The best first car: A buyer’s guide for new drivers in Australia

Buying your first car is a major step towards independence.
However, the process can require quite a bit of paperwork and decision making.

This is particularly true if you want to buy a car that not only looks good, but meets your practical requirements, offers all important safety features and won’t create unnecessary financial pressure once the glow of owning your first car has worn off.

To make things a little easier for new drivers, we’ve put together a buyer’s guide for first time drivers in Australia.

This will first help you identify what to look out for when buying your first car, take you through the best cars for new drivers in each segment of the market and then take you through the steps to buying a car for the first time, from finance to insurance.

CONTENTS

What you want, and need, from a first car

Australians who go shopping for cars can easily become overwhelmed by the variety of choices on offer in the new and used car market.

Not only does almost every manufacturer on the planet sell their vehicles in Australia, but Australians also have local builds competing for their attention.

And each of these makes and models comes with potential advantages and disadvantages.

Before we look at great cars for new buyers in each segment, it’s worth establishing a first car checklist for what young drivers should look out for in their first cars.

What you want, and need, from a first car

  1. Excessive engine power. P platers and learners are prohibited from driving high power vehicles in most Australian states (you can check the restrictions for your state here). In practice this means the engine’s power should be below 130kW per tonne. To determine whether a car meets this requirement, divide 1000 by the car’s weight in kilograms and multiply it by the engine power in kW.
  2. Fuel economy. A car with good fuel economy will frequently come paired with an engine that doesn’t raise any high-performance red flags with authorities. More importantly a fuel-efficient engine can represent significant savings at the pump over the lifespan of a vehicle, improving overall vehicle affordability. Finally, some fuel-efficient cars qualify for cheaper rates at some insurers.
  3. Safety. P platers and learners are the highest risk driver demographic in Australia, which means safety is a critical consideration when buying a first car. Fortunately, it is increasingly easy to find affordable vehicles with 5-star ANCAP ratings. Cars with higher safety ratings and good active safety features won’t just keep you safer on the roads – they’ll also attract lower insurance rates as they’re less likely to be involved in accidents.
  4. Maintenance and parts. Before settling on an older model car or one of the more exotic imports available in Australia, get information on the availability and cost of spares. If parts are scarce, expensive, or must be imported, this can significantly impact the cost and duration of maintenance and repairs. Expensive spares can also drive up the cost of insurance, as cars that are expensive to repair are expensive to insure.
  5. Size. Assess your practical requirements from a car before going shopping for one. Larger family cars and SUVs are built with specific drivers in mind, and these cars can cost a lot more without offering much utility to new drivers. If you’re a new driver, chances are the small or compact car models will serve your needs best. These tend to have features designed to appeal to young drivers and are ideal for shorter commutes and urban driving.
  6. Insurance. Consider making comprehensive insurance cover a basic requirement for your new car. As the law only requires you to take out compulsory third-party cover it can be tempting to skimp on insurance by driving with partial cover. This can pose a massive financial risk if you get involved in an accident. Get a comprehensive insurance quote on your vehicle before you make the decision to purchase.

Best cars for first time drivers in Australia

While the fundamentals of what you should look for in a first car remain the same across all market segments, the reality is that there are plenty of cars across various segments of the market that might meet your requirements depending on what you’re looking for from your first car, as well as your budget and even whether you’re a guy or girl.

Here’s a look at the three best cars for first time drivers across typical new driver car segments.

These vehicles combine 5-star ANCAP ratings with compact size, reliability and fuel efficiency.

Small cars and superminis

Small cars are the go-to market segment for most new drivers. There’s a good reason for this.

Not only are these small, cheap cars for first time drivers, but they’re also easy to park, relatively affordable to insure and are tailor-made for short city commutes.

Volkswagen Up! (from $5500 used, $13,990 new)

Volkswagen Up

The Volkswagen Up is one of the best first cars for new drivers in Australia, whether you’re purchasing new or shopping for a used car.

The Up! has everything you would want from good cheap cars for first time drivers.

Expect excellent fuel efficiency, class-leading safety features, and a variety of colour options and trim levels.

Ford Fiesta (2013 onwards, from $7500 used, from $13,420 new)

Ford Fiesta

If you’re looking for a little more power and space than you can get from the micro car segment and want to explore the supermini option, you can’t go wrong with the Ford Fiesta*.

This car blends style with safety and fuel efficiency. It is also considered one of the best first cars for teenage guys in Australia.

*Sport models are equipped with engines that will violate engine power restrictions in some Australian states and territories.

Toyota Yaris (2011 onwards, from $4700 used, from $13,860 new)

Toyota Yaris

The Yaris is the most compact car Toyota offers on the Australian market.

It comes standard with all the features that make this brand popular, including affordable cost of ownership, reliability and excellent safety features.

It’s a car a young driver will take several years to grow out of, which makes it one of the best cars for your first car if you’re buying new.

Also consider:

  • Honda Jazz (2014 onwards, from $6900 used, from $15,888 new)
  • Mazda 2 (2011 onwards, from $4750 used, from $18,999 new)
  • KIA Rio (2011 onwards, from $5500 used, from $14,990 new)

Good first used cars for new drivers

Buying a used vehicle as a first car can open a greater selection of vehicle options while allowing you to save money on your purchase.

The following are the best used cars for new drivers, covering all the bases we identified in what you want, and need, from a first car by providing good fuel consumption, reliability and excellent safety features.

Holden Spark (2016-18, from $8000)

Holden Spark

The Holden Spark is a compact Korean-built city car that has recently been discontinued in Australia.

This means that the second-hand market is the only place you’ll be able to get hold of this car.

