Identifying the best cars to buy can be a daunting task when buying and selling cars. I have laid out some basic steps for the research process for you to take when flipping cars aimed at anyone hoping to make some extra money on the side. I hope it’s useful and if I’ve missed anything crucial let me know!
The truth is, you don’t have to be an expert by any means to do this, people might tell you that you do but you don’t. It’s simple really, you just need someone to show you the exact steps involved in flipping cars…. and surround yourself with winners!
Just to give you an idea, I will be developing an A-Z guide that will break EVERYTHING down for you when it comes to flipping cars, in a lot more detail that what you’re reading now, including exactly how to find the best cars to buy used, however in the meantime this post should be a great start……
Okay, Lets do this….
Finding the best cars to buy
With any great deal, you’ll have to sit and find it. This is probably the most tedious part of the procedure, in my opinion anyway. Mainly because your sat searching through different sites looking for the best cars to buy or a good deal. The truth is however, you’re very unlikely to find a good deal just sat there looking at you. Think about it, when a seller wants to sell his car, they won’t post it well below market value from the get-go. They will most likely look to see what everyone is charging then go for a similar figure.
When it comes to finding the best cars to buy you need to think and have a look at what is selling in your area. The logic being, you don’t want to be stuck with a car for too long. You’re looking for quick flips to keep your investments liquid (in cash form)
The truth is, if you see a car posted well below market value, then it is probably a scam!!! They sometimes have email addresses posted in the images and start telling you stories that the car is abroad and all this rubbish….stay away!!)
Remember, you’re unlikely to find a car posted cheaply from the start. The best cars to buy are listed at around market value, it’s going to be your job to try and pay less than what its posted for. That’s a major part of buying and selling cars…. I’ll get to this though….
Well, it depends on how in-depth you want to go. You could probably get away with just doing some pondering on what cars do you see most on the roads. That’ll give you a starting point as to what the best cars to buy are. In my case though, when I think about it (I’m based in the UK) I see a lot of Vauxhall Corsa’s & Ford Focus’. To verify my thoughts though I did a quick google search on ‘Most common car in the UK / US’ and this came up….
So clearly there is some information already out there! (maybe not scientific to a statistical degree, but it’s a great start)
Then you would choose a make and model depending on how much you want to invest, for example…
If you had just £500, (or $500!) go for the smaller cars (Vauxhall Corsa), If you have a couple of grand then look at bigger models (Vauxhall Astra).
Challenge yourself: 5 grand profit in 4 flips?
When buying and selling cars, the more money you can invest into a car the higher your profit is likely to be. Just to give you an idea, if your investing 2-grand then you should be able to turn that into 5-6-grand after 3-4flips no problem. However if you’re just starting out, stick to a budget around 500-1000 pounds/dollars
Remember though, regardless of your budget, try not go for newer models. You don’t want to be a victim of the depreciation curve that we all know cars are subjected to.
A good rule of thumb, in my opinion, is to try and not go for models newer than 5 years old. You can go as far back as you like (to some degree!)
Ok so now you have a model in mind?
Great stick to it! Don’t be jumping about from one to another as this breeds uncertainty and indecision which can be crippling. You’ll end up making no progress after hours of research and you won’t be any closer to beginning your journey of flipping cars.
So now it’s time to jump online and begin searching. In my opinion looking online is probably the place to search for the best cars to buy as the market is a lot fairer and less prone to fluctuations.
There are lots of sites to choose from however lets keep it simple for now. I’d advise you to go with Autotrader and Ebay (relevant for both UK & US flippers). And start searching your model.
The idea is to start refining results according to your budget.
Let me explain what I mean by that.
(What’s about to follow is all relatable for you U.S. Readers! Just flip the currency and follow the same principle!)
Okay, Let’s start with Autotrader, and let’s say I’ve chosen in my previous stage a Vauxhall Astra….
and my budget is £1000.…
This is what I would do….
I would set my search criteria to… £1000 – £1500.
The reason I’ve done this is because this is where your profit lies. Your intention is negotiate yourself a good deal that will leave you enough room for you to be able to relist the car at (or ideally slightly below) market value for a quick sale.
