Buying a car in Australia: Complete guide for expats and residents

Can a foreigner buy a car in Australia, and if so, how? This guide covers all you need to know. Plus we’ll touch on how Wise can help expats and residents manage their finances when making significant purchases like cars in Australia, offering competitive exchange rates, low transfer fees, and transparent pricing that can help you save money compared to banks

Key takeaways

• You can buy and register a car in Australia if you’re over 18, holding a government issued photo ID document 
• When you register your car you must provide a set of documents to prove legal ownership and pay fees which vary by state
• Once driving you need to carry your driving license and registration certificate in the vehicle – you may need an international driving permit if your license is not in English
• It’s mandatory to have at least third party personal injury insurance known as the Green Slip, which you can arrange through a broker. Carrying proof isn’t necessary as your insurance records can be accessed on a national database
• To make a major purchase like a car in Australia, you may find you get a better deal if you pay with Wise. Wise lets you convert currencies with the mid-market rate and low fees, perfect if you’re buying as an expat  

How to buy a car in Australia: Step-by-step process

Let’s jump right into the detail – here’s how to buy a car in Australia in a few simple steps:

1. Set a Budget and Secure Funding:

The price of buying a car in Australia can vary enormously depending on the vehicle type, age and condition. To make the purchase process easier, it helps to start with a realistic budget. You can choose to pay for your new car in Australia in cash, by taking out a loan in Australia or in your home country, using a hire purchase scheme or by getting dealer financing for example.

Each option has its own advantages and disadvantages – if you’re sending money from another country to Australia to pay for your new vehicle, check out Wise as a low cost secure route to transfer funds online and through the Wise app.

2. Research and Select a Vehicle:

Now you know what you have to spend, you can research which car suits your needs. There are plenty of sites online to inspire you – consider whether you want to buy new or used, and then invest some time searching and filtering the options on dealership websites or umbrella resale sites in your local area.

3. Due Diligence and Inspections (Crucial for Used Cars):

When you buy a new car from a dealership you have a point of contact if you’re unsure about the vehicle history or condition – but buying second hand through a private sale means taking the time to check the car out yourself.

Important steps include checking the Personal Property Securities Register to identify the vehicle and its history, and making sure that the seller’s address is the same as the one listed on the vehicle’s registration document.

When you view the vehicle be sure to get a good feel for the condition it’s in, and consider having a mechanic check it over to spot any issues you may not immediately see.

4. Gather the Documentation:

When you purchase the vehicle the seller will need to pass you some key documents, and you’ll need to register the car in your own name. The exact process may vary a little state to state. In New South Wales as an example, the seller must lodge a Notice of Disposal (NOD), and then the buyer has 14 days to transfer the vehicle’s registration (rego) into their name.

5. Secure Payment:

The next step will be to pay for your new car. How you can pay depends on the seller – at a dealership you may be able to pay by bank transfer, cash or card. Private sellers may prefer a bank transfer or cash.

If you’re paying by bank transfer from a currency other than AUD, Wise can be a good choice with support for fast, secure payments that use the mid-market rate and low, transparent fees.

6. Transfer Ownership and Register the Car:

Once the sale is complete, you’ll need to register the car in your name. This process requires you to have a few documents, but is usually fairly straightforward to follow. Different states may operate this step slightly differently, so you’ll need to check the details for the state you live in. You generally have 14 days from taking possession of the car to register it.

7. Arrange Insurance Coverage: Before you drive your vehicle make sure you have at least the mandatory minimum third party personal injury insurance known as the Green Slip. Most drivers choose to buy a more comprehensive policy for peace of mind – although this does push up the costs.

Insider tip: Why Max chose Wise to transfer money internationally

Wise payments can be sent to 140+ countries with low, transparent fees and the mid-market rate without any mark-up. There are high limits, fee discounts for transfers over 20k GBP, and help from a dedicated support team for large transfers. Here’s what one happy customer had to say: ‘I have used Wise for several years and made more than 10 transfers with them, and some of high amount. It is a high concern transferring money using a platform you don’t know, but I never had any issue and the money always arrived as expected.’ *In this review the customer name was changed for privacy. The customer wasn’t paid to share their review.

Who can buy a car in Australia?

You can buy a car in Australia as long as you have a valid proof of identity. To register your vehicle you’ll also need to be over 18 years old. There’s no restriction on non-residents buying a vehicle in Australia provided they can meet all the local requirements including holding adequate insurance and transferring the ownership of the vehicle to their own name.

What are the documents required to buy a car in Australia?

When you buy a vehicle the seller is likely to check your ID and proof of address. Upon exchange of ownership, the seller will pass you the vehicle’s documents so you can register it in your name. There are then further documents needed to register the vehicle with the authorities.