Reasons why this is one of the best used cars for first time drivers include good fuel consumption, a 5-star ANCAP rating, air-conditioning and a 7″ infotainment system tailor-made for young drivers.

Fiat 500 (2008-15, from $4000)

Fiat 500

he Fiat 500 is arguably the best first car under $5000 in Australia.

It offers everything you’d want from good second-hand cars for first time drivers, including a 5-star ANCAP rating.

The Fiat 500’s super-efficient engine won International Engine of the Year in 2010.

It also happens to be compact, easy to drive and features distinctive, youthful styling based on a classic Fiat design.

Mazda 2 (2007-14, from $4750)

Mazda 2

The third generation Mazda 2 is one of best first cars under $10,000 in Australia.

In fact, low cost of ownership is this car’s most attractive feature.

It’s reliable and spares are readily available and affordable when it requires maintenance.

The Mazda 2’s fuel efficiency is also good at a touch over 6 litres per 100km, and it carries a 4-star ANCAP rating.

Best safe cars for teenagers in Australia

Safety is a major consideration for parents of young drivers, and if you’re one of these, then you are probably prepared to pay more for a first car that offers a full suite of active and passive safety features.

The good news is more cars carry 5-star ANCAP ratings than ever before, which means you aren’t forced to fork out for a premium badge in order to keep your young driver safe.

The following small and compact cars are ideal first cars for young drivers, with all variants carrying 5-star ANCAP ratings:

  • Volkswagen Polo (Feb 2018 onwards)
  • Kia Rio (Jan 2017 onwards)
  • Holden Spark (Mar 2016 onwards)
  • Mazda 2 (Nov 2014 onwards)
  • Honda Jazz (Jul 2014 onwards)
  • Honda City (2014 onwards)
  • Fiat Panda (2013 onwards)
  • Renault Clio (2013 onwards)
  • Ford Fiesta (2013 onwards)
  • Audi A1 (2010 onwards)
  • Ford Focus (2019 onwards)
  • Toyota Corolla hatch (Aug 2018 onwards)
  • Toyota Yaris (Nov 2017 onwards)
  • Honda Civic (hatch: 2017 onwards, sedan: Jul 2016 onwards)
  • Mazda 3 (Aug 2016 onwards)
  • Hyundai Elantra (Feb 2016 onwards)
  • Mitsubishi Lancer (Nov 2015 onwards)

Top ten best first cars in Australia

To wrap up our chapters on good first cars in Australia we’ve summarised our favourite picks.

Our list of the top ten cars for first time drivers includes:

  • Honda Jazz
  • Volkswagen Up!
  • Holden Spark (2016-18)
  • Mazda 2
  • Ford Fiesta
  • Toyota Corolla
  • Honda Civic
  • Mazda 3
  • Fiat 500 (2008-15)
  • Toyota Yaris

Car finance for first time drivers

Unless you have the savings to pay cash for a car, you’re going to need financial assistance to buy your first car.

Financing basically allows you to drive the car of your choice while you repay the cost of the car to the lender over a fixed period.

Car finance is affordable in Australia at current interest rates, which makes this a viable and popular option among first-time car buyers.

In order to enter a car finance agreement directly with a provider you’ll need to be:

  • aged 18 or above
  • able to offer proof of income through salary slips, bank transactions, tax returns or notices of assessment. Without these it is unlikely your loan will be approved.

If you meet these requirements you have a few different options for getting your car financed, as there are hundreds of car finance offers on the market.

Your options include:

  • Car loan. Credit unions typically offer the most attractive loans in this department, with many waiving service and application fees. Expect to pay in the region of 8% interest on these loans, although cheaper loans may be available on environmentally friendly vehicles.
  • Dealer finance. Many car dealerships will offer on-site finance and can rapidly approve loans in order to get cars off the dealership floor as quickly as possible. These financing agreements typically carry higher interest rates than financing offered via credit unions, so expect to pay interest of between 13% and 14% on your loan.
  • Manufacturer finance. If you’re buying new you can look around for car manufacturers offering special deals on car financing. These can include agreements which offer you a car on affordable instalments, with a single ‘balloon’ payment typically due at the end of the finance period. If you don’t pay that on schedule, you’ll need to return the car to the dealer.
  • Novated lease. This involves your employer financing the car for you and docking the instalment amounts from your salary before tax is paid. This has a few perks. If you’re a first-time car buyer with no credit history, your employer can secure finance for you, and you’ll pay less tax on your salary. However, watch out for Fringe Benefit Tax, which comes into play in these types of arrangements and can reverse any tax savings you make on the deal.
  • Alternative credit sources. It is also possible to buy cars using other credit sources like credit cards or redraws on mortgages. This is not the best way to buy your first car if you’re a young driver without an established credit rating and don’t have a mortgage you can draw cash out of. Furthermore, the cost of credit for these options will typically be much more than finance products designed specifically for car buyers.

The fine print

If you’re a first-time car buyer, it’s likely you’ll be most tempted by the option that allows you to get the car you have your eye on at the most affordable instalment as quickly as possible.

However, before signing on the dotted line on a car finance agreement that looks attractive, there are some important key terms and concepts worth understanding.

