If you’re on a budget, it can be hard to decide which car to go for. Do you opt for a brand new car with a manufacturer’s warranty and that new car smell or is a used car going to give you better value for money?
We’ve done some of the hard work for you and have rounded up five of the cheapest new cars and five affordable second-hand alternatives. Pick a model from one of the cheapest car brands and you should get a larger or better equipped car for your budget.
The cheapest cars are typically city cars and superminis - as these are the smallest ones. These are usually compact cars to get you from A to B, not overly flashy but cars that are good value for money and affordable to run.
You can find bigger used cars for similar money, however, if you’re looking at the cheapest models. These will often have no manufacturer warranty left or higher mileages that bring the price down.
While the cheapest new cars are those in entry-level trims that may have limited features, they often come with added benefits like roadside assistance or servicing packages.
Here we’re looking at new models under £14,000; our top picks are spacious, fun to drive and of course, cheap to buy. So if you’re looking for your next car and can’t decide between new and used, read our guide to the cheapest car brands.
1. Kia Picanto 1.0
Don’t be fooled by this cute little city car’s small dimensions, the Kia Picanto is surprisingly spacious inside, with five doors as standard, room in the back for adults and a 255-litre boot, which is very large for this size of car.
Although there are more powerful options, the entry-level 1.0-litre models are fun to drive around town and do a good job on winding country roads. Working the engine harder out of town will see a dip in fuel economy but for urban driving the Picanto should provide very low fuel costs.
Not only is the Picanto cheap to buy, insure and tax, it also benefits from Kia’s industry leading seven-year, 100,000-mile warranty, so even if you get a five-year-old model, you’re covered if anything goes wrong in the first few years.
2. Dacia Sandero - Essential TCe 100 Bi-Fuel
The Sandero is not only the biggest car in our lineup of the five cheapest new cars, it has also been the UK’s cheapest new car for a number of years - though recent price rises mean that’s no longer the case.
The Sandero is everything you’d hope for in an affordable family car. If you’re looking for a high performance car, look the other way but for the family essentials the Sandero ticks all the key boxes. It’s comfortable and easy to drive, with plenty of standard equipment, including cruise control, air-conditioning and body coloured bumpers as standard.
There are two petrol engine options and one bi-fuel model, which means the car can run on petrol and LPG (liquefied petroleum gas). This could reduce your running costs - as LPG is cheaper than petrol - and is the quickest version in the range but make sure to check that there are local petrol stations with LPG before going for the bi-fuel engine, as you won’t get the most of it otherwise.
3. MG 3 1.5 VTI-tech
The MG 3 is a stylish small car that is enjoyable to drive around corners, with lots of grip and little body roll. Inside it’s practical with a large boot and folding rear seats that increase boot capacity to rival the more expensive Ford Fiesta.
In the front the interior materials can feel cheap in places but this is a cheap car and the entry-level trim comes with an eight-inch touchscreen media system with Bluetooth and Apple CarPlay as standard, making it more appealing if phone connectivity is up there on your list of priorities.
Like the Kia Picanto, the MG 3 comes with a seven-year warranty, however this one only covers the car up to 80,000 miles. This is a tempting reason to opt for a used MG that still has plenty of warranty left, though.
Unlike most rivals, the MG 3 has a relatively large engine at 1.5-litres. This means it’s slightly less economical than the Dacia Sandero above and costs more to tax in the first year. However, it’s also quicker than most similarly priced cars, so it could be an appealing choice if performance is important to you.
4. Hyundai i10 MPi
The latest generation of the i10 has had a sporty makeover to give the city car a more aggressive look with a split grille and sharper lines. As well as a bodywork update, the cabin is roomier, so there’s plenty of leg and headroom to accommodate four adults or three children in the back.
If you’re looking to make the i10 your family car, the entry-level trim comes with plenty of safety equipment as standard, such as Forward Collision Warning System (FCWS) with integrated Autonomous Emergency Braking (AEB) and Lane Departure Warning System with Lane Keep Assist (LKAS).
