Condition is everything at this sort of price level... for reference I just bought an X-plate Primera for £1500 (1.8 petrol though so not quite as economical as you'd like, although it does manage 40 on the motorway if you take it easy). Barring a couple of very minor niggles (needed a service as not done since November '05, and I needed to glue one of the electric window controls down as it had been messed with a bit and one of the tags had come loose), but apart from that it runs like clockwork, had full service history up to that Nov05 service and is pretty much spotless.
My advice would be to go for a bigger car if you can afford the insurance, for three reasons:
1) They tend to be bought by slightly older drivers who look after them better than some young kid on a budget;
2) They're better built in the first place and don't need to be ragged to get up to speed so will be more likely to have lots of life left in them;
3) Depreciation is heavier so you'll probably get a better and newer car for the same money.
Unless you're doing a fair number of miles (>12000 at least), definitely consider a petrol. Diesels carry a premium, and the newer Common Rail type diesel engines can be a problem if the previous owner has put petrol in them -- read big bills, and you can't always tell with a test drive etc.
As I say though make is less important than condition. Cars which depreciate heavily (Nissan, Citroen, bigger Ford/Vauxhall, Fiat, and anything Korean in particular -- the newer Accents can be cracking used purchases) are worth looking at because they're worth less to start with, so condition at the same price is often higher than your Peugeots, VWs, Hondas etc which are at a premium price.
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Micra maybe? mines been fault free for 3 years save rear exhaust box and 2 feet of brake pipe, 45mpg mixed run and £81 a year to insure.
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Agree entirely. I was focussing on the economy requirement, but it has to be said that the OP could have a much more relaxing journey in something a bit bigger. My 'new' Xedos (see Bangernomics thread) does over 30mpg and cost well under a grand. For that, I waft along in smooth leather-lined comfort, with plenty of crumple zone around me and a nice V6 growl if I want to press on...
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Must admit I have a lot of respect for the Xedos, very nice car.
All the Japanese efforts at producing a big BMW/Merc rival seem to fall flat in the UK (although they're big sellers in the US). However they're superbly engineered one and all; Honda Legend, Mazda Xedos, Nissan QX, Lexus GS, Mitsubishi Sigma/Galant, all very capable and utterly bulletproof. Real bargains to be had.
I have to say that from what I have seen of a couple of the big Hyundais, they're heading the same way. The new Sonata might not be a driver's car (too far biased for comfort), but it and the old XG30 are again very well engineered and can be picked up cheaply (the old Sonata is a bit too cheap inside for my liking, although mechanically it's as good as the Japanese pretty much).
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Thank you Jase - so far, I'm still getting my head around the fact that such things can be so undervalued.
"All the Japanese efforts at producing a big BMW/Merc rival seem to fall flat in the UK "
Indeed, but perhaps it says more about us than them. Toyota seem to have had a bit more luck with Lexuses (Lexi?) which suggests that we're far too badge-conscious. I'm sure the Xedos would have done better if Mazda had taken their own badge off, so naturally I'm rather glad they didn't!
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I'd recommend a Peugeot 306 1.9TD, there are loads around within your budget- £1000 should get you one on a P plate, with electric windows, PAS etc and sensible mileage. They are group 5 insurance, give 45mpg when driven sensibly and are fairly nippy and fun to drive. Pick one with service history, change the oil and filters every 5-6k and the coolant every 2 years to rule out head gasket problems and it should be good for 200k plus. Parts are relatively cheap and basic maintenance i.e. oil and filter changes are a piece of cake.
Martin
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