Cars and car rentals in Australia

Buy a car as a backpacker

You can buy a used car in Australia from either a car dealer, at an auction or from a private person. If you buy from a car dealer you know that you are guaranteed to be the owner of the car and aren’t buying stolen goods, but the cheapest cars you get from private persons (especially other travellers who have to sell their car before they go home again). Many of these cars have been driven long distances, so be on your guard and don’t buy the first best car you’ll lay your eyes upon. Of course, you don’t want to buy a jalopy that breaks down on the trip, it might be worthwhile to test drive the car to a local workshop and pay $50-$100 to let a mechanic inspect it before you decide.

Here are some websites worth knowing if you’re thinking about buying a car;

  • Cars.com.au (motoring.com.au)has many ads for cars but also great introductory articles with tips on how to buy a car.
  • Carsales (carsales.com.au). The biggest advertising site for car dealers, with many used-cars ads. They also have a section with tips for inexperienced buyers on for example what to look for when you test drive a car.
  • Carsguide (carsguide.com.au). Another gigantic site with advertisements from car dealers and private individuals. Here you can also find tips and testimonials.
  • Countrycars (countrycars.com.au). Used-cars ads for cars outside the big cities.
  • Drive (drive.com.au). More cars. Has a very good section with tips and advice for both buyers and sellers.
  • Gumtree (gumtree.com.au). A big site for mostly used by private individuals, which have among other things, a section of used cars for under $5,000.
  • Redbook (redbook.com.au). Local price statistics and specifications for most car models. Check out the car model you intend to buy to create an idea of what a reasonable second-hand price should be.
  • Travellers Autobarn have both links to advertisements and great tips as well as definitions for backpackers who want to buy vehicles (travellers-autobarn.com.au/blog/the-paperwork-when-buying-a-car-everything-a-backpacker-needs-to-know).

It is good if the car has been professionally controlled before you buy the car. Do not rely on what the seller says, but make sure to form your own opinion of the car and demand original copies of important documents and certificates. If the seller is another traveller who knows that he will leave the country within a week, there is not much to prevent him/her from trying to fool you and lie about the car.

Pappersarbete och dokument värda att känna till inför ett bilköp

  • Paperwork and documents when purchasing a car

    • Blue Slip. An inspection protocol for an unregistered vehicle showing that the car has been inspected (for road safety only), and that it has been identified (vehicle number and car model). A blue slip is also used instead of a pink slip when certain second-hand cars are ordered to undergo an additional inspection or when a car is imported from one state to another.
    • Green Slip, also known as CTP (Compulsory Third-Party Insurance). Basic road insurance that protects you the owner or the driver of your vehicle if your vehicle is involved in an accident. However, this only protects against personal injury and you should consider buying an additional insurance that also protects you against being required to compensate for damage to other vehicles and property. Such insurance is called Third Party Property Insurance.
    • Pink Slip is an inspection certificate. The Same thing as RWC (Road Worthy Certificate).
    • Proof of Registration (REGO). Registration certificate showing that the person trying to sell the car is its correct owner and that the car is registered in a state or a Territory. You must then register the car again yourself; you do not want to make the mistake of forgetting to register the car in your name after the purchase.
    • Personal Property Securities Register (ppsr.gov.au). Before buying a used car, make sure that there are no liabilities associated with the car (that there is no security interest associated with the car). Do a search on the car before you buy it, so that you don’t buy an indebted car. Be sure to save a certificate (search certificate) indicating that you have done a PPSR search so that any creditor may not be able to claim the car later.
    • Road Worthy Certificate (RWC, also known as Road Worthiness Certificate or Pink Slip). An inspection certificate showing that the car is safe to drive around in. In NSW, it is valid for 42 days from the date of issue, and I assume they have a short validity period even in other states. When you buy a car, make sure it has a new RWC.
    • White Slip. An inspection report that “fail” the car as roadworthy. A white slip lists all errors that need to be corrected before the car can be approved by either a pink or blue slip. If a seller shows a car with a white slip, this is a list of things that sellers claim that you as a buyer must fix before you can drive the car on public roads.

    If you buy a car from a private individual, you should ask to see the following paper. A reputable salesperson should be able to give you these documents in its original form and if you get excuses that the paper “does not exist” or is “not needed” then you should get suspicious. In doing so, verify that the information on the registration certificate and the inspection certificate corresponds to the vehicle registration number, engine number and chassis number/vehicle identification number (VIN).

