The End Of Financial Year is 30th June 2021. You can expect car dealers to start running sales anytime from mid-April 2021, right up to the deadline. Sometimes, the promotions even go beyond the EOFY into July, but you need to check the small print.
Audi started its EOFY event in early May 2021, other manufacturers are following suit.
Should I purchase a car during EOFY?
EOFY sales are usually very attractive, with many dealers across Australia offering great deals on car purchases. In fact, this period is the only time you can get bargains that can save you a couple of thousand dollars with promotions that cover on-road costs, such as third-party CTP insurance, stamp duty and registration fees. Other manufacturers have gone down the route of fitting optional extras for free.
How to bargain for a better deal during EOFY
EOFY car sales present a unique opportunity to purchase cars at reduced prices, as dealers battle to attract more customers before the close of the financial year. Purchasing a new car during these sales gives you a genuine opportunity to save money and get a great deal. Don't be afraid to put a little pressure on a salesperson. Make it clear you're ready to buy, but perhaps want metallic paint or an option pack thrown in additionally. With the push to meet performance targets, the dealer might just meet your request to secure the order.
As lucrative as it may be, getting a great bargain on EOFY sales can be a daunting task, as the period is usually hectic. To ensure you get in on the act and enjoy great bargains on cars, take time to compare personal car loans from different lenders, so that you get one that suits your budget. During the close of the year, lenders are also desperate to hit their yearly credit targets, meaning you can get a car loan with reduced interest rates, even with a credit rating that isn't so great. With your low-interest motor vehicle financing, you'll be in a great position to take advantage of EOFY deals from car dealers and get a business vehicle; or a personal car, for discounted prices.
How to save money when buying a car during EOFY car sales in Australia
The main reason people jump at EOFY sales is to save as much as possible on a car purchase.
Keep the following tricks in mind to make sure you get the best deal during the sales.
Consider last year’s model
You can save a lot by opting for a 'plate runout deal'. These are deals on last year's models that have been sitting around the dealership for a while. Because they're slightly older, dealers usually want to get rid of these cars first.
So if you don't mind having a slightly older car, this might be the way to go. Remember that cars depreciate the second they leave the lot anyway!
Know a good deal when you see one - and when to walk away
If you find a dealer offering competitive rates, you can save more by taking advantage of this, especially if the rates are offered as part of a lucrative overall package.
However, in most cases, it may be better to use a third-party financial provider to source the affordable car finance you use during EOFY sales.
Some quick high-school maths can help you save, particularly if you're getting a loan to pay for your car. While it can be tempting to go with the "low-interest financing" the dealer offers you, make sure you read the fine print.
Dealer-arranged financing, like 1% finance offers, often include a 'balloon payment' at the end of the agreement, which means you'll have to pay up to half the car's value - up to thousands of dollars - in one go at the end.
See how much the car will cost you in the long run
Remember that what you pay for the car isn't the only cost you'll need to think about. When you factor in the cost of insurance and servicing, you could easily bite off more than you can chew.
We analysed the cost of car insurance from 10 brands in 6 states for a 30-year-old male driving a Toyota Corolla, and found that the difference in the cost could be hundreds of dollars a year.
In Victoria, one policy was $1,504.80 per year, versus the cheapest comparable option, which was $815.34 a year. That's a difference of $689.46! Even on a bad day, that's a return ticket to Bali - which would you rather spend your money on?
Do your research
Don't be swayed by sweet-talking dealers. Come into the dealership knowing what car you want, what model, and what you'll use to pay for it.
For instance, a few manufacturers may have facelifted models, giving them additional equipment and slightly revised capabilities, but are they worth coughing up thousands of extra dollars?
Crunching the numbers ahead of time is worth it so you can save your hard-earned money.
If you're pre-approved for a loan, you can skip the sales pitch and get straight to hammering out a deal.
Terms and conditions
Some car dealers are not very transparent about the real price of the car they're advertising.
In order to ensure you get a good deal, be sure to read through the fine print on the car advertisement to ensure the car you're buying is the right car for you.
Pick and choose features
Extra features on prestige car models can raise the retail price significantly, so you can ask for certain features you may not need to be dropped in an effort to bring the cost of the car down.
Cost of delivery
Delivery fees should also be considered carefully when buying a car because they can raise the price despite the dealer offering discounts on the on-road costs.
A car finance expert spills the best tips for EOFY sales
We spoke with a car loan expert from Stratton Finance who explained to us why right now is the perfect time to buy a new car.
Can you explain what EOFY sales are?
According to the Stratton Finance spokesperson, the EOFY sales are a rare opportunity.
