Buying a car in Melbourne is relatively straightforward and does not require you to be a citizen or permanent resident of Australia. However, you may experience problems in securing a loan for a new vehicle if you are not a permanent resident, or don’t have a work or rental history in Australia that dates back at least 2 years.
While many sales or executive positions with Australian companies or multinationals include a car as a benefit of the position. If your employer didn’t, however, you may find that you are on your own to arrange a vehicle.
Depending on the level of comfort you are accustomed to, prices for new and used cars in Australia can vary widely. A smaller, older-model used car can be found for as little as $1,000, while luxury vehicles can climb into the six-digit price range. In general, a show room new, current year model of an entry-level sedan can be bought outright from a dealership for between $25,000-$35,000.
Buying a New Car
The Australian car industry has healthy competition, and a range of domestic and foreign companies that manufacture vehicles for any need. The process of buying a car in Australia does not differ greatly from other western nations. Most new car dealerships have a range of current models on display in a showroom or lot, and a team of salespeople who will be eager to point out the various features of different models, or accompany you on a test drive.
Once you’ve found a car you are interested in purchasing, you will sit down at a table or in an office and negotiate the final price you will pay for the car. While negotiating price can change the final cost significantly, it is important that you reach an agreement with the sales agent for a “Drive-Away Price”. A Drive-Away Price will include the total cost of the car, the stamp duty (tax), and price of registration for one year.
If a Drive-Away Price can be reached, it will make the sale much more convenient for you, and put most of the documentation and registration responsibility on the dealership. They will pay the taxes to the correct government authority, and provide you with a registration sticker and license plates. At that point, all you will have to concern yourself with is how you will pay.
All major dealerships will have a finance department that can arrange a car loan for you. However, you are also entitled to arrange outside financing if you can find a lender with lower rates or better terms. Payment for the car will be expected in full, either in cash or through a bank check made out to the dealership (from you or your finance company, which they will arrange) on the day you pick up the car.
While there are a number of new car dealerships scattered around the Melbourne CBD, the largest ones are found in the outer suburbs where there is ample room for large lots with many vehicles. If you are interested in getting a deal, it may be worth it to travel out of the city to one of these larger lots where brand new cars are generally cheaper. However, it can be extremely difficult to access these far-flung dealerships to buy a car if you don’t already have a car. The following are a list of major news car dealerships within close proximity to the CBD.
John Blair Honda
405 High St, Prahran
03 9529 1255
Melbourne City Toyota
621 Elizabeth St, Melbourne
03 9282 8888
209 Kings Way, South Melbourne
03 8699 2888
690 Elizabeth St, Melbourne
03 9341 4444
Melbourne City Land Rover
351 Ingles St, Port Melbourne
03 9684 1000
Subaru Interactive @ Docklands
99 Lorimer St, Docklands
03 8698 3439
734 Elizabeth St, Melbourne
03 9349 1277
Buying a Used Car from a Dealership
Buying a used car from a dealership is very similar to buying a new car, but will require you to be more diligent in your inspections and negotiation. If possible, always negotiate to a Drive-Away Price that includes the costs of the stamp duty (as discussed above).
If you buy from a used car dealership, any car valued at more than $3,000 must come with a Roadworthy Certificate (the compulsory certification of safety that is required to transfer ownership of a vehicle in Victoria). As such, you are likely to see many, older-model, rough-looking cars selling for $2,999. If possible, avoid buying a used car that does not include a Roadworthy Certificate. Once you purchase a vehicle without one, it will be your responsibility as the new owner to make or pay for any repairs necessary to obtain one. This process can be time-consuming, costly, and there is no guarantee that the vehicle you purchased will be able to obtain Roadworthy Certification. Buyer beware.
While you don’t need any special documentation to buy a used car, you will be required to fill in a Transfer of Ownership form (see Required Documents section below), and most dealers will make a photocopy of your ID (Driver’s License and Passport).