  • Balloon payments. Balloon payments allow you to decrease the amount of money you obtain finance on by setting aside a large percentage of the car value for payment at the end of the loan term. For example, many people will agree to pay 30% of the car value on the final instalment. While this drives down monthly instalments, it usually results in you having to re-finance the balloon amount at the end of the lending agreement. This can significantly increase the real cost of the car over the long term, once interest is factored in.
  • Secured loans. These effectively use the financed asset as security against the loan, which means your car can be legally and rapidly re-possessed by the financing institution if you become unable to meet the payment obligations on your car. Secured loans are one of the reasons why new cars attract better interest rates than used cars, as used cars provide relatively poor security against a car loan.
  • Fixed interest rates. Fixed interest rates protect you against fluctuations in the national interest rate, ensuring your instalment stays fixed over the period of your car loan. The price for this is that the fixed interest rate will typically be a couple of percentage points higher than if you choose a flexible interest rate.
  • Flexible interest rates. Flexible interest rates are tied to the interest rates set by the Australian Reserve Bank. At the time that finance is secured this will be lower than the fixed interest rate alternative. Flexible interest repayments will decrease when interest rates are cut – and expose you to higher repayments when interest rates are hiked.

Now that your first car finance options have been explained, there are a few final first car finance tips to be aware of before you sign on the dotted line.

  • Unsolicited insurance products. Many dealers will add insurance products like loan protection insurance and gap cover to your car’s quote, increasing the price of your car. Have these removed and get your insurance products directly from an insurer.
  • Extended warranties. Extended warranties are intended to cover your car once it goes out of manufacturer warranty or to cover issues not covered by your factory warranty. This is effectively another form of unsolicited insurance, so have it removed from your quote.
  • Pressure selling. Car dealers spend every day of their lives refining their sales skills and will usually have a team that can use pressure selling to force you to make a snap decision. Never make an on the spot decision, and instead request a time-out to think through your purchase.
  • Failing to shop around. When you’re getting finance, always shop around for better deals. Never go with the first offer you are presented just because it satisfies your immediate requirements. Once you have that offer, use it as a bargaining point to get other credit providers to offer you a better deal.

How to buy your first car with no credit

If your income or credit rating prevents you from qualifying for car finance, don’t despair.

You still have the option of co-signing on a credit agreement with a family member who qualifies for finance.

Another popular option is to ask your parents to apply for car finance on your behalf, and to then refund them for instalments on your car once you have taken ownership of your car.

Should your first car be new or used?

The debate over new vs used cars may not have relevance for many young drivers.

If you get a used car as a hand-me-down or only have enough cash to buy an older second-hand car, the debate over whether a first car should be new or used is pretty much settled there and then.

Drive the used car until other options become available.

However, if you’re given the option between a new and used vehicle consider the pros and cons of each option as they’re presented below.

Factor New Used
Purchase price Higher first car price Lower first car price
Maintenance cost Negligible during warranty and service plan Can be expensive and unpredictable
Warranty Comes with factory warranty Warranty must be purchased separately
Reliability High degree of reliability, most issues covered by warranty Risk of buying a ‘lemon’/unpredictable reliability
Resale value Stiff depreciation during first three years of ownership Retains value better over the short term
Safety Retains value better over the short term May be missing important safety updates
Fuel efficiency Retains value better over the short term May have older, less fuel-efficient engines
Finance Preferential finance rates Less favourable finance agreements
Insurance Higher replacement cost means higher rates Lower insurance rates due to lower replacement cost

As you can see there are important pros and cons that apply to both options. Fortunately, a compromise exists, which is to shop for dealership demo models.

These vehicles are typically used for test-driving at dealerships and as courtesy cars and are sold as newer models become available while still on very low mileage.

These cars offer the best of both worlds, as they offer the safety features and technological enhancements of brand-new cars, while still being under warranty, but won’t cost as much or depreciate as quickly as new versions of the same model.

If you’d like more information on whether you should buy a new or used first car, we’ve covered the debate in more detail here.

How to buy car insurance for the first time

Whether you buy new or used, or buy your car cash or on instalment, you’re going to need at least some insurance cover when you purchase your own vehicle.

Here are your first car insurance policy options, from cheapest to most expensive:

  • Compulsory Third Party (CTP) insurance. This is mandatory cover that you’ll get automatically when you register your vehicle. This covers any costs arising from personal injury claims in the event of a car accident you’re involved in.
  • Third party accident insurance. This cover pays out third party claims for damages to property in the event you cause an accident. However, it won’t cover any damage to your own vehicle or property.
  • Third party, fire and theft. This provides cover for both third-party damages as well as the loss of your own vehicle due to fire or theft.
  • Comprehensive insurance. Covers both third-party claims and a wide variety of possible claims arising from damage to or loss of your vehicle, including car accidents, malicious and weather damage to your vehicle. Comprehensive insurance is usually a requirement for obtaining finance on a vehicle.

While comprehensive insurance cover is the most expensive option on this list, it is also the best first-time car insurance option and should be a priority consideration when calculating how much car you can afford.

Without comprehensive cover the consequences of even a minor car accident can be financially catastrophic.

However, comprehensive cover can be very pricey for young or inexperienced drivers, as they are considered high-risk demographics and lack established claims histories.

Fortunately, it is becoming easier for inexperienced and young drivers to get relatively cheap first-time car insurance by using cutting-edge insurers like UbiCar.

UbiCar uses the latest telematics technology to score your driving and calculates your insurance rates based on how safely you drive.

What UbiCar customers say

Savings and benefits users now enjoy since switching to UbiCar*
Luana with savings

"My massive monthly savings
are fantastic for my family"

Luana - New South Wales
Jillian with savings amount

“UbiCar has motivated me to be a better,
safer and more considerate driver."

Jillian - South Australia
Luke with savings amount

“UbiCar doesn’t stereotype like other
insurance companies.“

Luke - New South Wales

*Savings are factual and based on comparison between the customer’s current Comprehensive Car Insurance policy with UbiCar as of December 2018 and their policy with their previous insurer. Premiums and savings may differ depending on individual circumstance.

How it works:

FAQs

Do you have more questions about buying your first car? Read through our FAQ to find the answers to some common questions from first time car buyers.

