Carefully consider your specific needs and the pros and cons of buying a car from different kinds of sellers.

Before you hit the car yards or get set on a specific make or model, make sure you understand what sort of vehicle will meet your needs and situation. A little preparation in advance will help you avoid issues later.

Know your financial situation

Before you start viewing cars, ask yourself how much you are willing — and can comfortably afford — to pay. To do this, it helps to have a clear idea of how much money you have coming in and going out every week or month. Sorted’s budgeting tool can help.

Budgeting tool(external link) — Sorted

Remember, the ticket price and monthly payments aren’t the only costs of owning a car. Running costs include:

  • interest and fees to the lender if you buy on finance
  • warrant of fitness (WoF) fees
  • relicensing fees
  • fuel 
  • charging costs for electric vehicles, such as at-home electricity costs and charging station fees
  • on road costs, such as road user charges (RUC) for diesel vehicles
  • regular servicing
  • maintenance and repairs
  • insurance
  • parking.

Running costs include on road costs and, from April 1 2024, road user charges (RUC) for electric vehicles.

Most cars, especially new ones, go down in value a lot after you buy them. Buying a slightly older car can reduce your initial purchase costs and limit your losses if you sell it later.

Consider how finance works for you

In a perfect world, it’s best to save enough money first to buy your car outright. You will avoid the risk of unmanageable debt if your financial situation changes.

But most people need to borrow for a car. If you do, try to sort out financing before you buy one. It’s often more convenient to get a loan from a car dealer. Often with dealer arranged finance, you can’t decide to pay more than the set payments or pay off the loan early.

If you arrange finance with a bank or lending institution, you may be able to control how much and how quickly you pay off your loan. If your situation and the terms of the finance contract allow it, you should always try to pay more than the minimum monthly payments. You will save money on interest.

Shop around for the lowest interest rates available to you before you decide which lender to go with.

Use Sorted’s debt calculator to estimate the true cost of financing a car, including how much you will pay in fees and interest.

Debt calculator(external link) — Sorted

Car loan checklist [PDF, 555 KB]

Read more on Getting a loan for your car

Understand which make or model will fit your needs

Look at different cars in your price range. Before you get set on a specific make or model, make sure it fits your needs. Ask yourself:

  • How often will you be driving the car?
  • What kinds of roads will you be driving on most often?
  • Will you be doing lots of city driving?
  • Will you be driving for long distances? 
  • Do you prefer how your car is powered, for example, petrol, diesel, electricity?
  • How often will you be carrying passengers?
  • Do you need to be able to tow?
  • Will anyone else be driving the car?

If you only need a 4x4 for a couple of weekends a year, it’s probably cheaper to buy a more economical car and rent a larger car whenever you need it.

Consider vehicle safety

Before you buy a vehicle, you can check the star safety ratings of the vehicle you're considering buying by searching the number plate or make and model on the Rightcar website.

Almost every vehicle has a safety rating from 1 to 5 stars. This rating indicates how well the vehicle is likely to perform in a crash. Vehicles with 4 and 5 stars are the safest, while 1 and 2-star vehicles provide little or no protection in a crash. 

There are vehicles with high safety ratings available in most categories and price brackets so buy the car with as many stars as you can afford.

Crash avoidance features are good to focus on too, as they can help avoid a crash from happening or minimise its severity if a crash does occur. They are particularly important if younger or less experienced drivers will be behind the wheel.

Some important crash avoidance and other safety features to look for are:

  • autonomous emergency braking (AEB) which detects if a collision is about to happen and brakes (or assists the driver to)
  • lane keep systems to help ensure you stay within your lane
  • electronic stability control (ESC) to prevent the car from sliding or skidding out of control
  • side curtain airbags to protect you and your passengers from the side in a crash.

You can find vehicle safety ratings and safety features on the Rightcar website:

Safety Ratings(external link) — Rightcar

Look for the safety rating when buying a vehicle and choose the safest, cleanist, and most efficient one in your price range.

The more stars, the safer the car. Ko te nui atu o ngā whetū ko te haumaru atu o tō waka.

Understand fuel economy and emissions

Consider fuel consumption and emissions. Vehicles that use less fuel or are fully electric will save you money and lead to cleaner air and healthier communities.

You can find fuel economy, and air pollution and emission ratings for certain makes and models on link) .

The environmental rating covers two types of emissions. Carbon emissions relate to the release of greenhouse gases, while air pollution reflects the impact of exhaust fumes on our health.

Vehicles with a 6-star environmental rating are cleaner and less polluting that those with fewer stars.

Look at environmental ratings when buying a vehicle. Choose the one with the most stars in your price range.

Buying a car from a dealer

Electric vehicles and hybrids

Electric vehicles (EVs) can be cheaper to run than standard engine-powered cars. Most used EVs in New Zealand are imported from Japan. Like with any car, consider running costs and the type of vehicle that might fit your needs. 