States manage the registration process, so you’ll need to double check the exact details required based on where you live. Generally to register your new vehicle you will need:

• Your ID and proof of address
• Purchase date of the vehicle
• Vehicle purchase price or market value – whichever is higher
• Payment for the transfer fee and stamp duty

Many people can register their new vehicle online, but in some circumstances you must visit a physical location to register your car in person.

Is it allowed to use a foreign national driver’s license in Australia?

Yes. You can use your foreign license to drive in Australia for as long as it is valid, or until you become an Australian permanent resident or citizen. The only exception to this are:

• In the Northern Territory drivers must convert to an Australian license after 3 months
• In New South Wales and Victoria drivers must convert to an Australian license after 6 months

You can only drive the classes of vehicle covered by your foreign license, and you must carry your license at all times. If your license is not in English you also need an approved translation or an international driving permit. You can learn more on the Australian government website covering visiting drivers.

Understanding the true cost: Total cost of ownership

The total cost of car ownership in Australia goes beyond the initial purchase costs. Here are some other things to think about:

• Registration Fees: You pay this at the point of taking ownership and registering your new car. Costs vary by state and vehicle type. For example, motor vehicle duty in New South Wales is calculated based on the value of your vehicle, and charged at 3 AUD per 100 AUD of value for cars purchased for up to 44,499 AUD, or 1,350 AUD plus 5 AUD per 100 AUD in value for more expensive vehicles.
• GST and/or Luxury Car Tax: Depending on the vehicle you buy, its value and where it comes from you might need to pay GST, with Luxury Car Taxalso applied on some imported vehicles.
• Technical Inspection: While it may not be mandatory to have a mechanic look over the car you buy, it’s a good idea to have an expert inspect your vehicle before you hand over any money.
• Mandatory insurance: You must have at least Compulsory Third Party personal injury insurance known as the Green Slip. Costs vary a lot depending on level of cover, driving history and vehicle type.
• On going costs: Finally, budget for ongoing costs like fuel costs, servicing, repairs, and parking. Fuel costs at the time of research sit around 1.65 AUD per liter.

Transferring money to buy a car in Australia: Fees comparison

Sending money overseas can be a headache with poor exchange rates, hidden fees, and slow transfers. As some providers and banks charge hidden fees, it is important to take a look at the total amount received, instead of only the transfer fees. Other costs can be added to the exchange rate which can be a surprise – and may mean your recipient gets less than you expect.

Here’s an illustration. Let’s imagine you’re paying for your Australian car from the US and need to send USD to Australia to be converted into AUD and deposited to the dealership. Here’s what the transfer would cost you for Wise vs Chase, when buying a popular model of Toyota:

	Wise	Chase
Toyota RAV4 GX (new) price in AUD	47,465 AUD	47,465 AUD
Transfer fees	87.70 USD	0 USD
Exchange rate	1.54166	1.52246
Total sent in USD	30,880 USD	31,200 USD

As you can see here, the car ends up costing more in USD if you pay using Chase – even though Chase has no transfer fee for foreign currency wire payments. That’s because Chase uses an exchange rate markup – a fee added to the conversion rate. This is hard to spot but can make a big difference on a high value payment like this.

Wise can help you save money on international transfers by offering mid-market exchange rates, low fees, and fast, secure payments. Plus if you prefer you can get a Wise Multi-currency Account to hold and manage money in multiple currencies when you live an international lifestyle.

New car vs used car

One important decision you’ll need to make is whether you want to buy a new car or a used car. Both have their own advantages and drawbacks.

A new car is likely to be far more expensive than buying second hand – which also pushes up other costs such as stamp duty. Your vehicle will depreciate in value rapidly – but you’ll usually find that new cars are reliable, offer the most up to date features and may come with a warranty for peace of mind if anything should go wrong.

A used car will normally be far cheaper than buying a new vehicle from a dealer. However, the drawbacks include the fact you don’t know the car’s full history, which may mean there are issues with its condition you didn’t expect. On the upside, the value of a used car decreases less quickly than a new vehicle, and insurance costs may be cheaper.

What are the pros and cons of a new car and a used car?

Pros of new car	Cons of new car
✅Choose the exact vehicle you want, with customisation options available ✅Unlikely to have mechanical issues, and likely to be covered by warranty ✅Up to date features available including performance and safety features ✅Newer card can be more fuel efficient than older models, lowering running costs	❌Initial costs are vey high, including increased tax and duty ❌Value depreciates rapidly – around 30% in a single year in some cases ❌You may not be able to afford the perfect model for your needs

Pros of used car	Cons of used car
✅Lower costs to buy and insure compared to a new vehicle ✅You might be able to buy a higher end model with your fixed budget ✅The value depreciates more slowly than when buying new ✅Stamp duty and other value based costs are lower due to the lower purchase value	❌May have unforeseen mechanical issues which can be costly ❌No choice to customise features ❌Warranties are not often offered, meaning you’re responsible for repair costs immediately

When is the best time to buy a new and used car in Australia

There’s no perfect time to buy a car in Australia, but there are some patterns which can help you track down a great deal.