As a rule of thumb, there’s little sense in getting your own car as a learner driver.

You won’t be driving frequently or without supervision, so it makes more sense to bide your time in the family car during this period.

In addition, insurers like UbiCar won’t require learner drivers to get separate insurance cover if they are driving the family car.

This takes all the hassle out of insurance.

P plates are the natural step-off point for automotive independence.

However, even here it’s worth avoiding an impulsive buy and asking yourself if a new car is a need or a want.

If you’re a P plater, living at home and don’t require a car for regular use, it will still make more sense to drive the family car and have yourself listed on the family policy.

With that in mind you should get your first car when:

  • you have graduated to your P plates
  • and using the family car becomes impractical due to relocation to university or because you’ve become the most frequent user of the vehicle (in which case you’ll typically be required to register your own policy)
  • and you have the financial means to afford a vehicle as well as the costs of ownership, including insurance, fuel, licensing and maintenance costs.

Whether buying new or used you’ll be required to register the car in your name, which will require:

  • Proof of identity.
  • Proof of address.
  • Proof of registration entitlement (i.e. a document saying you will be the new owner of the vehicle).
  • In many states a safety check report issued by an authorised safety check station is required for vehicles over a certain age, or when vehicles are transferred or put up for sale. Requirements differ by state and territory.
  • Number plates, if available.
  • A completed registration form.
  • The cash to cover the registration costs.

If you are buying from a dealership, they will usually help you register your vehicle once you have provided them with the relevant proof of identity and address.

Other things you might need for your first car depend on whether you are buying it cash or having it financed.

If you are buying a used car for cash, you should get:

  • A full service history of the car you are considering buying, along with its operating manual.
  • A warranty – a short term warranty is typically a legal requirement for vehicles that are less than 10 years old. Older cars or ones with higher mileage may not require a warranty and you will need to purchase one yourself.

If you are buying a car under finance, there will be additional requirements to prove you can meet your monthly payment obligations.

So, if you are financing your first car you’ll need:

  • Proof of income, which can include salary slips, bank statements or copies of contracts that supply a fixed income.
  • Proof of comprehensive insurance (financial institutions will not approve a loan on a vehicle without comprehensive cover, as this is at their risk).

A car’s ‘make’ refers to its manufacturer, or the company that builds and distributes the vehicle. Examples of vehicle ‘makes’ would be Toyota, Ford or Holden.

Where you should buy your first car will depend on whether you buy a used or new vehicle.

The best place to buy your first car if buying new is directly from authorized manufacturer dealerships.

Used cars can be purchased either directly from the seller or from a used car dealership.

Whichever of these two options you choose, always ensure you have any used car you are considering buying checked out by an independent mechanic and preferably purchase a car that comes with an extended warranty.

The financial rules when it comes to buying your first car don’t differ much from the rules that apply to other car owners.

  • Establish exactly how much money you have available to spend on your car every month.
  • Ensure that this amount is proportional to the value that the car will add to your life and is within your financial means.
  • Factor ongoing associated expenses such as fuel, insurance and maintenance into your calculations of how much to spend on your first car.

n Australia first car prices can be very reasonable, and you can get high quality used cars for between $4000 and $6000.

These include some of our recommended cheap first cars for new drivers such as the:

  • Volkswagen Up
  • Fiat 500
  • Toyota Corolla.

The date of first payment on a car that has been financed will depend on where you get your finance.

Some financing institutions will require you to make your first payment within a month of buying a car, while other providers offer a grace period of 30 days or more before your first car payment is debited, which means you can effectively ‘skip’ one or more car payments.

First time car buyers are technically subject to the same interest rates as other car buyers, as financing institutions do not factor driver experience into interest rates.

However, your credit profile may affect the interest rates you are offered by financiers, and younger drivers may not have the type of established credit profiles that attract preferential rates.

You can expect to pay interest rates of between 5% and 14% depending on a variety of factors, including:

  • The current interest rate as set by the Australian Reserve Bank.
  • Your credit rating, with lower interest rates typically extended to individuals with better credit ratings.
  • Whether you take a fixed or variable interest rate, the latter will see your car repayments fluctuate as the Australian Reserve Bank makes changes to the interest rates.
  • Whether you take an unsecured loan or a secured loan (a loan which uses another asset as security).
  • Whether a dealer offers you a preferential rate for a specific model of vehicle that is being promoted.
  • Which company offers you the loan, as different providers will compete to offer attractive interest rates to attract customers, with credit unions typically offering the best rates.

According to research done in the United States, the average age of the vehicle on the roads is around 11.4 years, while most drivers hang onto a new car for around 6 years.

However, the averages hide a lot of variation within the car owner population, as many people will hang onto their cars for longer or shorter periods.

This reflects the fact that how long you keep your first car will depend on variables that will be unique to your situation, including:

  • Whether you buy the car new or used.
  • What the mileage on the vehicle is if bought used.
  • Whether or not your requirements from your car change during the ownership period.
  • How much maintenance your car requires, and how much time and money it requires for repairs.

This means it’s not practical to recommend keeping any vehicle for a specific number of years.

Instead it makes sense to replace a vehicle once the cost of maintenance and repairs push the cumulative monthly costs of ownership above what you would be paying for a comparable replacement car.

You may also want to replace your car once your requirements outgrow what your current vehicle can give you, for example if you have a family and require a bigger car.

The initial costs of purchasing your first car in Australia will vary slightly depending on whether you are buying a new or used vehicle, whether the vehicle will cross state borders during the transfer of ownership, and which state or territory you live in.