"EOFY is a great time to be considering looking at buying a new car. It's the only one of a few times in the year when all the commercial factors are pointing in favour of consumers."
The spokesperson went on to talk about how dealers may be willing to add on optional extras to make that sale.
"Not only do car manufacturers use this period to generate the last rush for sales revenue with discounts and added extras to create demand but more importantly, and beneficially for consumers, manufacturers are desperate to move older stock. This is where consumers can get the best deal with significant value-added extras."
Which cars promise the biggest savings?
The Stratton Finance representative said if you were happy buying a previous year model, for example, over a current year car, you might well play the car dealer at their own game.
"We see at this time of year customers who are open to buying the same car, but with an older build or compliance, always getting the biggest and best value. Manufacturers don’t promote the fact that older stock begins costing them more money than they can make selling a brand new one."
What are the typical cost savings buyers can expect?
Thanks to Stratton Finance's sister companies, the loan company has access to car market industry data. The representative was able to look at typical savings.
"When it comes to savings we see two dimensions when buying a new or demo car. The first being sale price. Depending on the make and model we see savings between 7% - 23% off the original starting price."
The expert told us the savings weren't only financial ones.
"The second is value-added extras, again depending on the make and model it would be unusual for Stratton customers to not have received complimentary servicing for 2-5 years, free roadside assistance, free factory extras like tinted windows, leather seats or even a sunroof."
Which car financing methods or lending products offer the best tax benefits for business buyers leading up to the end of the financial year?
Business vehicle buyers can get in on the action, too.
"During this time of year, we experience a significant increase in enquiries about chattel mortgages and novated leases from both retail and business customers. While each borrower's tax circumstances are different, both chattel mortgages and novated leases offer tax benefits via GST deductions, operating costs for business purposes, and depreciation benefits may also apply."
Can you share any other tax tips for borrowers looking to take out a loan during EOFY sales?
The spokesperson also suggested you should speak with an accountant before entering into any business finance contracts.
"The single biggest piece of advice I would give is to make sure you get qualified advice from your accountant. From time to time consumers come to Stratton for help on how to get out of a finance contract they entered into with a car dealer or bank that it is not fit for their personal tax circumstances and are now experiencing some potential pain with the tax office."
What's the deadline for scoring a lucrative deal?
If you want to take advantage of the offers, or were thinking about purchasing a car, you don't have long. You should get pre-approval now.
"Given the competitive market conditions and the number of offers in the market we are encouraging customers to complete a full finance pre-approval and use the final ten days of the financial year to capture the best discounts. If the car dealer knows you are ready to go and are able to pay within 24 hours, they will usually do everything they can to get the deal done and you on the road in your new car. Shopping for a deal at the last minute without a pre-approval can be difficult to grab the attention of the car dealer, as they are looking to move as many cars as possible before 30 June 5 pm."
Can you briefly tell us what Stratton Finance does?
"Stratton Finance is a car finance broker; the team provides unbiased advice and research about finance options for your car. Unlike car dealers or banks, we don’t believe "one size fits all" when it comes to financing. Our team not only makes sure customers are not buying a lemon or a stolen car, but we also research our industry leading finance partners and come back to customers with the three best deals that best fit their personal circumstances."
What is the most unusual thing you've ever loaned money out for?
With a long operating history, Stratton has lent money for some really quirky purchases, including a sausage machine!
"In recent times the two items that stand out the most are an industrial size sausage machine and a G5 Private Jet."
Car finance options during EOFY sales
If you're looking to secure finance for your car purchase, you might want to look into getting pre-approved for your loan.
Pre-approval can give you the upper hand in the sale as you'll know how much you have to spend and have more bargaining power.
Car loans come with lower rates than personal loans.
So, if your car is new or under two years old you may be better off opting for a secured car loan rather than an unsecured personal loan. You'll usually find rates between 6-10% p.a. and above for a car loan and between 8-16% p.a. for an unsecured personal loan.
If you're considering dealership finance, remember to check how much of a balloon repayment you'll be required to pay and when.
Many dealership finance offers come with a balloon repayment requirement of as much as 50% of the car's purchase price, so keep this in mind when considering the deal.
Ben Gribbin is an experienced automotive writer and life-long car enthusiast with a passion for restoring classic vehicles. He brings many years of experience working with and writing about cars to Finder.
If you’re in the market for a new car, the Great Southern Bank Fixed Rate Car Loan may be able to give you the funds you need. With the security of a fixed rate and flexible repayments, this loan might be what you need to own your new set of wheels.
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