan can be used for any purpose and repayments are flexible. You can check your interest rate before applying with no impact to your credit score.
You'll receive a fixed rate between 5.99% p.a. and 21.99% p.a. based on your risk profile
Lock in a competitive fixed rate when you offer security. Loan can be used for any purpose and repayments are flexible. You can check your interest rate before applying with no impact to your credit score.
Plenti Car Loan
From
4.89%
(fixed)
5.44%
You'll receive a fixed rate from 4.89% p.a.
Borrow up to $100,000 with a Plenti Car Loan and benefit from no early repayment or exit fees.
You'll receive a fixed rate from 4.89% p.a.
Borrow up to $100,000 with a Plenti Car Loan and benefit from no early repayment or exit fees.
Credit Concierge Car Loan
From
3.99%
(fixed)
5.08%
You'll receive a fixed rate of 3.99% p.a. with a comparison rate of 5.08% p.a.
Get access to over 20 providers to fund a new or used car.

You'll receive a fixed rate of 3.99% p.a. with a comparison rate of 5.08% p.a.
Get access to over 20 providers to fund a new or used car.

NRMA New Car Loan
From
4.99%
(fixed)
5.69%
You'll receive a fixed rate from 4.99% p. a.
Purchase a new or used car up to 2 years old and benefit from a fixed rate and no monthly fees. Pre-approval available within 5 business hours.
You'll receive a fixed rate from 4.99% p. a.
Purchase a new or used car up to 2 years old and benefit from a fixed rate and no monthly fees. Pre-approval available within 5 business hours.
Stratton Finance New Car Loan
From
4.05%
(fixed)
5.63%
You'll receive a fixed rate from 4.05% p.a. depending on the lender you are approved with
Apply for up to $250,000 and use cash or trade in a vehicle to use as a deposit. Optional balloon payment available.
You'll receive a fixed rate from 4.05% p.a. depending on the lender you are approved with
Apply for up to $250,000 and use cash or trade in a vehicle to use as a deposit. Optional balloon payment available.
NAB Personal Loan Unsecured Fixed
From
9.99%
(fixed)
10.88%
You'll receive a fixed rate between 9.99% p.a. and 18.99% p.a. ( 10.88% p.a. to 19.83% p.a. comparison rate) based on your risk profile
An unsecured loan up to $55,000 you can use for a range of purposes and pay off over up to 7 years. Note: Majority of customers will get the headline rate of 12.69% (13.56% comparison rate) or less. See Comparison rate warning in (i) above.
You'll receive a fixed rate between 9.99% p.a. and 18.99% p.a. ( 10.88% p.a. to 19.83% p.a. comparison rate) based on your risk profile
An unsecured loan up to $55,000 you can use for a range of purposes and pay off over up to 7 years. Note: Majority of customers will get the headline rate of 12.69% (13.56% comparison rate) or less. See Comparison rate warning in (i) above.
NRMA Used Car Loan
From
6.49%
(fixed)
7.19%
You'll receive a fixed rate from 6.49% p.a.
Finance a used car with NRMA and benefit from a fixed rate term and no monthly fees. Pre-approval available within 5 business hours.
You'll receive a fixed rate from 6.49% p.a.
Finance a used car with NRMA and benefit from a fixed rate term and no monthly fees. Pre-approval available within 5 business hours.
SocietyOne Car Loan
From
6.99%
(fixed)
6.99%
You'll receive a fixed rate between 6.99% p.a. and 20.49% p.a. based on your risk profile
A loan from $5,000 to use for a range of purposes. Benefit from no ongoing fees and no early repayment fee.
You'll receive a fixed rate between 6.99% p.a. and 20.49% p.a. based on your risk profile
A loan from $5,000 to use for a range of purposes. Benefit from no ongoing fees and no early repayment fee.
Symple Loans Personal Loan
From
5.75%
(variable)
6.47%
You'll receive a personalised interest rate from 5.75% p.a. to 25.99% p.a. based on your risk profile
Borrow up to $50,000 to pay for what you need.
You'll receive a personalised interest rate from 5.75% p.a. to 25.99% p.a. based on your risk profile
Borrow up to $50,000 to pay for what you need.
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Compare up to 4 providers

Prices are for base models. Prices from redbook.com.au and accurate as at time of publishing.
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Car Loan Offers

Important Information*
Logo for IMB New Car Loan
IMB New Car Loan

You'll receive a fixed rate of 4.99% p.a.
A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one up to two years old.

Logo for Beyond Bank Low Rate Car Loan "Special Offer"
Beyond Bank Low Rate Car Loan "Special Offer"

You'll receive a fixed rate of 4.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.

Logo for RACV New Car Loans
RACV New Car Loans

You'll receive a fixed rate from 4.99% p.a.
A larger loan of $5,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees.

Logo for NRMA New Car Loan
NRMA New Car Loan

You'll receive a fixed rate of 4.99% p.a.
Purchase a new or used car up to 2 years old and benefit from a fixed rate and no monthly fees. Pre-approval available within 5 business hours.

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