For example, the National Roads and Motorists Association suggests dealerships are more likely to offer good deals at the end of the month or the end of the financial year as they race to hit sales targets. They also suggest December as a good time to buy as dealers look to sell the stock they hold of that year’s models, to restock in the following January.

Ultimately, buying a car in Australia is likely to mean doing some negotiation, so shopping around and biding your time until you can snag a great deal may pay dividends.

Where to Buy Cars in Australia

Let’s look at some of the different places where people can buy a car in Australia so you can decide which is right for you.

New Car Dealerships

Australia has plenty of chain new car dealerships, such as Eagers Automotive, Autosports Group and Peter Warren Automotive Group. You can find the local dealerships for the car type you prefer, with a Google search.

When choosing a new car dealership, check for official accreditation and pick a well established dealership which has a good reputation for customer service. Using a dealer may mean you can access good trade-in and warranty options although prices are pretty standard, and so finding a bargain may be harder to manage.

Used Car Dealerships

If you’re buying second hand you can go along to a physical used car dealership close to your home, to look at the vehicles in stock.

You’re likely to come across a broad range of dealership sizes and services – if you’re looking for a warranty or a finance package as well as the vehicle, it’s worth shopping around to find a dealer which can offer everything you need under one roof.

Online Car Purchasing

Online sales platforms like Autotrader offer comprehensive search functions to help you find vehicles you’re interested in from private sellers and dealers.

Looking for your next Australian car online makes it far easier to compare your options and short list different vehicles. However, the chances are that you’ll need to complete due diligence checks yourself and the platform won’t be able to help if there are issues.

Make sure you understand the legal protections offered by the site you choose before you buy.

Other Private Sellers

Aside from online umbrella sites you may also find private sellers advertising locally, in newspapers and stores, or through word of mouth. If you’re lucky you may find a great bargain, but in this case you’re highly unlikely to have much legal protection and no warranty if the vehicle fails or has issues you were unaware of.

If you’re meeting private sellers, be sure to take precautions for safety, such as telling someone where you are, checking the seller ID, and running a check on the vehicle history in case it can not be legally sold by that individual.

Electric cars and hybrids

About 10% of the vehicles sold in Australia are electric or hybrid. This is relatively low as a proportion on a global scale, but it’s expected to increase rapidly – partly in response to government actions like the New Vehicle Efficiency Standard which demands car makers meet strict emissions targets.

Where drivers have stated they would not buy electric, this is usually due to concerns about the range and ability to tow – both issues which may be resolved in future as the technology and available infrastructure develops.

Car prices in Australia

As you’d expect, car prices in Australia vary a lot, with different pricing ranges for different vehicle categories and brands. The good news is that there are several different ways to get a pretty good feel for the costs of your vehicle, particularly if you’re planning on buying new.

One way to get an idea of the costs of new cars is to look on a price aggregation site like Numbeo, which takes user information about costs of living on a country and city level. This data is dynamic and changes frequently to reflect a live picture of the average cost of anything from a beer in a bar, through to a car.

Here’s an idea of the costs of buying a new car in Australia taken from this data:

Car type	AUD average cost	USD average cost
Volkswagen Golf 1.4 90 KW Trendline (Or Equivalent New Car)	44,423 AUD	28,826 USD
Toyota Corolla Sedan 1.6l 97kW Comfort (Or Equivalent New Car)	35,106 AUD	22,780 USD

Another option is to pick the type of car you like, and look on a dedicated dealership site. To give an idea, here are the advertised prices for various models of Toyota – one of the most popular car brands in Australia:

Car type	AUD list cost	USD list cost
Toyota Yaris	32,766 AUD	21,263 USD
Toyota RAV4	47,465 AUD	30,802 USD
Toyota Corolla	36,199 AUD	23,491 USD
Toyota Fortuner	60,362 AUD	39,172 USD

Importing a car to Australia

It’s perfectly possible to import a car to Australia – but whether importing is worthwhile vs buying locally will depend on the vehicle you choose and where it comes from. Even if the initial outlay for your vehicle is lower elsewhere, you’ll need to weigh up the costs and hassle against any price upside you may get by buying your vehicle in another country.

If you do decide to import your next vehicle to Australia, using specialist importers can help the process run a lot more smoothly vs self-importing. You’ll have an expert on hand to help you navigate all the processes needed, and to make sure you cover all your legal duties properly.

