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Wednesday, November 5, 2008

Buying A Car To Travel New Zealand

A cautionary tale by David Morris.

The best way to tour New Zealand is by car. With your own set of wheels you travel when you want, go where you want, and stop when you want. Coach options don’t allow that.

If you're travelling New Zealand for two months or more, buying a car can be an economical option. Cars are relatively cheap here because we import tens of thousands of used Japanese cars every year. You can buy a reasonable runner from about $1000 upwards.

The problem is selling it again when you are about to leave. If you don't get a sale by departure date you can end up nearly - or actually - giving it away. Be especially careful if your plans involve departing around late March or later. By then there are hordes of backpacker hopefuls trying to sell off their old cars, station wagons and vans. It's a murderous buyers market from then on.

Auckland airport’s car park regularly clears away vehicles abandoned by departing travellers because they were unable to sell them in time.

If I were a rich man (if only) I would buy cars at that time of year and sell them again as the summer heats up and the visitors arrive.

One way to avoid the problem is to buy with a guaranteed buy-back. Strictly speaking it should be called buy and sell-back. Under this arrangement you buy a car from an operator who gives you a guaranteed price at which they will buy the vehicle back when you've finished with it.

Other options are to buy the car either privately (directly from the owner) from a car dealer or through the auction system. While you can pay under $1000 for car - easily - don't expect such a vehicle to perform well or be reliable. They are, almost without exception, rubbish.

Private purchase

Best hunting ground is the car fairs which are held on Saturday and Sunday mornings Or through a newspaper called Trade and Exchange which is published every Thursday. Another option is TradeMe,, an online auction.

The car fairs are, however, the stalking ground of the unlicensed and illegal dealers. They are there in droves looking to snare the unwary traveller. As soon as you have driven the car out the gate they are gone and there's no way of ever tracking them down.

One safeguard when buying is to ask how long they have owned the car. Ask to see the registration papers. Ask if they are the current registered owner. If they aren't then be suspicious. Be Very Suspicious. In many cases they are dodgy old bombs that have been given a quick-fix on any obvious problems. You'll be lucky to make it half way down the island in them.

In my considerable experience, privately owned cars - especially older ones - are often in poor repair and readiness. Remember, you are going to ask this vehicle to run steadily for several hours at a time on a round trip of 6000-8000kms. Most privately owned cars haven't had proper tuning and maintenance for years. Expect to spend money - $150 to $300 - on them before starting out.

There are now a couple of places where backpackers can take their car/vans to display for sale. Backpackers Car Market, 33 Battersea St, Christchurch or 20 East St, Auckland. From my own observations prices are not cheap - probably because the sellers are trying to turn a profit on the vehicle in order to finance the next stage of their trip. You may, however, be able to squeeze a deal if their departure day is looming.

You’ll also find lots of vehicles offered for sale on the noticeboards of backpacker hostels. Again, I urge caution. These vehicles have already done one long, hard run around NZ – and often more than one. The current owners (and probably earlier owners too) have no incentive to spend any more on the vehicle than absolutely necessary. They often fail to even do that. If they do have to pay for repairs they usually get the cheapest, dirtiest quick-fix possible. So you will buy their leavings and once they’ve sold the vehicle they’re usually on the next plane outa here – you’ll have absolutely no come-back against them.

If you know nothing about cars, either get it checked by a qualified mechanic or give it a miss. If you are starting from Auckland, go see my mate, Glen Stewart of South Pacific Autos. Ph 636-3364. He will give you an honest appraisal and won’t charge you a fortune for it. (See below under Car Dealers for more information about him).

Alternatively, if you want a full-on inspection the AA does that at a cost of $165. Be aware, however, that any car under $5000 (and a lot of cars over that) is going to have faults. Don’t let a list of minor problems put you off.

Auctions.

Auction is a wholesale market. You'll buy cheaper here than anywhere. But it is also totally a "buyer-beware" market. There are some hideous things lurking inside cars at auction. Trust me - I've been caught with 'em from time to time. For cars over $3000 best option is Turners Car Auction.. There are few cars offered for under that price.

Sale And Guaranteed Buy-Back Operators.

These are professional car dealers or rental car operators. In general terms you will pay more but get a safer, more reliable car from them The only buy back operator I know of in Auckland is Downtown Rentals. - my own family's business. 31 Neilson St, Onehunga, Auckland. (Call first - don't just go there - I'm not always on site). Cars from $990. Station-wagons from $1590. Fully equipped SleeperVans from $2490.

These are vehicles that have been used in our rental car fleet - thus we know their history and we know that they have been well maintained during that time. The cars are tuned and serviced before delivery. They are road-ready to run with a recent Warrant of Fitness - a legally required safety check that must be done every six months. We also offer a warranty against major breakdowns.

