Buying a car could be the second costly expense you make in your life, after a house. This makes it very important that you must consider all the financial implications before you drive away a car in New South Wales. New South Wales is one of Australia's south-eastern states and is the home to the country's largest and oldest city, the state capital of Sydney. When you buy a car in New South Wales, you should pay tax on the purchase price of the car, which is not usually added by the seller until you have purchased the car. Running a car in New South Wales is really an expensive affair. 

Buying a car in New South Wales is almost similar to most other states in Australia. You can buy a new car from a dealer, or a used one from dealer, private parties or through auction. Shopping around can save a considerable amount of money. You can also engage the services of organisations like Australian RAC, who will inspect the vehicle you are interested in.

Is it expensive to run a car in New South Wales?

The cost of running a car in New South Wales often depends on the type of car you purchase, the insurance policy you buy, and other cost involved in maintaining your car. 

When buying a car in New South Wales, you should factor a number of initial cost into your budgeted purchase price. These costs include the cost of registration, dealer delivery charges, charges on mechanical or other inspections, government taxes and levies such as transfer fees and stamp duty, compulsory third party insurance, and other insurance coverage as required by you. 

The most obvious cost involved in running a car in New South Wales is the fuel cost. In addition to the fuel costs, other running costs include

a. Insurance coverage:

If you drive a car in New South Wales, then you are legally required to buy compulsory third party insurance, which is also called CTP Greenslip. Buying a CTP protects the owner or driver of the car from personal injury claims made against them in case of any accident. It is the minimum requirement of car insurance, but does not protect you against any injuries to you or third party, or damages to any property. The premium for compulsory third party insurance can be paid either 6 months or 12 months cover.

The CTP Greenslip – basic car insurance in New South Wales must be bought before the car can be registered. The "Green slip" is actually the receipt for the payment made. The CTP insurance in Australia is regulated by the MAA [Motor Accidents Authority]. Unlike the drivers in most other states in Australia, the New South Wales car owners can buy their CTP insurance policy separately from their vehicle registration. 

There are a number of insurance providers that sell CTP insurance for car owners. With so many players in the market, you will be surprised to see that the premium costs are not the same everywhere. The premium costs always depend on how risky you are to insure with a particular insurance company. 

The CTP insurance is the basic insurance coverage for your car that is required by law . However, if you require third party, fire and theft insurance or comprehensive insurance in addition to CTP insurance, then this may add up your total running cost. Most drivers in New South Wales hold some kind of additional insurance along with CTP that gives them added protection and peace of mind. The type of additional insurance covers often depends on individual needs and preferences. Insurers also offer 'tailored approach' by letting you choose the level of cover you need. The cost of additional insurance coverage will depend on the various risk factors as well as the governmental charges. 

b. Registration costs:

In New South Wales, you need to register your car with the RTA (Road Transport Authority), which unfortunately can cause an annual financial drain from your pocket. It is not a one-time payment when purchasing the vehicle. In addition, you will be required to provide certification regarding the mechanical performance of your car which includes a trip to an inspection station and involves additional costs. 

The three steps involved in getting your car registered in New South Wales include

i. Renewal of the Green slip: Before registering your vehicle with the RTA, you are required to renew the Green slip by purchasing Compulsory Third Party insurance policy from a motor insurance provider. 

ii. Vehicles that are over 5 years require an e-safety check. So, based on the age of your car, decide whether you require an e-safety check, if so, organize to get one. Your car registration renewal notice also will tell you whether you need an e-safety check or not. 

iii. Upon having the above two items, you can go and register your car with the RTA.

The cost of registration depends on the weight of your car, so the more your car weighs, you will pay more. The car registration fee and the stamp duty for registration can be calculated using appropriate calculators found in the website. 

The cost involved in registering your car in New South Wales for the first time will depend on your vehicle's market value, the gross vehicle mass (GVM), type of the vehicle, and the use of the car (private or business use). However, the cost of renewal will depend on the gross vehicle mass, type of vehicle and its use only. 

c. Other costs:

In addition to fuel costs, other costs involved in running a car in New South Wales include loan repayments, club membership, maintenance, spare parts and repair charges and regular service charges.

Conclusion:

Once you have decided to buy a car in New South Wales, put down on paper all the potential costs involved in its running. If you are in doubt, over-estimate and increase the figures but do not under-estimate. Never forget to include the fuel costs, in addition to other running costs like insurance, registration renewal, service and maintenance charges, club membership, and loan repayment costs. 

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Kevin Button is a car enthusiast from New South Wales, Australia.