Reader enquiry: What should I buy with a $20k budget?

“I currently own a Toyota Yaris but it’s time to upgrade. I’ve been driving a borrowed Holden Captiva and quite like size and high driving position. I have around $20,000 to spend and think an SUV might suit my needs of commuting about half an hour each way and delivering and collecting my daughter to and from school. I would consider a used car as long as it is not too old and will be reliable. What about a Mazda3 or Honda’s small SUV?”

THANKS JANE … as always, finding the right car is dependent on many factors, not least is personal preference.

The additional information you provided has made it possible to make some qualified suggestions. Almost all can be found for around $20,000, often with minimal mileage (in some cases, just delivery miles). Many dealers are pressured into taking stock they don’t have orders for and then have to clear them ideally before, but more often than not after, the end of the financial year. All of the recommendations are petrol-engined (you don’t do the right kind of travel for a diesel, and your budget doesn’t stretch that far anyway) and score well on safety. The good news is that there are some excellent possibilities for new cars within your budget, as well as low-mileage, almost new used cars.

My strongest recommendation would be the Hyundai i30. Your budget will almost get you into a new base model, but will give you plenty of choice in cars a year old or thereabouts (perhaps two years old through a dealer). Since Hyundai has a five-year warranty, you’re still covered for years. Hyundai do a capped price servicing deal as well, so you know what you’ll be up for. You’ll be looking for a 5-door hatch.

Probably on an equal footing with the i30 is the Kia Cerato 5-door hatch. There’s a new model coming in a month or so (the sedan has already been released) so you may well find a brand new one for your budget (but remember that it will be superseded in a month or two). Again, a Cerato hatch up to a year old could give you more choice and a higher spec level. Kia have a seven-year warranty so you’ll be covered probably for as long as you keep the car. They also do capped price servicing, so you’ll know precisely what your outgoings will be for the next seven years (if it’s a new one) and six years if it’s less than a year old.

Another possibility for you would be the Mitsubishi ASX. It’s one of those pseudo SUVs, really just a taller Lancer, but may give you that bit of extra height you’re looking for. You’ll be unlikely to find a new one for this money, but there are plenty of low-mileage examples perhaps between one and two years old, that are affordable.

Another left-field choice is the Skoda Rapid Spaceback (it’s a hatchback). Essentially, you’re buying a Volkswagen at a discount price and it’s a good-looking thing. Once again, you won’t find a new one at this price, but Skoda resale values mean there are plenty of good, low-mileage examples around for your budget. The Skoda is a cut above the others for quality. However, check the servicing costs, and you only get a three-year warranty – it would be worth asking if they can include an extended warranty and see if they are offering capped or fixed price servicing.

Finally, I’ll go right out on a limb and suggest you take a look at the Haval H2. It’s another smallish pseudo SUV (two-wheel drive). Like all Chinese brands, you get a lot for your money, but it’s a bit of an unknown quantity – resale value is probably not going to be good, and they haven’t been available long enough to have established a reputation, so reliability is also something of an unknown – on the plus side, the warranty is 5-years/100,000km. It is slightly larger than its direct competitors (things like the Honda CR-V, Hyundai Kona etc., more on a par with the Toyota RAV4) and a little thirsty on fuel.

Since you mentioned the Mazda3 and the Honda SUV, you must have been considering them. The Honda will almost certainly be outside your budget unless you buy one with high mileage or slightly older. The Mazda3 is an excellent car, but you will probably find it feels a little small, judging by the criteria you have set.

Let me know how you go on your initial search and we’ll refine it as necessary. I’d suggest going onto one of the online car markets and taking a look at what’s available – leave the specific details out (just put in the make and model), and set the price range at $15,000 to $25,000 – there’ll be lots of cars too far away to consider, but it will give you a better idea of what your money will buy.

Jane has reported back to seniordriveraus that after looking at our recommendations, she has bought a new Kia Cerato hatch. We’d say she has made a considered and responsible choice. Happy motoring, Jane!