How much compact car can I buy for R16 000 a month?

By Stuart Johnston

In America “compact cars” are actually officially defined by measurements as supplied by the US Environmental Protection Agency, and they are listed as cars of  4,1 metres or less. These days the term has been broadened there to take in compact MPVs.

In Europe the term applies to larger hatchbacks, such as Golfs, but we generally refer to these cars here as “larger hatchbacks”.

Here in South Africa, a “compact” can be anything from a small MPV to a small SUV to a Crossover, to even an extended hatchback model. We have included a range of shapes and configurations in our check list that reasonably fits the broader “compact” description.

How much compact car does R16 000 buy me in terms of purchase price?

The purchase price upper-end limit for  a R16 000 monthly repayment  is R795 000. AutoTrader’s standard repayment template for this sort of purchasing advice article settles on  a 10 percent deposit on the list price, a repayment period of 60 months, and an interest rate on the financed amount of 12 percent.

Customers who have been in the game for a long time  with excellent credit records (and larger salaries) will often be able to negotiate an interest rate  closer to the current prime interest rate of 10 percent,  but as a workable average, a rate of 12 percent interest on the financed amount is par for the course.

A 10 percent deposit on R795 000 works out at  just under R80 000.

We use WesBank’s online repayment calculator to work out the ceiling purchase price for these so-called compacts, with a R16 000 monthly repayment as out starting point. Using our standard repayment parameters  the  maximum  list price is R795 000. The 10 percent deposit works out at just under R80 000.

We focused on a few cars that fit the compact description Between R550 000 and R795 000

At this price level, the best definition of a compact in South Africa is filled by the various Crossover and smaller high-style SUVs that put  appearance and high-specification ahead of practical concerns. This is in contrast to cheaper compacts, which we identified as more practical, and falling somewhere outside the traditional hatchback configuration.

We have included here cars costing well under the R795 000 cut-off, because it never hurts to have some spare cash in your monthly budget. These include the Mercedes-Benz B-Class top model at R551 885 . The Volvo V40 T5 Cross Country  AWD Momentum, a sort of large hatchback  with raised ground clearance that is very well-specced, comes  in at R571 100.

At the other end of the spectrum, we have the BMW X4, where  only the two entry level models of this stylised “fastback” SUV make our cut-of, starting at R781 987 for the 20i petrol model (the diesel model also just makes the cut). We include the BMW X4 because it is, in essence, a compact version of the massive BMW X6.  The same applies to the smaller VW and Audi models listed. And we included the new Opel and Isuzu models for interest sake, as they are not yet top-of-mind.

Of course, one of the attractions of a so-called compact vehicle is that it is always going to be more economical than a larger one. At this price level, fuel consumption may not be too great a consideration, but it always feels good when the money you hand over at the fuel station is less than you originally expected!

Here’s our quick check list and prices for our premium-level  “compacts”

Mercedes-Benz B250	R551 885
Toyota RAV4  2.2 D-4D AWD VX	R563 200
Opel Grandland X 1.6 Turbo Cosmo	R565 000
Volvo V40 T5 Cross Country  AWD Momentum	R571 100
Volkswagen Tiguan Allspace 2.0 TSI 4Motion Highline	R604 800
Lexus NX 300 E	R606 000
Audi Q3 2.0 TDI Quattro	R607 500
Isuzu MU-X 30 4WD	R629 100
Honda CR-V 1.5 T Exclusive AWD	R633 000
Mercedes-Benz GLA 250 4Matic	R684 643
BMW X4 xDrive 20d	R784 339