    • Certificate of registration.
    • Inspection certificate (pink slip, or certificate of roadworthiness) that is no more than one month old.
    • Ownership evidence, showing that the seller owns the vehicle (for example, a driver licence and a receipt of purchase with the same name as on the seller’s licence).

    With this information, you then make a PPSR search via the web to ensure that the vehicle is not charged with any liabilities. When you check the PPSR, check that the car is registered correctly. You do this by contacting the Road authorities or equivalent in the state of which the car is registered in and then check the seller’s name against the registration details of the vehicle in their register.

International driver licence in Australia

Overseas driver licence in Australia for tourists and temporary visitors

As a temporary visitor in Australia you can drive on your overseas driving licence but before you travel, you should get an International Driving Permit or a formal translation of your licence if it’s not written in English. Then you can show your International Driving Permit or formal translation together with your overseas licence if the rental company wants to see it when you pick up a rental car, or if you get stopped in a police check and the policeman wants to see (and to understand) your driving licence details. Every state has different regulations, so check what applies to where you are going (australia.gov.au/content/driving-with-an-overseas-licence).

Driver licence when moving to Australia

If you move to Australia, you can apply for a local driver’s licence from your state’s Road authority or equivalent. If your overseas driver licence corresponds to the Australian one and you have your International Driving Permit or have a formal translation, you pay an application fee, and you will soon be the proud owner of a local driver licence. For some overseas driver licences, for example heavy vehicle driver licence, the rules may differ so ask your local Road authority if your particular overseas licence can be translated to the corresponding vehicle licence, or if you have to do some form of driving or test to get an Australian driving licence.

Links to the various states’ Road authorities

If you and the seller proceed with the purchase, you will need to transfer the ownership to you, which means that your name will be on the car’s registration certificate. You can do this via a Road authority (see the link list above) who will charge you a Registration Transfer Fee (around $32 in NSW). In most states, you must go to the local traffic/Road authority’s nearest office to do this. Make sure to get it done within 14 days of purchase, otherwise it will cost more (for example $149 in NSW).

If the car’s registration is about to expire, you must also renew the REGO for the car (also at your local Road authority’s office), but the rules of this differ from state to state. If you are only going to be in Australia for a short time, some states have the option of just buying a 6-month registration of the car. When you buy the car, you also must pay stamp duty for the benefit of buying a car. This varies depending on the state and the car’s value, but in NSW, stamp duty is 3% of the vehicle’s price up to $45,000 and then 5% for every dollar over $45,000.

Finally, you need to make sure that your car is traffic-insured with a Compulsory Third Party (CTP) insurance (also known as a Green Slip). This is the minimum insurance you must have to go on the roads, and it protects you against being fully liable if you cause personal injury in an accident. However, it does not cover property damage (if you become liable to pay for damages on the car you collide with), so consider buying an extra insurance (third party property insurance) that covers this. The period of validity of the insurance must match the vehicle’s registration period. In some states the CTP is included in your REGO, in others you must purchase this insurance from an insurance company.

If you are lucky, the seller already has an ongoing valid insurance and registration that can be written in your name (but the seller probably will want you to pay for the remaining time period when he won’t use this himself).

More information about buying insurance for the car;

  • The State Insurance Regulatory Authority in NSW has a service where you can make price estimates for what a normal Green Slip costs – Green Slip Price Guide (greenslips.nsw.gov.au).
  • Site Greenslips.com.au (greengreenslips.com.au) has a list of insurance companies that sell Green Slips in NSW, as well as some other interesting information about CTP insurance.
  • Most car insurance companies sell third-party insurance (CTP). To help you in the search, it may be worth knowing that the biggest insurance companies are called AAMI, AI Insurance, Allianz, Bingle, Directs, CIC, GIO, NRMA, QBE, Suncorp, Youi, and Zurich. They also sell many other insurances. There are several comparison websites you can use to find the best possible price.

In an accident caused by you, a CTP protects you against being liable on inflicted personal injury, but if you want to avoid paying for the damage on the other car, you need a more complete insurance cover, and this is sometimes referred to as Third Party Property Insurance (not to be confused with Third Party Personal Insurance, which is the same thing as CTP/Green Slip). Talk to your insurance company about what solutions are available and see what suits you best.

If you buy your car through a car dealer, it generally includes a 3 month or 5,000 km warranty that gives you the right to have some hidden faults on the car fixed within the warranty period. When buying a car from a licensed dealer, read the fine print in the contract and what it says about the Statutory Car Warranty in your state. You must also pay Motor Vehicle tax every year, around $250/year for a medium-sized car, a fee dependent on car type and state.