However, as a rule of thumb the following costs will apply to vehicle purchases:

  • A registration transfer fee.
  • A stamp duty which will be payable at vehicle registration. In some states this can be a significant additional expense on top of the car price.
  • You may need to pay annual Motor Vehicle Tax on the car if this is due for renewal when you buy it.
  • Compulsory Third Party (CTP/green slip) insurance is payable in all states when you register a vehicle under your name.
  • In some states and territories sellers are required to obtain a safety check report issued by an authorised safety check station if a vehicle is over a certain age or is being transferred between states. In some cases, the seller may pass this cost onto the buyer.
  • If you buy a car that is classified as a luxury vehicle, as classified by its sales price at the dealership, the car will be subject to an additional Luxury Car Tax.

Expert claims around the average depreciation rate for new cars in Australia vary, with depreciation rates between 14% and 19% quoted for the first year of ownership.

These averages have limited relevance as new car depreciation rates are dependent on the make and model of vehicle you are purchasing.

Cars that are in higher demand in the second-hand car market will depreciate more slowly than cars that attract less general interest in that market.

The extent to which you have customized a car, and how much value these customizations retain in the used car market also influences how much your car will depreciate by in the first year of ownership.

What mileage you should look for in a first car depends to a large extent on the manufacturer and model, how and where the car was driven and whether its maintenance was kept up to date.

A reliable car like a Toyota Camry that has been well driven and regularly serviced can provide several years of reliable use at a mileage of 120,000km.

The best way to determine whether a used car’s mileage could cause issues is to have it assessed by an independent mechanic to get an objective idea of what the costs of ownership are likely to be, given the car’s mileage.

Cost of ownership, reliability and safety are the primary considerations for first time car buyers.

In Australia several brands not only offer all three of these, but also manufacturer models with young and first-time buyers in mind.

Good first car brands include:

  • Toyota
  • Ford
  • Volkswagen

Any car with a 5-star ANCAP rating can be considered a safe first car to buy, although first time buyers should avoid high performance vehicles even if they carry 5-star ratings.

ANCAP tests most car models available in Australia and scores them across critical safety features.

Cars with 5-star ANCAP ratings perform close to optimally across all critical safety tests.

If you’re wondering what the best classic cars are for first time drivers, the answer is that none of these vehicles are suitable for a first-time driver.

These cars have several major issues which make them more suitable for serious hobbyists and collectors with more experience driving and maintaining vehicles.

These issues include:

  • Parts are scarce and expensive and maintenance issues with these cars are therefore likely to be very expensive and result in significant down time for the car.
  • Insurance rates will skyrocket if you buy a classic car as an inexperienced driver. Many insurers will also charge additional excess on classic cars if they are in accidents.
  • Classic by default means that these cars were built when fuel efficiency was not a concern. They will burn through fuel. Furthermore, obtaining the right grade and type of fuel for a classic car can be a complicated and expensive exercise.
  • Classic cars are lacking in a number of critical safety features which are standard in newer vehicles.

4×4 vehicles are generally not suitable for first time car buyers, who are typically using their vehicles for short urban commutes.

A 4×4’s expensive purchase price, maintenance, insurance and fuel costs also disqualify it as a good first car.

In addition, specialized driving skills are required to drive these cars safely.

However, 4x4s are a necessity in some parts of rural Australia with dirt roads.

If you’re a new driver living in one of these areas, the Suzuki Jimny is a good option to look at.

This 4×4 is both compact and relatively affordable, and is renowned for its ability to handle rough roads and rugged terrain without costing you a fortune at the petrol pump.

The safest first car for a teenage will be one that has a 5-star ANCAP safety rating, as well as a smaller engine that discourages speeding and reckless acceleration.

Many manufacturers have released cars that meet these requirements and are specifically targeted at parents buying a first car for a teenager.

Good first cars for 17 year olds and 18 year olds include:

  • Holden Spark (2016-18)
  • Volkswagen Up!
  • Fiat 500.

In Australia driving a sports or high-performance car as a first car is not recommended for the following reasons:

  • Most sports cars, including sports variants of popular small and compact cars, have engines that will violate restrictions on high-performance vehicles for novice drivers in many Australian states and territories.
  • Sports cars are typically flagged as higher risk by insurers due to the higher accident rates for these vehicles – this translates into more expensive insurance rates.
  • A surprising number of sports cars do not have 5-star ANCAP ratings, which means critical protection is missing when you need it most in a vehicle.
  • High-performance vehicles require driver experience and sometimes even specialized driving skills to handle safely and effectively.

If you’re set on having a sports car as a first car, a Mazda MX5 equipped with one of the smaller engine options will give you the closest experience of a sports car as a first car.

If you assess a Range Rover using the key factors identified in what you want, and need, from a first car the answer would be that a Range Rover is not a good first car.

While safety features are excellent, the engines are powerful and thirsty, and these vehicles are expensive to insure.

Driving and handling a Range Rover well, typically also requires a lot of driving experience.

Pros:

  • Recent models all carry 5-star ANCAP ratings.

Cons:

  • While most Range Rovers won’t raise red flags for power to weight ratio, these cars are overpowered for short urban commutes.
  • Fuel economy for this class of vehicle is relatively poor, and older models are likely to be fuel guzzlers.
  • Maintenance problems are complex, and parts are costly.
  • The Range Rover is oversized for smaller households.
  • Expensive to insure.

If you assess a Mitsubishi Lancer according to the factors identified in what you want, and need, from a first car the answer would be that Mitsubishi Lancers are reasonably good sedans for a first car.

While the safety features are satisfactory, and the car is solidly built and reliable, engines are not particularly fuel-efficient.

