Sub Compact purchase Another new over used cash or credit thread

[Bexiesbruv]

I am in Canada and all figures are CAD$
This thread got longer than I anticipated, so my apologies for that.
I have read many of the cash/credit new/used threads here and elsewhere with a great deal of interest as I am now in the market to buy something to help me on our 3 acres.
Here is my question and if anyone is interested, my thoughts over new/used in my current situation.

What does new equipment depreciate by per year? Assume the equipment is well maintained and does about 65hrs per year.
Would it be 30% once its out the dealers then 1k per year thereafter. I base this on the pricing of a couple private sale prices locally.

So, given that I by new or used, the eventual resale value of the equipment will come into play, either with the sale of our acreage or separate from it. So regardless what I pay now, there will be a payback at some point in the future to offset the outlay.

Currently looking at a 2011 Kubota 2320 at 13.5k with a LA304 front end loader, back end finishing mower, and drag box, 228hrs
Kubota B 1550 HST for 11.7k 965hrs
a couple MF 1710's
and
a new BX2370-1 with Fel, finishing mower and grading scraper for 24k plus 2.5k down and zero% over (currently) 84 months.

I'm more inclined to go for the 2320 if I can get a better price with my LOC then once other debt is gone, pay it down quicker.

The following is more putting my thoughts down for clarity.

We will likely sell up in maybe 6 years (all our kids will be gone by then and most of our pets will have been buried in the garden). If we are still fairly active and there is no reason to think otherwise, we might stay, but its unlikely.
So, on the basis of much that I have read, the incentives (for want of a better word) for dealers to sell product on credit with 10% down are greater than perhaps doing a (not so steep) discount for cash. I'm not sure I agree with this but it appears to be a recurring comment in the threads I have read. Sub Compacts are popular so no need to discount.

I have a fairly good line of credit that I could use for a used equipment purchase, but obviously I am aware that the deal is going to cost me about 2.5-4k over the term I would pay down my LOC, depending on what I buy
I will be debt free in several months and its pretty enticing to stay that way and just save a bit and buy used for cash at the end of this year and just muddle through until then.
Or
I could leave my LOC alone and buy new with the 10% down and balance at zero% and tie the end date in with when we are likely to sell up.

 

[JK22]

It depends on what the rate on your current LOC is. If high... pay off your LOC and get the "free" money from Kubota at 0% (Even if markup if 10%, that still only comes out to an effective rate of less than 1% per year after you figure time value of money/inflation).

 

[Bexiesbruv]

It depends on what the rate on your current LOC is. If high... pay off your LOC and get the "free" money from Kubota at 0% (Even if markup if 10%, that still only comes out to an effective rate of less than 1% per year after you figure time value of money/inflation).

Thanks for taking the time to reply.
4.3% currently.
I guess my problem is whether to buy new over used, when used has so little hours on it.
Pay 10-15k now for used (250-700hrs) and paid in 2-3 years with LOC or new and paid over 60-84 months
I'm getting hung up on resale values.
Any thoughts on my question about this?

 

[davesl708]

For what it is worth. I bought my BX2200 five years ago with 1180hrs on it. Came with FEL, 60" MMM, 54" tiller and rear 4' blade.
Sold the blade and tiller and picked up a ballast box for $100. That left spending $7k for it. Checking local adds for BX2200's show I could sell mine for more than I have paid for it.

Resale on the used subs is very good. If you are only putting 65 to 75 hrs a year on it used would be the better buy if the tractor was not abused and neglected.

 

[Bexiesbruv]

For what it is worth. I bought my BX2200 five years ago with 1180hrs on it. Came with FEL, 60" MMM, 54" tiller and rear 4' blade.
Sold the blade and tiller and picked up a ballast box for $100. That left spending $7k for it. Checking local adds for BX2200's show I could sell mine for more than I have paid for it.

Resale on the used subs is very good. If you are only putting 65 to 75 hrs a year on it used would be the better buy if the tractor was not abused and neglected.

Thanks.
If its still available, I am going to check out the 2320 this weekend. Asking 13.5 I am comfortable paying 10k if its in as good shape as suggested. He bought in 2011

 

[check]

Thanks. If its still available, I am going to check out the 2320 this weekend. Asking 13.5 I am comfortable paying 10k if its in as good shape as suggested. He bought in 2011

Does anybody have any idea what he would've paid for it back in 2011 when it was new?

 

[Bexiesbruv]

Does anybody have any idea what he would've paid for it back in 2011 when it was new?

I figure 16-18K CAD with the grooming mower and fell as included attachments. US/CAD $ was on par at that time and the original price as given on tractor data was 11k
EDIT: They just got back to me and told me they paid a little over 20k

 

[BrokeFarmerJohn]

I bought used.

I bought a 2005 John Deere with 832h on it for 24k out the door, new there 37-40k. USD not sure the CAD exchange.

I am only putting 40-80 hours per year on it and I hardly work the thing (all FEL work). I bought a bigger tractor than I could normally afford by buying new.

New I was looking at a 33hp 3e series open station tractor new and I bought a cabbed 48hp 4 series premium tractor so that's another aspect, to be able to buy a bigger/ nicer tractor by buying used.

I spent the exact same as I was going to on a new machine. I'm glad I didn't buy a smaller tractor after working this one a bit.

I added up that in this last 7 months alone just pricking with 3-4 head of cattle at a time, I have bought and fed over 11,000lbs of round bales with the tractor, I'm glad I didn't move that in small squares. I did buy about 3000lbs of small square bales in this past year before I bought the tractor.

 

[Bexiesbruv]

I bought used.

I bought a 2005 John Deere with 832h on it for 24k out the door, new there 37-40k. USD not sure the CAD exchange.

I am only putting 40-80 hours per year on it and I hardly work the thing (all FEL work). I bought a bigger tractor than I could normally afford by buying new.

New I was looking at a 33hp 3e series open station tractor new and I bought a cabbed 48hp 4 series premium tractor so that's another aspect, to be able to buy a bigger/ nicer tractor by buying used.

I spent the exact same as I was going to on a new machine. I'm glad I didn't buy a smaller tractor after working this one a bit.

I added up that in this last 7 months alone just pricking with 3-4 head of cattle at a time, I have bought and fed over 11,000lbs of round bales with the tractor, I'm glad I didn't move that in small squares. I did buy about 3000lbs of small square bales in this past year before I bought the tractor.

I figure when I do buy, it will be used. I effected some low cost repair on my zero turn Deines 72inch cut mower and will continue to make do with this for now, but I will keep looking. Our local auction house is putting a few up in farm sales and that might be an option.

 

[BrokeFarmerJohn]

From a financial standpoint it's better to pay cash and get the tractor off the books, 6 months in and the payment is getting annoying, not because it's too much, rather it's annoying to be making payments that could have been avoidable buying a lesser tractor for less money.

That being said I like my tractor too much to sell it lol

I keep telling myself, after I get it paid off I will own it outright and it will last me possibly the rest of my life with how much I use it, but also if I buy more land the tractor will be invaluable.

All in all a tractor is a solid investment, I paid more for my tractor than I have on anything outside of a house but it will hold its value . . . . What I paid for it far longer than a automobile.