The buyback price is half the purchase price, with a minimum deduction of $900. Thus, for instance, a $1500 car will have a buyback [price of $600. It is not compulsory to sell it back to us . . . if you can get a better price, take it, but at least you have the certainty of a minimum cash-back on the day you leave. (We’ll even give you a free lift to the airport).

Car Dealers

Car dealers in this country must be licensed. If you are buying from a dealer of some sort check that they are licensed. In general, dealers don't sell cars less than $3-4000 or so - it's just not worth their while. But if you are looking for a better class of car then they are a safe and reliable bet. They will also usually re-purchase the car when you've finished with it.

For cheaper cars try a mate of mine, Glen Stewart of South Pacific Automotive. He's a mechanic (does a lot of work on my cars) and a car dealer. He won't put you crook. (That's a Kiwism for “won't cheat you”). He's wanted by the authorities in 25 countries (according to the tales he tells) - but he's as honest as the day is long. His phone number in Auckland is 636-3364.

Again, look in Trade and Exchange for screeds of offerings from dealers.

Transfer of ownership

Our system of registering ownership is so simple it often causes a look of disbelief in the eyes of a traveller when I explain it to them.

The first thing to realise is that the "ownership papers" are not proof of ownership. They are merely a record of the persons who are registered as owners - or put another way, a register of people who claim to be owners.

You can, literally, walk into any Post Shop in the country and on proof of your identity, register yourself as the owner of any vehicle in the country. But the fact that you have registered yourself as the owner doesn't make you the owner. To be the true owner you have to have bought it off the previous owner.

Thus, whether the "registered owner" is, in fact, the legal owner is a matter of contract law not of mere registration.

If you buy a car from someone who is not the legal owner then you have no legal title to the car. The true owner can reclaim it.

If you are buying from a private person you must therefore be careful - ask them for their address and phone number. Check out whether they are listed in the phone book at that address. Don't accept just a mobile number - get a landline number.

If the vehicle has only recently been put into their name be particularly wary. Ask why. To be honest, in that situation I'd give the vehicle a miss unless you have a good and certain address for them - like, you've been to their house and met them.

I had a van stolen from me a while back - a little toe-rag working for me as a mechanic "sold" it to someone who walked in off the street. He just failed to either check with me first, or to hand over the money. Within 24 hours it was on-sold to a well-known dealer who is always at car fairs selling vans to tourists. Two innocent visitors bought it off him and had absolutely no idea that the vehicle they bought was nicked. They were stopped when they tried to cross Cook Strait on the ferry. $2400 down the drain. “Not my problem,” says I when I re-possessed the vehicle. I felt sorry for them – but it was either them or me that took the hit. I preferred it to be them.

To transfer a car into your name is easy: Go to a Post Shop and fill out a form. It'll cost you $9.25 and take about five minutes. You'll need proof of identity - a passport or driver's license and a local address.

Safety checks, registration and Road User Charges

For a car to be legally on the road it must have a Warrant of Fitness (usually called a WoF), must be registered (i.e. the tax must be paid) and if it is a diesel-powered vehicle the Road User Charges must be paid up to date.

The WoF sticker should be at the top right corner of the windscreen. It will have the expiry date printed on it.

If a car does not have a current WoF don’t buy it. Under any circumstances. The risks are just too great. Make sure that the warrant will be valid for at least the length of your stay here. When you come to sell it again you may have to get a new warrant check . . . at that time you may well discover a lot of unexpected costs in order to have the vehicle brought up to standard. WoF checks can only be carried out by Government licensed testers.

In the lower left corner of the windscreen, is a label with a date on it. The tax on the vehicle has been paid up to that date. It costs about $20 a month to register. In order to register any vehicle it must first have a current WoF.

Road User Charges are levied on diesel vehicles at a rate of 3.8c per km for cars and vans. They must be paid in advance and you must have a sticker on the windscreen giving details of the mileage purchased. If you are not up to date the penalty is three times the amount of RUC owing, thus if you are in breach it can be very, very expensive. Before buying a diesel car make sure the RUCs are up to date. If not, demand that the owner purchase enough RUC to make it legal because you, as the new owner, become liable for any unpaid charges.

Insurance

Insurance is not compulsory in this country – and the sad fact is that the drivers most likely to hit you are the least likely to be insured. You don’t have to worry about personal accident insurance – that’s included as part of the registration cost of the car and is provided by the government operated Accident Compensation Commission.

You can get short term third party vehicle insurance from the National Auto Club. Many of the backpacker hostels also offer car insurance packages.

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