If your car comes with a current Roadworthy Certificate (less than 30 days old), you can take the car directly to your closest VicRoads authority and file the paperwork needed to make it yours. You can obtain a Roadworthy Certificate at any mechanics workshop for around $70 (not including any repairs needed to bring it up to Roadworthy standard).
If you have not negotiated a Drive-Away price with the car dealer (as discussed above), you will also have to pay stamp duty when you go to VicRoads to register your car. Stamp duty will generally cost 8% of the value of the car.
Most of the larger used car dealerships are concentrated in the western suburb of Footscray, or outer suburbs. While the business name may associate with a specific brand (such as Toyota) all will offer used cars of various makes and models. Car City (details below) is a considerable distance from the city, but is a concentration of over 30 dealerships in one location, which can be very useful if you are looking to purchase a used vehicle quickly.
415-473 Maroondah Hwy, Ringwood
0419 334 868
Le Mans Toyota
4 Hopkins St, Footscray
03 9689 2944
Alan Mance Suzuki
419 Barkly St, Footscray
03 9396 8050
5 Star Cars
394 Barkly St, Footscray
03 9689 0099
490 Geelong Rd, Footscray
03 9314 0891
Buying a Used Car from a Private Owner
If you buy a used car privately (directly from the owner) there is no law in place that guarantees the car is roadworthy. Some will advertise a current Roadworthy Certificate, others won’t. You can have your own test conducted on the car by a mobile technician from the Royal Automobile Club of Victoria (RACV) before you buy the car. They will be able to tell you if anything will need to be repaired to bring it up to standard, and how much this is likely to cost. The test will cost about $120.
Be aware that a Roadworthy Certificate does not mean the car is in perfect condition, but that it meets the minimum requirements to drive legally on Australian roads. You may be able to arrange with the owner to have a more comprehensive inspection conducted at a service station to ensure the engine and components are in good condition (at your cost). Although the costs and inconvenience of this are annoying, they are often well worth it to ensure the car you are buying is worth the asking price and will last long enough to meet your needs.
Best sources for finding private sales:
The Age Newspaper’s Drive section classifieds
The largest and most well known resource for those looking to sell or buy their cars.
Manheim Fowles Auctions
Sells ex-government fleet vehicles at bargain prices
EBay’s Motor Section
Allows you to search for private sales within a set distance from your postal code.
Registration / Required Documents
If buying a new car from a dealership, much of the responsibility of filing these documents will fall to the dealership. However, you should ensure that the following paperwork is completed for all car sales.
Required to legally operate the vehicle on Australian roads. While most cars will be sold with time remaining on their “Rego” (registration), if the registration has expired, you will have to visit a VicRoads office (no appointment necessary) and pay a fee to register the car (and its license plates) for a full year. The no documentation is necessary to do this, just present a photo ID, and provide the car’s registration (plate number). For details on where to find a VicRoads office or information on how much your vehicle will cost to register, see http://www.vicroads.vic.gov.au/Home/Registration/
Transfer of Ownership
Only required when buying a used car. This paperwork should be signed by both you and the seller, and submitted to VicRoads as soon as possible after purchase. Completing this process will transfer the term of the registration for the vehicle to your name. To find the official Transfer of Ownership form, see http://www.vicroads.vic.gov.au/NR/rdonlyres/3E290CC4-48CB-4124-9288-C5AF196CE0FF/0/VicRoadsTransferForm1108.pdf. For information on how to submit it, see http://www.vicroads.vic.gov.au/Home/Registration/BuySellTransferVehicles/
All vehicles operating on Australian roads must be in possession of this certification. If a car you are purchasing is without certification, a Roadworthiness inspection can be done from almost any service station or garage. Upon successful certification, the certificate will be valid for 30 days, during which it will have to be presented to VicRoads. If buying a used car that has already been certified, submit this form to VicRoads as soon as possible (if it hasn’t been already). For more information on Roadworthy Certification, and how to obtain or submit, see http://www.vicroads.vic.gov.au/Home/Registration/BuySellTransferVehicles/Roadworthiness