Pros:

  • Most models will have 4 or 5-star ANCAP ratings (an additional star is awarded to models with curtain airbags).
  • Mitsubishi Lancers are solidly constructed vehicles and the relative lack of high-tech elements in the car can reduce cost and complexity of repairs.
  • Available as a hatchback.
  • Reasonable insurance rates.

Cons:

  • Doesn’t make use of smaller turbo-injected engines popular among other manufacturers selling vehicles in this class, which means bigger engines that are heavier on fuel.

The BMW M3 is not a good first car according to the factors we identified in what you want, and need, from a first car.

Not only will this vehicle trigger high-performance vehicle restrictions for novice drivers in many states, but cost of ownership will push it beyond the reach of most first-time car buyers.

Cons:

  • The BMW M3 has a high-performance engine, with most models delivering over 143kW of power. While some heavier models with less powerful engines may scrape in at under 130kW/tonne, the majority of BMW M3 models will violate high power vehicle restrictions for novice drivers in many Australian states.
  • The BMW M3 is a sportscar and will therefore have a higher risk rating among insurers and will attract higher premiums.
  • The BMW M3 will be expensive to repair and maintain.

Pros:

  • Recent generations carry 5-star ANCAP ratings.
 

The Mercedes C Class is not a good first car, taking the factors we identified in what you want, and need, from a first car into account.

This is down to the fact that this is simply too much car for the first-time car buyer, with a powerful engine and a high cost of ownership in terms of vehicle cost, maintenance and insurance.

Cons:

  • Many variants of the Mercedes C Class are equipped with high power engines that will violate restrictions on vehicles producing more than 130kW/tonne. Even for models with less powerful engines, the power is excessive for first time drivers.
  • The Mercedes C Class is expensive to maintain and repair once it is out of warranty.
  • Because the Mercedes C Class is expensive to repair and replace, this will raise insurance rates. Sports models will fall into higher risk brackets, further raising insurance costs.

Pros:

  • Newer models have good fuel efficiency.
  • 5-star ANCAP rating.

A Ford Mustang is a poor choice for a first car in Australia according to the factors we considered in what you want, and need, from a first car.

Not only does the Mustang have an overpowered engine for first time drivers, but this car also scored 3 stars in ANCAP testing, which suggests the safety features are not matched to the vehicle’s performance capabilities or price.

Cons:

  • Expensive to purchase and insure
  • High power engine options which will trigger performance restrictions for novice drivers in many Australian states and territories
  • Poor fuel economy
  • Poor ANCAP rating.

If you’re set on having a sports car as your first car, then models of the Mazda MX5 with smaller engines are appropriate first cars, according to the factors we considered in what you want, and need, from a first car.

This is due to this vehicle’s safety, impressive fuel efficiency, compact design and affordable cost of ownership.

Pros:

  • Good fuel efficiency.
  • Compact, easy to park and nimble.
  • 5-star ANCAP rating.
  • Affordable spares and maintenance.

Cons:

  • Expensive compared to other first car options.
  • Insurance rates more expensive than less sporty options.
  • Larger engine options will trigger power to weight ratio restrictions for novice drivers in Australia.

Whether or not a BMW is a good first car will depend on the model and age of the vehicle in question.

With the possible exception of the 3 Series, most BMW models are not suitable for new drivers due to the higher power output of the engines, as well as cost of insurance and maintenance once out of warranty.

Below we list the pros and cons for the BMW brand in general, according to the factors considered in what you want, and need, from a first car.

Pros:

  • Many models have 5-star ANCAP ratings.
  • Newer models have smaller, more fuel-efficient turbo engines.

Cons:

  • Repairs and maintenance are frequently expensive and complicated.
  • Many BMWs will fall into high risk brackets among insurers, attracting higher rates.
  • Many BMW models will violate restrictions on high-performance vehicles for novice drivers.
  • Larger and more powerful models will not match the fuel efficiency of smaller BMW models.

Whether or not an Audi is a good first car will depend on the model and age of the car in question.

Entry level versions of models like the A1 are designed specifically with younger and first-time buyers in mind.

However, larger and sports Audis are more suited for mature and experienced drivers.

We consider the pros and cons of Audi as a first car below, according to the factors considered in what you want, and need, from a first car.

Pros:

  • Entry level versions of the A1 and A3 are equipped with small, fuel-efficient engines that will not violate power to weight ratio restrictions for novice drivers.
  • Older versions of the A1 and A3 come in compact coupe configurations and are ideal for urban commutes.
  • Reasonable insurance rates on entry level models.
  • 5-star ANCAP rating.

Cons:

  • Expensive to repair and maintain once out of warranty.
  • Many models with larger engines will violate restrictions on high power vehicles for novice drivers in Australia.
  • Sport and premium models will attract expensive insurance rates.

A BMW 3 series is a moderately good first car for a first-time buyer when considering the factors we identified in what you want, and need, from a first car.

While engine power can be a concern on performance models and this is not a cheap first car option, its safety and fuel efficiency mean that it is an option worth looking at for first time buyers with bigger budgets.

Cons:

  • Newer models will be expensive to insure.
  • Expensive repair and maintenance costs once service and warranty cover lapse.
  • Size and specifications may be excessive for many people buying their first cars, and young drivers in these vehicles may attract unwanted attention from authorities.

Pros:

  • Newer models have excellent fuel efficiency and hybrid options are available.
  • 5-star ANCAP rating for the last two generations.

A Honda Civic is a good choice for a first car, and is one of the best first used cars to buy when considering the factors we identified in what you want, and need, from a first car.

While not the most exciting car on the market, its reliability, fuel-efficiency and low cost of ownership make it one of the best options on the market for new drivers.

Pros:

  • Well-built car with minimal maintenance requirements and excellent longevity.
  • Affordable to insure due to modest replacement and repair costs.
  • 5-star ANCAP rating.
  • Fuel-efficient.