Import process and requirements

The process of importing a vehicle to Australia involves several different costs, which can include:

• Import permission fees
• Customs duty
• Goods & Services Tax (GST)
• Luxury Car Tax
• Stamp duty and vehicle registration fees

There’s also often a long delay when importing a car, due to the required permissions, checks and legal processes. Just getting permission to import in the first place may take 60 days, for example.

To help you decide if it’s worth it in your case, here are the basic steps to importing a vehicle into Australia:

1. Research whether your vehicle can be imported legally, or if modifications are required – to remove asbestos and comply with Australia road safety laws for example
2. Apply for permission to import your vehicle by creating an account in ROVER – this may take up to 60 days to be processed
3. Get permission from Department of Infrastructure, Transport, Regional Development, Communications and the Arts to import your car – there may be conditions or requirements involved
4. Steam clean the vehicle interior to pass quarantine requirements and arrange shipping
5. Get customs clearance by paying all your required taxes – using an agent makes this process far easier
6. Arrange inspection by the Department of Agriculture, Fisheries and Forestry to check the car can clear quarantine
7. Register your vehicle according to the local requirements in your state

If you need to pay your taxes or fees in AUD from another country, you could cut the costs of currency conversion by using Wise. Get a Wise account and add money in the currency you prefer. You can then order a Wise card to make your payment digitally, with currency conversion that uses the mid-market rate and no foreign transaction fee.

Required car equipment and documentation

You’re required to keep your driving license and the car’s proof of registration with you when you drive in Australia. It’s also legally required to hold adequate insurance – although proof isn’t needed as the insurance is linked to your car registration and can be checked easily by authorities.

Aside from this, there are many recommended items to keep in your car, such as a first aid kit, spare tyre and high visibility jacket.

You must ensure that all passengers use seatbelts, and children use appropriate child restraints based on their size, weight and age when driving.

Tips for buying a car in Australia

• Buying a car in Australia means checking the vehicle is being legally sold and is roadworthy – if you’re not confident in navigating the process, buying from a dealer can give peace of mind
• Be wary of offers that are too good to be true. Like elsewhere in the world, Australian criminals may try to scam car buyers in various ways
• Get your car insured before you drive – brokers can be a good way to navigate an unfamiliar market and get an excellent deal
• If you’re buying from a foreign currency use Wise to send your payment, with the mid-market rate and low, transparent fees

Conclusion

Buying a car in Australia isn’t too hard to do, but it may not work in the same way that you’re used to at home. It’s important to understand the legal requirements to buy and register a vehicle and what you must do to drive it legally in Australia. Plus, as it’s not cheap to run a vehicle, be sure to budget for ongoing costs like insurance, fuel and maintenance.

Save money when you buy a vehicle from abroad, with Wise. Wise can be an indispensable financial partner, for those navigating international transfers and seeking transparent, cost-effective ways to manage car purchase funds. Get the mid-market rate, secure payments and a fast and streamlined service.

Frequently asked questions (FAQ)

How do I transfer money from my home country to pay for a car in Australia?

Check out Wise as a cost effective option for sending money to Australia for your new car. Wise payments can be sent to Australia from 140+ countries with low, transparent fees and the mid-market rate without any mark-up. There are high limits, and fee discounts for large amount transfers. Plus you’ll get help from a dedicated support team for high value transfers if you need it.

How can I avoid losing money on currency exchange when buying a car?

Being ripped off on currency exchange is a major concern for expats purchasing big-ticket items. Choosing a provider which uses the mid-market exchange rate with no hidden fees can help. Wise has a transparent fee structure, competitive rates, and offers the mid-market exchange rate so you suspend less on fees.

Can a temporary resident buy a car in Australia?

You can usually buy a car in Australia as a temporary resident. Bear in mind that some states may require you to get a local driving license as little as 3 months after arriving.

Can I buy a car in Australia on a working holiday visa?

Yes. If you have enough money, and you’re over 18 with a valid government issued photo ID you should be able to buy a car in Australia on a working holiday visa.

Do I need credit to buy a car in Australia?

You can buy a car in Australia with cash, or if you have a local credit history you may qualify for a loan or financing agreement.

Useful sources for buying car in Australia

• Wise – Low cost international transfers and currency exchange which uses the mid-market rate
• Moneysmart – Australian government site, covering things to think about when buying a car
• Commbank – car buying checklist from major Australian bank Commbank
• Westpac – car finance options explained by major Australian bank Westpac
• Australian government – stamp duty explained, with ways to check duty payable in your state
• Moneysmart – things to think about when buying car insurance – government website
• Australian Competition and Consumer Commission – consumer protections when buying a vehicle
• Personal Property Securities Register – search tool to identify the vehicle and its history
• Australian Government Department of Infrastructure, Transport, Regional Development, Communications and the Arts – Importing a road vehicle into Australia