This method highlights the importance of negotiating skills when flipping cars and shows that really, that’s where you are going to make your money. I have an article on the way for negotiating tactics so hold on for that!
(Here I have increased the range by £500, if my budget was, lets say, £5000, I could increase the range to another £2000, taking my search to £7000. A rough idea is 25-33% more than your budget.)
Then I would sort the results from High>Low…. People automatically list from low to high hoping to find a cheap car. However again, you’re hoping to grab yourself a bargain at the point of sale rather than finding a bargain now.
This is what I saw……..
After we have a list of potential cars of the best cars to buy, it is useful to get a sense of the ‘valuation’ for each car. This will aid you in the negotiation process. You can use Auto trader’s car valuation tool for this.
You then need to go through each listing, (looking out for any overvalued cars that shouldn’t be in that list) and try to find cars that support an argument for negotiation. This could be high miles, poorly taken photos, unclean interior, that sort of thing.
Your intention of course, is to maximise profits and buy your investment for as low as possible. To do this emotion needs to be put aside and you need to have facts at hand.
I personally am a stickler for spreadsheets so at this point. I put together a spreadsheet of potential cars that looks like this….
This is the point where you start making calls in pursuit of viewing cars.
The next steps are simple however, we will get to that, just get started with this part for now.
Important principle: Adapt to the new shape.
What I mean by this is this. If you are at a price point where you see a shift in the shape of the vehicle, adapt your budget to always go for the newer looking shape. Even though people are buying a car that might be 10years old, if the shape of the car only stopped being made 5 years ago, it plays into the mentality of the buyer and makes them feel the car looks newer than it is. Check out the example below:
We have 2 cars within the same research session, only a year apart in age. One in excellent condition however the old shape, the next the newer shape but with more miles. You’re more likely to sell the newer shape faster than the older one even though it’s done more miles. Buying and selling cars isn’t an exact science, you just need you put yourself in the shoes of the buyer.
Using Ebay to find the best cars to buy
It’s a bit different with ebay…..
You can follow the same principles above when you’re trying to find the best cars to buy. But you need to make sure you’ve refined the search to only show buy it now’ listings. This is because with an auction you’re actively looking for the bargain online. Rather than depending the human aspect of negotiating yourself a better deal and preying on the seller’s phycology. (that sounded horrible but it’s the truth). That isn’t to say you can’t grab a bargain via an eBay auction. It’s just that I think it’s best to view the car in a calm and calculated environment rather than bidding blind.
For anyone new to flipping cars and hoping to start making extra money on the side, you’ll want to protect your investment as much as possible. You’ll be able to do this by following the checklists I have made available for you to download. The checklist outlines exactly what questions to ask and what to look out for.
Oh! and Ill do another article on how to research on ebay!
You can of course also browse through local newspapers, classifieds and also keeping an eye on the street. There’s lots of money to be paid in this market so just keep your eyes open.
Ok guys so I’ll leave it there for now. I could keep going but I think its best not to overwhelm you just yet
Flipping cars: taking the first step
The truth is, you might be feeling like this is a lot to take in. Or maybe you’re not even thinking that, maybe you’re just struggling to take that first plunge. My advice is this, just split up everything into tiny parts, into tiny little jobs, tiny little segments. (and follow my checklists!). That’s what I did.
And that’s what iv tried to lay out for you here.
I don’t know if I was able to help you at all. My aim was to help you take the first step and identify the best cars to buy. Also that it really isn’t that hard. Researching the best cars to buy is that starting point. Anyone can start making money on the side buying and selling cars. You don’t need to be a motor head. I certainly am not. You just need to follow a few steps which Im going to cover in my A-Z guide for flipping cars. In the meantime however, Ill be publishing lots of tips on this site, along with some awesome free stuff.
Im especially interested to see if you guys have any tips or tricks in the research process that I missed.
If so leave a comment!
Download your FREE
'28-point Buying a Car Checklist'
Join our mailing list to receive the latest news and updates from our team.