Cons:

  • Relatively large, bulky car for first time drivers.
  • Sport models with larger engines will violate high-performance vehicle restrictions for novice drivers.

The Toyota 86 is not a good option for a first car, based on the factors we considered in what you want, and need, from a first car.

The power of the engine, high cost of ownership and relatively poor efficiency mean this sportscar is best reserved for more experienced drivers with bigger budgets.

Cons:

  • While the engine scrapes under the 130kW/tonne power to weight ratio restrictions for novice drivers, the engine performance is excessive for a first-time driver.
  • Poor fuel efficiency.
  • The Toyota 86 is a sports car, and as such will be regarded as high risk by insurers. This along with replacement cost will reflect in your insurance rates.
  • Maintenance and repairs can be very expensive once out of warranty.

Pros:

  • Compact and stylish.
  • 5-star ANCAP rating.

An Audi TT is not a good first car or suitable for inexperienced drivers according to the criteria we identified in what you want, and need, from a first car.

While there’s plenty to like in terms of the car’s appearance and specifications, its performance and cost both exceed the requirements of typical first-time car buyers.

Cons:

  • Most engines available in the last two generations of the Audi TT will violate prohibitions for performance vehicles for novice drivers in many Australian states and territories
  • The Audi TT is expensive to repair and maintain once its service plan and factory warranty have expired.
  • Expensive to insure as this car tends to be driven like a sports car and is assessed for risk accordingly.
  • The TT’s 4-star ANCAP rating is lower than it should be for a sports car from a premium brand.

Especially when bought used, Toyota Camrys are cheap, reliable first cars, making this one of the best options if you’re shopping for cool first cars under $10,000.

Pros:

  • Reliable and relatively affordable to repair and maintain.
  • Camrys built from 2011 onwards have a 5-star ANCAP rating.
  • Affordable to insure.

Cons:

  • Fuel consumption is average relative to its low powered engines.
  • Car might be oversized if only used by the driver.

According to the guidelines set out in what you want, and need, from a first car, a Toyota Prius is a moderately good choice for a first car for novice drivers.

The vehicle is best suited to first time car buyers with a bigger budget who are in the market for a mid-sized sedan.

Pros:

  • Toyota Prius are fuel-efficient first cars.
  • Low maintenance and repair costs.
  • Affordable to insure, relative to its replacement cost.
  • 5-star ANCAP rating.

Cons:

  • Car will be oversized and overpriced for many first-time car buyers.

The Subaru BRZ is an alternative name for the Toyota 86, which we review as a first car above.

While the aesthetics and off-road capabilities of a Jeep may make cars by this manufacturer an attractive option for first time car buyers, our guidelines to what you want, and need, from a first carsuggest that it is not a good option for a first car.

Cons:

  • Oversized for novice drivers, and relative lack of responsiveness on inputs can make this a hazardous vehicle in the hands of an inexperienced driver.
  • High fuel consumption due to relatively large and inefficient engines.
  • Expensive to insure due to high cost of replacement.

Pros:

  • 5-star ANCAP rating (however note that the typical Jeep’s high ground clearance places it at increased rollover risk).

The Mazda 6 is a good first car option for first time car buyers looking for a large family sedan, offering reasonably good fuel efficiency and excellent safety features.

However, it is an unsuitable option for younger first time car buyers according to the guidelines we set out in what you want, and need, from a first car.

Pros:

  • 5-star ANCAP rating.
  • Moderate fuel consumption for its size.
  • As a popular family car, it falls into lower risk categories and can qualify for cheaper insurance rates.
  • Mazda vehicles are reliable and relatively affordable to maintain and repair.

Cons:

  • Models with turbocharged engines will violate restrictions on high-performance vehicles for novice drivers in some Australian states.
  • Aimed at families, this car is going to be oversized for many younger and inexperienced drivers.

With its attractive, modern design and low cost of ownership, the Ford Focus is a good choice for a first car according to our guide to what you want, and need, from a first car and is also one of the best second-hand cars for first time drivers.

However, young drivers should avoid the high-power sport versions of the car as these may trigger engine restrictions for novice drivers.

Pros:

  • Compact and designed to appeal to younger drivers.
  • Non-sport models will be affordable to insure.
  • Affordable maintenance and repairs.
  • 5-star ANCAP rating.

Cons:

  • Older generations deliver average performance in terms of fuel efficiency.
  • The engines on sports models (the Focus ST) will fall foul of high-performance engine restrictions for novice drivers in several Australian states.

The BMW 5 Series is not suitable for first time drivers according to our guide to what you want, and need, from a first car.

While it’s safe and impressively light on fuel, it’s also a premium executive vehicle that offers more car than a first-time car buyer typically requires.

Cons:

  • Most engines in this range will trigger engine power restrictions for novice drivers in many Australian states.
  • Expensive to repair and perform maintenance on once out of warranty.
  • High replacement cost.
  • Oversized and excessive specifications for first time car buyers.

Pros:

  • 5-star ANCAP rating.
  • Some models deliver outstanding fuel economy.

The BMW 3 series is moderately suitable for first time car buyers. We discuss the pros and cons of BMW 3 Series vehicles as first time cars above.

Safe and reasonably affordable to own and maintain, the Nissan Altima is a good option for first time car buyers – specifically those looking for larger family cars with bigger engines.

Pros:

  • 5-star ANCAP rating.
  • Reasonable repair and maintenance costs.
  • Reasonably priced insurance rates because the car is popular amongst relatively low risked segments of the population.

