Here’s the car I just bought to list on RelayRides: a 2001 BMW Z3 2.5i roadster with 72,589 miles - hooked up to jumper cables (more on that, in a minute).
I spent most of Saturday surfing online for different types of cars - ranging from trucks to SUVs to hatchbacks to convertibles. Using Truecar.com, Craigslist, and eBay Motors I focused my search on the following characteristics:
- Fun to drive
- Attractive to renters in the Palo Alto area, including Stanford students
- Highly depreciated in market value, yet still reliable
- For sale nearby
At the top of my list was the Mazda Miata, followed closely by the VW Rabbit/Golf. As I started looking through Bay Area listings for these cars, I was surprised by how (relatively) slowly they depreciate. Trying to find one in great condition, with less than 100,000 miles and a price of less than $5,000 was difficult - so I decided to raise the cap on my budget to $10,000.
$10,000 opened up the possibilities quite a bit. After a lot of research, I came across the original generation of the BMW Z3. The original models were underpowered with anemic inline-4 engines, but mid-cycle BMW added their classic inline-6 motors to the mix. I came across several 2001 models with the 2.5-liter engine that appeared to be in excellent condition. And in contrast to similarly-priced Miatas, the 2001 Z3 delivers 184hp and a 0-60 time of roughly 7 seconds flat.
Why $10,000? Assuming a used car loan rate of 4.35%, no down payment, and a term of 4 years, the purchase works out to 48 monthly payments of $227 each. I haven’t added in insurance or maintenance yet, but I’m assuming that will roughly double the monthly cost. Given that the top cars on RelayRides can regularly make $600 - $800 per month for their owners, this would equate to a free car!
Also, I had a final consideration - any car that I bought wouldn’t take a lot of time to find and purchase. I wasn’t looking to find a mis-priced car, but just a fairly-priced car.
So I narrowed the search down to three Z3’s in the area, and negotiated the price I was looking for with the first seller I visited ($10,250 paid, versus $11,999 asking). Everything went fine until this morning, when the car wouldn’t start. I hope it’s just a dying battery - it started fine with the jumper cables you see in the picture.
I’m getting the battery replaced tomorrow, and the listing will be going live on RelayRides.com soon. I’m planning to experiment with many different methods of social media to see what works best. More to come.