Due to cars being objects of desire, it’s quite apparent that it is not only a decision of the mind when making a purchase, but also a decision of the heart. Emotionally speaking, cars must match our needs and desires just as much as they need to be practical. At least this is true if we are to get the most out of them.
Which is one of the reasons why negative equity hurts so much. Cars are one of the few things where you can nigh on guarantee that a year later it is going to be worth less. Generally speaking the complete opposite is true in the housing market.
It is well known that some cars, when bought new, will lose 15-20% of their value when you’ve had it for a year, and maybe about 5-10% as soon as you drive it off the forecourt and the salesman is waving you away. And yet we still buy cars – new and used.
I guess what it comes down to though is that cars and driving are pretty much a necessity in modern day Britain – certainly they are for me anyway as otherwise I couldn’t get to where I work. In the grand scheme of things, like spouses, your children and beer – the things you love take your money!
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