Cons:

  • Older generations all have relatively large engines which are not particularly fuel-efficient. While the latest generation offers good fuel efficiency, the larger engines options will trigger restrictions on high power vehicles for novice drivers in some states
  • This is a medium sized sedan aimed at the family market and will offer too much car for many first-time buyers.
 

Whether or not a Mercedes is a good first car depends largely on the model you are considering and its age.

Older models with standard engines can be acceptable options for first time drivers. However, newer models are generally not ideal cars for first time buyers.

Pros:

  • Mercedes has a reputation for producing safe cars, and even much older models will tend to offer good safety features compared to other makes and models of the same age. Latest generation models will carry 5-star ANCAP ratings.

Cons:

  • While older models can be very reliable, all Mercedes vehicles are expensive to maintain and repair using authentic parts.
  • Insurance rates will reflect car replacement price, and you can expect insurance to be more expensive compared to other options that do not carry premium badges.
  • Large engines in older models will be heavy on fuel, while many of the more fuel-efficient engine options in newer models will violate restrictions on high power engines for novice drivers in many Australian states.
  • Many models will be oversized for first time car buyers and are more suited to more experienced drivers looking for premium family cars, executive sedans or high-performance vehicles.

According to our guidelines to what you want, and need, from a first car the Hyundai Sonata is a moderately good option for a first car for first-time buyers specifically looking for mid-sized sedans.

Pros:

  • 5-star ANCAP rating on latest generation.
  • Reasonable insurance rates.
  • Reliable, average maintenance and repair costs.

Cons:

  • Poor fuel consumption relative to the low-power engines on most models.
  • Oversized for first time buyers looking for more compact vehicles.
  • Older generations do not carry 5-star ANCAP ratings and do not offer adequate safety features.

A Chevrolet Camaro is not a good option for a first car according to the guidelines we identified in what you want, and need, from a first car.

As is the case with many other sports cars on the market, its high-performance engine, poor fuel efficiency and high cost of ownership mean this car is best suited to experienced drivers with bigger budgets.

Cons:

  • The latest generation of Camaros will violate restrictions on performance vehicles for novice drivers in most Australian states and territories. Even for drivers on a full license the high-power engine options are unsuitable for first time car owners.
  • Chevrolet does not have an established long-term presence in Australia, which will negatively affect the availability of parts, repair costs and repair waiting times.
  • Very poor fuel efficiency.
  • Expensive to insure due to falling into a high-risk car segment.
  • While third generation and prior Camaros were compact vehicles, the latest generations of Camaros are relatively large for a sports vehicle and will be too much car for most first-time car owners.

BMW 3 series vehicles are moderately suitable cars for first time car buyers. We discuss the pros and cons of getting a BMW 3 series car above.

The Ford Falcon is a moderately good option for a first car according to our guidelines in what you want, and need, from a first car.

Manufactured in Australia, the Falcon offers low cost of ownership and a good safety rating. However, many first-time drivers will find it oversized and cumbersome for their needs.

Pros:

  • Australian made vehicle which reduces maintenance and repair costs, as well as repair wait times.
  • 5-star ANCAP rating.
  • Affordable to insure.

Cons:

  • Mediocre fuel efficiency.
  • A full-sized sedan better suited as a family car than as an option for a first-time buyer.

Also known as the Honda Jazz, Honda Fit vehicles are good small cars for your first car.

Purpose-built for first time car owners, the Honda Jazz offers many of the features and qualities we considered essential in our discussion of what you want, and need, from a first car.

Pros:

  • Compact and affordable vehicle targeted at younger and first-time buyers.
  • 5-star ANCAP rating.
  • Affordable insurance rates.
  • Affordable to maintain and repair.
  • Good fuel efficiency.

The Mazda RX8 is not a good first car for a first-time buyer, when considering the guidelines set out in what you want, and need, from a first car.

Expensive to own and maintain this car is also heavy on fuel and is likely to attract high insurance rates.

Cons:

  • Several known engine issues affect this model, which can result in expensive repairs and significant wait time on these repairs.
  • This car has not been tested or rated by ANCAP. While Euro NCAP testing assigns it 5-stars, it achieved 4-stars on several key measures in testing by the NHTSA in the United States.
  • High fuel consumption.
  • Expensive to insure as it falls within the sportscar segment.

Pros:

  • Compact coupe design.
 

A Holden Commodore is not a good first car option according to the guidelines identified in what you want, and need, from a first car.

While it’s a local build that is relatively affordable to maintain and repair, older models feature excessively powerful engines that are heavy on fuel.

Pros:

  • Between 1978 and 2017 this model was manufactured in Australia. This improves parts availability and reduces the cost of maintenance and repairs.
  • Second-hand models will be relatively inexpensive to insure.
  • The current and previous generation scored 5-stars in ANCAP safety tests.

Cons:

  • Older generations of Holden Commodores did not achieve 5-star ANCAP ratings and would be considered unsafe for first time drivers.
  • Although the latest generation of Holden Commodores offer decent fuel efficiency, older models will be heavier on fuel.
  • While most Commodores will scrape beneath state restrictions on high power vehicles, the engines tend to be large and powerful and therefore unsuitable for first time drivers.
  • Oversized for most first-time buyers.

The Mitsubishi Colt is a poor first car option based on the requirements for first time buyers identified in what you want, and need, from a first car.

Most notably the car has a 3-star ANCAP rating which makes it significantly less safe than competing vehicles in its segment.

Cons:

  • 3-star ANCAP rating, which suggests significantly more risk of death or injury in an accident than comparable vehicles with 5-star ratings.

Pros:

  • Good fuel efficiency.
  • Available in configurations targeted specifically at new and young buyers.
  • Affordable to purchase and insure.
  • Relatively low running and maintenance costs.

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