Hyundai also offers a five-year unlimited mileage warranty, roadside assistance and five annual health checks included in the price.
5. Volkswagen Up 1.0 65hp
The Volkswagen Up is the most expensive new car on our list but it makes the cut because of its high-quality interior and all-round performance as a city car. Whilst most city cars aren’t well suited to motorway cruising, the Up feels refined at high speeds. However, as a city car, it comes into its own around town, with agile handling and good visibility that makes it easy to park.
The entry level trim comes with 15-inch alloy wheels, a five-inch digital display and air-conditioning. The Up should also be relatively inexpensive to repair if things go wrong after the three-year manufacturer warranty period.
6. Seat Ibiza
The Seat Ibiza’s angular styling and sporty looks make it a more exciting version of the Volkswagen Polo - though the cars are very similar under the skin, as Seat and VW are part of the same company.
With a firmer ride and responsive handling, the Ibiza is engaging to drive. Models from 2015 offer more technology inside with a touchscreen media system that includes Apple CarPlay and Android Auto. Low-mileage three and five-door models of this age start at around £7,000.
Seat Ibizas can be a much cheaper option than equivalent Volkswagen Polos second-hand, as they don’t hold their value as well. This means they offer good value for money. Three- and five-door versions of this generation model are available, so for a sportier look you’ll want to go for the three-door version, which still has a decent boot but is tighter in the back for taller passengers.
7. Ford Fiesta
As one of the most popular small cars on the market, there’s no way to overlook the Ford Fiesta. Its huge popularity means there are plenty of good used examples to choose from - and lots of good deals to be found as a result - and it should be cheap to maintain.
The crowning jewel of the Fiesta is how fun it is to drive. Whilst rivals excel in practicality or standard equipment levels, the Fiesta delivers strong performance from its turbocharged 1.0-litre petrol engines and good roadholding around corners.
That’s not to say isn’t a sensible option and if you’re a motorway commuter, all engines offer good fuel economy with the diesel engines capable of more than 80mpg according to official figures, although they’re a little more pricey to purchase than petrol equivalents.
8. Peugeot 208
The 208’s entry-level ‘Active’ trim is well equipped with air-conditioning, cruise control, folding rear seats and alloy wheels. If you can stretch your budget to a 2016 model, you also get a seven-inch touchscreen media system with Apple CarPlay and Android Auto. Used models start at around £7,500
Diesel models are the most frugal, with official economy figures of more than 90mpg listed. Though achieving this is unlikely on typical roads with traffic, hills and other obstacles, the 208 is still a very economical car with even the petrol models proving impressively frugal.
9. Skoda Fabia
If you’re looking to make a bold statement with an otherwise sensible car, the Skoda Fabia is the car for you. There was a range of bright colour combinations to choose from when the Fabia was new so there’s lots of funky looking used examples available.
The Fabia’s tall roofline means that rear passengers get lots of headroom, and having five doors makes it easy to access the rear seats to get children in and out of the car. Boot size is good, too, with more room than the Ford Fiesta and even the previous generation Ford Focus, which is a larger car.
Standard equipment is impressive, as well, with electric heated mirrors, electric front windows, a digital radio and Bluetooth. Plus, there’s an extensive safety kit including ISOFIX points, tyre-pressure monitoring and LED daytime running lights. As well as its funky looks, the Fabia has heaps of practical features, including quirky touches like a built-in ice scraper next to the fuel cap.
10. Volkswagen Polo
A used Volkswagen Polo is a great way to get a good quality interior and plenty of equipment without breaking the bank. Prices for a 10-year-old model start at around £6,000; less than half the price of a new Volkswagen Up.
The models at this price point are cheaper due to slightly higher-than-average mileage and smaller engines, but can still be desirable options. If you’re looking to spend a bit more, there’s a range of more powerful but still economical engines to choose from.
Polos hold their value well as used cars, so when it comes time to sell, the resale value should still be strong - meaning you’ll get more of your money back. Opting for a used model is a good way to upgrade from a smaller city car to enjoy more space and greater practicality.