Some companies specialize in doing business with cars for backpackers and often have a so-called buy-back scheme, where they undertake to buy back the car from you towards the end of your trip. They will of course earn money in this (you may only get half the money back when they buy your car back). However, you will be safer off with these cars as they are properly inspected and maintained “between each purchase” and are guaranteed not to be stolen property. One company such as this is Travellers Autobarn (travellers-autobarn.com.au) who both sell, buy and rent cars to backpackers and tourists.

Car and camper car hire

Renting a car gives you more freedom to choose where you want to go and makes it easier to visit more unusual destinations. Most commonly tourists rent a standard 4-door passenger car and drive between hotels and hostels, but there is also a large selection of campers and minibuses that allow you to sleep in the car (and avoid spending money on accommodation). Most car rental companies have very good websites which let you both book and pay online. The all you have to do is to pick up the keys and your car at the agreed pickup location (for example at the airport when you land). Just be sure to bring a formal translation or an International Driving Permit along with your overseas driver license.

In general, you must be 21 years old to get a rental, but different companies have different rules on who they want to rent out to (some require the driver to be at least 25).

Be aware of the terms of the rental agreement you sign. The big companies usually give you unlimited mileage, but sometimes you can pay a surcharge if you travel more than for example 100 km per day. Some companies do not allow you to drive on gravel roads to protect their cars from chipping and damage (it may be worth washing your car before you return it if you have been mischievous and driven on unsealed roads).

Remember to inspect the car when you pick it up it so that you won’t end up having to pay for damage caused by the previous customer (compare the car with the notes written down by the rental company’s own inspector and make sure they haven’t missed anything). Any new damage that the company finds when you return the car, you may be liable for compensation. If you don’t have a travel insurance that covers damage to rental cars or you didn’t purchase an additional excess reduction insurance from the rental company, it can become an expensive story. Also, it might be a good idea to rent a car with automatic gearbox – it’s much easier to drive and you don’t have to think about switching gear when you focus on learning to drive on the left side of the road (unless, of course, you already are a part of the 34 percent of the world’s population accustomed to driving on the left hand side).

Rental car insurance

Something that is not quite as easy to understand is rental car insurance. All rental cars are fully insured (traffic and wagon damage) but the customer must pay an excess if the car is damaged or stolen. This excess can be reduced by when renting the car buying an excess reduction insurance that lowers the excess amount. The excess works like this; You must pay for damages up to a certain amount and anything above is payed for by the rental company. This excess amount is called, for example, Standard/Basic Waiver or Standard/Basic Excess and is around $3,000 for large rental companies.

Since not everyone wants to pay up to $3,000 if something happens to their car, the rental companies often offer you two options to lower the excess (and the companies earn enormous sums on these extra charges). They will try to sell you an excess reduction insurance (lowers the excess to something more manageable, say $300) or total excess elimination (lowers the deductible to $0). Remember that some travel insurances or credit cards already have an insurance that lowers your excess when you rent a car. If you use such a credit card or travel insurance, then you have no reason to buy the same insurance again from your rental company.

Some companies also try to sell theft insurance that lowers or eliminates your excess if the car is stolen. Some also want to sell travel insurance and personal accident insurance, but if you already have a good travel insurance from home you do not need these insurances.

A couple of years ago I rented a Ford Falcon from Hertz in Sydney and when I after a long and tiring day had to park between two cars outside my apartment, I scraped the bumper on the car in front of me. The only damage to the cars was a few scratches in the paint, but when I returned the car, Hertz pulled the full excess from my account ($3,300 dollars if I want to remember) while they investigated the damage. Naturally, I got back most of the money (minus the repair costs that were a few hundred dollars) when they were done a few weeks later, but it was quite annoying to pay that much money out of pocket.

You protect yourself from ending up in the same situation as me by being a better driver than I was, or to buy an excess reduction when you rent the car. My personal solution now is to use a credit card where an excess reduction is included so that I don’t have to pay Hertz an extra cost to lower the excess. Make sure to find out what’s included in the insurances that come with your credit card and your travel insurance.

Car rental terminology.