  • Battery electric vehicle (BEV): Powered by an electric motor, no engine. Can be charged at home or at a charging station.
  • Plug-in hybrid electric vehicle (PHEV): Has an electric motor and a petrol or diesel-powered engine. Battery can be charged at home or at a charging station. Engine needs maintenance like a non-EV car. Needs petrol or diesel, depending on the engine. When battery power gets low, most PHEVs automatically switch to engine power.
  • Non-plug-in hybrid: Has a petrol or diesel-powered engine. Also powered by a battery charged while driving. This battery cannot be charged using an electrical source.

EVs are exempt from road user charges through to the end of March 2024 as part of the government's clean car package, incentivising the uptake of clean vehicles.

For advice on buying an EV, see the Gen Less website:

Electric vehicles(external link)  — Gen Less

EV batteries and charging

Think about your driving and charging needs before you buy an EV. If you want to drive longer distances, you might need an EV that can fast-charge — not all can. If charging at home isn’t an option, you need access to public charging stations.

It’s important to understand the car’s current driving range. The battery in a used EV will not perform the same as when the vehicle was new.

The time it takes to charge an EV battery — and how much it costs — depends on the power source:

  • Charging at home: Often done overnight. Consider using a power company that offers off-peak or special rates for EV owners.
  • Charging stations, e.g., at a carpark or petrol station: Can take 20-30 minutes to several hours, depending on charger type and battery size. Some are free. Others you pay through an app, website, or monthly bill.

EVs can be cheaper to maintain and run than standard cars. But EV batteries can cost several thousand dollars to replace if something goes wrong. For used EVs, ask a dealer or vehicle testing station to do a state of heath test (SOH). 

The SOH test will help you find out:

  • roughly how far the EV can travel on a fully charged battery
  • how well the battery performs compared to when it was new 
  • if the battery has any faults.

Battery health and capacity are affected by: 

  • age 
  • how the EV is driven 
  • exposure to extreme temperatures 
  • long periods without use 
  • how often a battery is fast charged.

EV charging cables need to be compatible with New Zealand systems and meet safety standards. A dealer should provide a copy of the Supplier Declaration of Compliance (SDoC). If you suspect the charging cable plug has been changed, or if there is non-English writing on the cable, don’t use it. The wrong cable can overheat or even catch fire. Check with an electrician. 

EV charging guidelines(external link) — WorkSafe 

EVRoam map of public chargers(external link)  — Waka Kotahi

For tips on owning and driving an EV see the Gen Less website:

Electric vehicles(external link) — Gen Less

EV batteries(external link) — Gen Less

Other considerations

Flood damage

Recent weather events mean a significant increase in the number of water damaged vehicle. 

Flood damage can be hard to spot, and it may take time before problems show up in the form of electrical failures and corrosion.

Buying from a licensed or registered vehicle dealer that is covered by the Consumer Guarantees Act, offers the best protection for consumers.

You can check if the vehicle is floodwater damaged.

Water damaged vehicles – what you need to know(external link) — Waka Kotahi NZ Transport Agency 

Other factors could include:

  • the car’s average resale value
  • the car’s depreciation rate over time
  • how easy it is to get spare parts for the car if something goes wrong.

You can find this information in car reviews, online forums and by asking experts for their advice.

Avoid buying a water damaged vehicle

Get the vehicle checked and look out for the signs Waka Kotahi lists on their website.

Water damaged vehicles – what you need to know(external link)  — Waka Kotahi NZ Transport Agency

Differences between a car dealer and a private sale

Common ways to buy a car in New Zealand are from a:

  • private seller, such as a car listed by a person on Trade Me, online forums, adverts, and community notice boards
  • registered motor vehicle trader, in other words, a car dealer
  • car auction, where cars may be sold from both private sellers and car dealers
  • car fair, where cars may be sold from both private sellers and car dealers.

There may be reasons why you might choose to buy from a private seller. You may be able to negotiate a lower price from the seller. Also, dealerships usually have fewer older or low-cost vehicles available.

But it is safer to buy from a registered car dealer. Cars sold by dealers are covered by the Consumer Guarantees Act, Fair Trading Act, and other consumer laws. Dealers are also required to display a Consumer Information Notice (CIN) on used cars. The CIN lists important details on the car, such as the:

  • vehicle history
  • cash price
  • make and model
  • any money still owing on the car from the previous owner.

These protections mean you have more options if there’s a problem after purchase.

Here’s a quick overview of which laws protect you if you buy from a private seller vs car dealer.

Legal Requirements Private sellers Car dealers
Display Consumer Information Notice (CIN) on vehicle
Follow the Consumer Guarantees Act
Follow the Fair Trading Act
Follow the Credit Contracts and Consumer Finance Act

In some limited situations, a seller can ask a buyer to waive their rights under the Contract and Commercial Law Act (CCLA) — but they must be clear about this request before they sell you the car.

No matter who you buy from, learn as much as possible about the seller beforehand. This might mean:


Man Computer

Searching the web for any reviews on the car dealer

Female Computer User

Reading customer reviews on a car dealer’s social media

Pro Thumbs Up

Looking at a private seller’s Trade Me reviews and feedback score.

Read more about Buying a car privately

Read more about Buying a car from a dealer