These days, buying a car doesn’t necessarily mean going to a dealership. While the traditional approach of visiting a new or used car dealer in person is still an option, you can also buy from a private seller, at an auto auction house or even online – in fact, you don’t even have to leave home to buy your next car.
But with so many options available, where is the best place to buy a car in Canada? In this guide, we’ll break down your car sales choices one by one to help you decide the right option for you.
If you’re wondering where to buy a car – whether new or used – the table below outlines your options.
| Online dealer | In-person from a new car dealer | In-person from a used car dealer | Private seller | Auction | |
|---|---|---|---|---|---|
| Cost | Often cheaper | Often more expensive | Often more expensive | Often cheaper | Cheap |
| Speed of purchase | Depends how much you shop around | Can be time-consuming | Can be time-consuming | Can be time-consuming | Very fast |
| New cars available | Depends on the dealer |  |  | | |
| Used cars available | | | | | |
| Test drives | Trial period usually | | | | |
| Ease of purchase | Easy | Varies — depends on the seller | Varies — depends on the seller | Varies — depends on the seller | Easy |
Online car dealerships such as Clutch allow you to compare and buy cars completely online. Simply browse the dealer’s vehicle inventory on their website, compare models you’re interested in and then place your order.
The car you buy can then be delivered to your door. In many cases, you’ll then have a trial period of around 7–14 days to drive the vehicle and make sure you’re happy with your purchase. Some online dealers also allow you to trade in your current vehicle to put toward the cost of your next car.
The biggest advantage of buying a car online is that it’s extremely convenient. You can compare a wide range of vehicles and prices without having to get off the couch and without feeling pressured to buy. However, making such a major purchase without physically laying eyes on the car yourself is a barrier for some potential buyers.
Check out our guide to online car dealers in Canada to research your online car buying options.
If you want a shiny new set of wheels and that new-car smell, your local car dealership is likely going to be your first stop to buy a car. You can find dealerships for all major brands in cities and towns across Canada – it’s just a matter of visiting your top choices to start test-driving models.
When you find the vehicle you want, you can then negotiate the purchase price. You can also trade in your current vehicle to help cover the cost of buying a new car, but you’ll probably need to settle for a lower price than you could get if you were to sell privately.
Another option worth considering is buying a demo car from a dealership. Demo models are usually vehicles that have been used as test-drive cars, but they can also be vehicles used by dealership employees or even used as loan cars.
Because demo cars can sometimes have thousands of kilometres on them and a little wear and tear, you can enjoy substantial savings compared to the cost of a new vehicle. And since they’re often used to show off the best a particular model has to offer, they commonly include a range of top-of-the-line features and extras. However, you’ll need to find out exactly how the demo has been used before you buy.
A used car may not have the same level of glamour and excitement as a new vehicle, but buying used is a lot more affordable than buying new. You can visit multiple dealerships to compare different models and find the best price. You also have the freedom to negotiate a better price.
The downsides are that there’s always the risk of buying a car that’s less than perfect under the hood, while used car salespeople don’t exactly have a reputation for trustworthiness.
Your next option when searching for the best place to buy a car is to buy a vehicle from a private seller. Traditionally, that meant searching for cars advertised in the classifieds section of your local paper or maybe just marked on the side of the road with a for-sale sign on the windshield.
These days, there are plenty of online marketplaces where owners can sell their cars. Some are dedicated car sales websites like AutoTrader and Carpages.c, while others are general marketplaces like Kijiji and Facebook Marketplace.
These sites make it easy to filter cars based on your desired make, model, price and a host of other features. Once you’ve found a car you like, you can contact the seller to arrange a time to inspect it and take a test drive.
Buying a car at an auction is the quickest method for buying a car and can come with significant savings compared to buying from a dealer. Although many auctions aren’t generally targeted toward private buyers, you can find a great deal if you know what you’re looking for.
You’ll typically get to inspect a vehicle before bidding, but test drives aren’t available. Some cars come with a limited warranty and others won’t – the auctioneer will announce this before bidding begins.
With this in mind, it’s important you research ahead of time and keep a cool head when bidding starts.
The cheapest place to buy a car in Canada is in the Atlantic region, according to the AutoTrader December 2022 Price Index. The 2022 data reveals that the average price of a new car in the region is $53,900, with used cars selling for an average of $44,935.
The next cheapest province to buy a car is Quebec, with average new and used prices of $55,660 and $45,975 respectively.
But it’s bad news for Albertans searching for affordable cars as their province topped the list as the most expensive place to buy a new vehicle. If you’re car shopping in Alberta, expect to pay $63,231 for a new car and $54,859 for a used vehicle.
Car sales tax can have a big impact on the total cost of buying a car in Canada. However, the amount of tax you pay varies depending on where you live and whether you buy from a dealership or a private seller.
When you buy a new or used car from a dealership in Canada, you’ll need to pay GST at a rate of 5% no matter where you live. However, the provincial tax rate that applies on top of GST varies from province to province.
| Province | Provincial tax rate | Federal GST rate | Total tax rate |
|---|---|---|---|
| Alberta | 0% | 5% | 5% |
| British Columbia | 7–20% (7% on vehicles less than $55,000) | 5% | 12–25% |
| Manitoba | 7% | 5% | 12% |
| New Brunswick | 10% | 5% | 15% |
| Newfoundland and Labrador | 10% | 5% | 15% |
| Nova Scotia | 10% | 5% | 15% |
| Ontario | 8% | 5% | 13% |
| Prince Edward Island | 10% | 5% | 15% |
| Quebec | 9.975% | 5% | 14.975% |
| Saskatchewan | 6% | 5% | 11% |
| Province | Provincial tax rate | Federal GST rate | Total tax rate |
|---|---|---|---|
| Alberta | 0% | 0% | 0% |
| British Columbia | 12–20% (12% on vehicles less than $55,000) | 0% | 12–20% |
| Manitoba | 7% | 0% | 7% |
| New Brunswick | 15% | 0% | 15% |
| Newfoundland and Labrador | 15% | 0% | 15% |
| Nova Scotia | 15% | 0% | 15% |
| Ontario | 13% | 0% | 13% |
| Prince Edward Island | 15% | 0% | 15% |
| Quebec | 9.975% | 0% | 9.975% |
| Saskatchewan | 6% (vehicles less than $5,000 are exempt) | 0% | 6% |
If you have less-than-perfect credit or no credit at all, you still have options for where to buy a car. While you might have trouble financing a car through conventional loans from banks and credit unions, some lenders specialize in offering bad credit car loans.
Car dealerships and online car loan lenders are some of the best places to buy a car with bad credit. They often offer car loans to consumers who are dealing with bankruptcy, bad credit or no credit at all. You may encounter higher interest rates and fees for any loans you are approved for, though.
Generally, borrowers with bad credit can qualify for rates that are as low as 10% up to 29.99% or more. The rate you can secure will vary depending on a handful of key factors, including the following:
Do your research and compare loan options to find the best deal.
Finding the best place to buy a car in Canada can save you time and money when you’re ready to choose your next ride. Putting in the effort now will help you find a reliable car with all the right features, without breaking the bank. Remember to also compare financing options for cars to get the most out of your money.
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