Here are some different car rental terms that may be worth knowing of:

  • 4×4 (four by four) or 4WD is a four-wheel drive (meaning that all four wheels can receive power from the engine simultaneously), a good off-road car.
  • AWD (All Wheel Drive). Meaning that all four wheels can receive power from the engine simultaneously like a 4WD, either on demand or full-time. Another name for SUV, or a city jeep.
  • Camper Van or Camper is a van or minibus that you can camp in.
  • Caravan is a vehicle equipped for living in.
  • CDW (Collision Damage Waiver). A clause in the rental agreement that gives you an upper limit in liability fees if the car becomes damaged (some damages are not covered though, and you may still be required to reimburse the company fully) during the rental period. The money you must pay is called your excess. For example, your CDW policy has an excess of $1,000. You collide with the car and cause damage worth $5,000. Since the damage is higher than your excess, you only need to pay $1,000.
  • Collision Damage Reduction (CDR). See Excess reduction below.
  • Compact, see Hatch below.
  • Economy Car is a type of 2-door, compact and lightweight car often used in cities.
  • Excess reduction and ERF (Excess Reduction Fee). Variants of a CDW where you pay a fee to lower your excess down to for example $300. Keep in mind that this can be expensive because you may still be liable for certain damages depending on what the contract states. It is possible that you can get better terms through your home insurance or through your credit card than what the rental company is trying to sell you. Excess reduction tends to cost between $20 – $45 extra per day.
  • Hatch or Hatchback is a 2-or 4-door smaller model car with relatively small (and short) boot space since the roof line dips just past the doors.
  • IDL stands for International Driving License.
  • LDW (Loss Damage Waiver). Another name for the CDW.
  • One Way Rental. When a rental car is not returned at the same place as its pick-up.
  • Sedan is a standard 4-door passenger car.
  • Station Wagon or Wagon have two or three rows of seats, with more boot space than a hatchback (since the roof line is extended a bit further to make more boot space).
  • Super CDW or Zero Excess Insurance. Excess elimination. Variants of a CDW where your excess is lowered to $0.
  • SUV stands for Sports Utility Vehicle, a city jeep or a more generously sized family car, like a large station wagon, usually equipped with a four-wheel drive for on- or off-road driving.
  • Theft Protection Insurance (TP) or Super Theft Protection. Excess reduction or excess elimination in case the car is stolen. For modern cars with good locks, the risk of it being stolen is minimal, so consider before you spend money on this extra insurance.
  • Van or People Mover is a minibus.

Traffic and traffic regulations in Australia

This is not a complete list, but the biggest differences that has struck me after being driving in Sweden and in Australia for several years. (In addition to the fact that Australia has left-hand traffic and that the steering wheel sits on the right-hand side of the car.)

  • The speed limits vary, usually 50km/h or 60km/h in the cities and 100km/h or 110km/h on the motorways. Several states have an interesting system of white signs that set the speed limit and yellow signs with recommended speed for a certain distance. For example, on a winding road, a white sign may say that the speed limit is 100km/h but faced with a sharp turn, a yellow sign can warn that an appropriate speed to hold is 40km/h. The signs say that it is still legal to drive in 100km/h, but if you do, you are likely to drive off the road!
  • Drivers unfamiliar with left-hand traffic often forget that the indicators and windscreen wipers in Australian cars sit in the opposite position as cars from countries with right-hand traffic. For example, Swedish novice drivers turn on the windscreen wipers when they try to give a sign they are about to turn.
  • The general left turn laws; Even though it is left-hand traffic, in most cases the one car on the right has the right-of-way. In an intersection without traffic light, if two cars reach the intersection at the same time, the car on the right has the right-of way. Transport, Roads & Maritime Services, NSW (rms.nsw.gov.au) has a full list of give way rules (rms.nsw.gov.au/roads/safety-rules/road-rules/intersections.html).
  • In all Australian states, the legal limit of drink driving is 0.05 BAC (Blood Alcohol Concentration). For most people, this means that you in general can drink one beer and still drive, but as a rule, try not to drink before you drive, especially if you are not accustomed to left-hand traffic since belonging to this group makes the risk of making mistakes in traffic higher.
  • It is illegal to drive if you are under the influence of drugs.
  • Parking signs look weird. A sign that says “2P Ticket” means that you can park for up to 2 hours if presenting a parking ticket in your car window. If a car park is limited to 4 hours parking, the parking sign says 4P (or mins if the time limit is measured in minutes, for example 30 mins).
  • Some parking spaces are specific on how you park your car. “Rear to kerb” means that you must park with the trunk against the pavement. If you park with the front facing the pavement you can get a fine for wrong parking. The same goes for angle parking; Parking spaces that require you to park diagonally to the pavement at a certain angle (usually 45 degrees angle). In Byron Bay there are, for example, parking signs with the somewhat confusing instruction “135 ° Angle Parking Rear to Kerb”.
  • Don’t underestimate how complicated it can be to drive on the left side of the road if you are not accustomed to this. It’s not a clever idea to try to learn how to drive left-hand traffic in Sydney’s or Melbourne’s rush hour when you just got off the plane. Make sure to be fully rested and begin in a quiet traffic situation when you for the first-time experience driving in what might feel like the “wrong” side of the road (and sitting in the wrong side of the car).
  • Be sure to look in the right direction at the intersections, both as a pedestrian and a driver. Many foreign visitors have died in the traffic after being hit by a car because looking in the wrong direction at the crosswalk/intersection.
  • In large cities with a lot of traffic, some drivers drive towards yellow light and red light. Be careful as a pedestrian and look for motorists who hurry through the intersection when the traffic lights turn to red.
  • Many cyclists are fearless in Australia. It is allowed to cycle on the roadside on most motorways, and it is not uncommon to see cyclists next to cars and trucks driving at speeds at 100km/h.

Tolls

Several motorways and bridges have road tolls. If you fail to pay the toll straight away, you can often pay the organisation that administers the route/bridge/highway within 24 hours online. Some roads (e.g. Harbour Bridge, Sydney) use only electronic tolls and if you are going to drive there, you can either get a transponder that you stick on the windshield inside the car or get an e-pass. Acquiring an e-passport means registering your car’s number plate and your credit card up to 48 hours after you drive over the bridge and all tolls are then automatically deducted from your card. Just buy an e-pass for the days you have a rental car, so you do not pay for any customer renting the same car after you.

  • Linkt.com.au (linkt.com.au) is the easiest way to pay road toll or to buy e-pass for Sydney, Brisbane and Melbourne.

Car rental

All major airports and cities have several major rental companies and in the big cities there is a plethora of rental companies to choose from. In smaller cities it may be harder to get a rental car, and you may have to pay extra fees.  Here are some Australian rental companies’ websites:

As with airline tickets, there are several price comparison sites that on the same page let you search for cars from several companies;

  • Car Hire (carhire.com.au). Large booking site that claims to be able to offer some discounts thanks to its size.
  • Drive Now (drivenow.com.au). Has many tips and articles to help drivers and travellers (for example, a distance table that lists how long it takes to drive between the main cities and an article on insurance). You can also find camper vans on this site.
  • Oodles (oodles.com.au). Another search engine with a focus on making the rental process as quick and smooth as possible for those travellers who often hire cars (business travellers and frequent travellers).
  • Vroom Vroom Vroom (vroomvroomvroom.com.au). Search engine that covers over 240 locations in Australia. Particularly interesting are their discount-offers with opportunities for anyone who have flexible travel plans.

Motorhomes rental

Since a campervan gives you somewhere to sleep, they are a popular alternative to renting a regular car, especially the East Coast has many of these motorhomes on the roads. However, they are often more expensive to rent than regular cars and you are often forced to pay an additional fee if you want to stay at a campsite to be able to shower and wash.

There are some big differences between the various motorhome rental companies. Big companies like Britz and Maui rent out modern vehicles with all types of comforts, while cheaper rental companies like Wicked offers old minibuses that almost carelessly has been converted to a motorhome, lacking all the comfort a modern camper would offer. Several companies also offer camping equipment with their vehicles. Compare prices and details properly and make sure you don’t pay a high price for a not-so-good camper.

As with car rentals, there are several websites that compare prices on campervan offers;

Here are some rental companies for caravans and/or minibuses and vans that you can sleep in (campervans):

One-way trips

Where do all the rental cars and motorhomes go when their customers are finished with them? One problem that rental companies face is that many tourists do not return the vehicle at the same location as they picked it up from. When a rental company has a too big vehicle fleet in one location, resulting in too many unrented vehicles, they move some vehicles to another location by offering customers to relocate these to a cheap price. This is called relocation rentals. You pay a small sum to rent the vehicle, but in return you must drive straight to the end-destination, arriving within a certain time frame.

If you are flexible about how you want to travel and enjoy driving a car, you can live quite glamorously on being a driver for rental companies who want to relocate their cars.

Renting private-owned cars and car-pooling with other tourists

Some websites worth mentioning are Drive My Car (drivemycar.com.au) which allows private individuals to rent cars directly from each other. Share Your Ride (shareyourride.net), Jayride (jayride.com/en-au), Coseats (coseats.com) and Carpool World (carpoolworld.com) are websites that try to pair travelers with drivers who have extra space in the car and want to share the gasoline cost with someone.

On the ad-website Gumtree (gumtree.com.au), under Community > Rideshare, there are many advertisements from travellers who want to do car-pooling. Most hostels also have bulletin boards where travellers post notes to find people to car-pool with.