Best new cars for under £20,000

The number of great cars for less than £20,000 proves you don't need to break the bank to get a decent motor

James Mills
Mar 6, 2019

Thinking of spending around £20,000 on a new car? You’re in good company. Britain’s consumers typically spend an average of £22,000 on a new set of wheels, which means the car makers focus plenty of attention on this part of the market.

There are great cars and some tempting deals for anyone spending £20,000, be it as a cash buyer, taking out a high street loan or arranging a finance plan through a car maker or dealer.

Leading the way is Britain’s best-selling car, the Ford Fiesta. The latest-generation model continues to impress, and at £20,000 drivers could slide behind the wheel of the ST version, one of the best junior hot hatchbacks ever to burn through a tankful of petrol.

Alternatively, if you prefer something more spacious and comfortable, there is no shortage of SUVs. Fierce competition in this part of the car market is driving up the standards, which is good news for car buyers. Seat, the sister company to Volkswagen, deserves a mention here; its Arona is a superbly capable car.

Whatever the type of car you need, make sure you shop around, watch out for special offers, compare deals or finance plans, and see what different dealers representing the same brand can do to better an offer; you’ll be surprised how keen they are to win your custom.

Best new cars for under £20,000

1. Volkswagen Golf

Our pick Volkswagen Golf SE 1.5 TSI Evo 5-door
List price £21,615 (around £19,068 after discount)

You’d have to be pretty uncharitable to find fault with the Volkswagen Golf. It’s one of those cars that exceeds at pretty much everything it does, from the way it drives to the level of comfort onboard; fuel economy to running costs.

When fitted with the 1.5-litre petrol engine, in 130hp spec, it drives with excellent manners, pulling eagerly, proving hushed at motorway speeds and returning up to 57mpg, which makes it a viable alternative for anyone wanting to ditch diesel.
Admittedly, this isn’t one of the more affordable family hatchbacks available. But compare what you get with an Audi A3 or BMW 1 Series, and you’ll find it’s good value for money.
Volkswagen Golf buying guide

2. Ford Fiesta ST

Our pick Ford Fiesta ST 2 
List price £20,695 (around £19,623 after discount)

The Fiesta ST is all about having fun. Few cars, regardless of their price, will have their driver hooting with laughter along a nice stretch of road quite like this hyperactive hatchback.

It has a 1.5-litre, 200hp, three-cylinder engine that is brimming with character. It sounds interesting, packs enough of a punch to spirit the ST past slower traffic safely and is backed up by a chassis that knows how to have a good time.

Perhaps the only downside we can think of is that there’s a small fuel tank, so your Sunday morning drive will be rudely interrupted by a trip to the petrol station.
Ford Fiesta ST buying guide

3. Skoda Octavia

Our pick Skoda Octavia SE 1.5 TSI hatchback
List price £20,715 (around £18,254 after discount)

When it comes to space, the leader of the race is Skoda’s Octavia. For a budget of around £20,000 or less, few hatchbacks or saloons can compete with this one for stretch-out-in-comfort appeal.

The boot is vast, at 590-litres, and the presentation of the dashboard is clear and uncluttered, while the latest entertainment touchscreen enhances the day-to-day user experience.

Our pick of the engine range would be the 1.5-litre, 150hp petrol unit, unless you’re intending to drive more than 12,000 miles a year – in which case haggle hard over the price of a diesel. Sure, some critics might argue that it could be more satisfying to drive – compared with, say, a Ford Focus, it doesn’t feel as responsive – but we’d argue that Skoda knows the sort of driver that will buy this type of car, and comfort and refinement are preferable to steering precision and ultimate roadholding.
Skoda Octavia buying guide

4. Mazda 3

Our pick Mazda 3 GT Sport
List price £24,595

When browsing the range of hatchbacks for families, it’s tempting to make up a shortlist of the usual suspects, such as the VW Golf (above), Ford Focus or even the more expensive Audi A3 or BMW 1 Series. However, the latest Mazda 3, a car that probably rarely registers on the radar of drivers, is well worth considering.

The new-generation model looks good, boasts a classy interior and the driving experience is one of the most refined in its class. Mazda wanted to make the new 3 both relaxing and rewarding to drive, and in both respect its engineers have succeeded.

The 2-litre Skyactiv-G petrol engine isn’t the most spirited, as it isn’t turbocharged, but aside from this the 3 is an impressive alternative to the norm.
Mazda 3 buying guide

5. Kia Sportage

Our pick Kia Sportage 1.6 GDi 2
List price £20,305 (around £18,236 after discount)

We suspect we’re not alone in thinking, “Doesn’t that Kia look good?”. The Sportage could almost pass for a Porsche; switch the badges and you could probably get away with telling someone it’s the new Macan.

Happily, though, it doesn’t cost anything like a Porsche. The Sportage range starts at just over £20,000, and with haggling or using a site like BuyaCar, you can expect to make some savings on that.

There’s a 1.6-litre petrol that performs reasonably well and will manage just over 40mpg, but for the entry-level diesel you’ll have to spend more than £21,500 to benefit from its potential for 57mpg.
Kia Sportage buying guide

6. Seat Arona

Our pick Seat Arona SE Technology 1.0 TSI 115 DSG
List price £19,470 (around £18,444 after discount)

For a first-time effort, the Arona left us seriously impressed. Okay, Seat is owned by the Volkswagen Group, so it’s not as if there isn’t a bit of experience that can lend a hand behind the scenes, but even so Seat has shot to the top of the class with this compact SUV.

Families will appreciate the space aboard, drivers will appreciate the excellent entertainment system and seamless connectivity with smartphone features, and everyone will be in agreement that the Arona is quiet, comfortable and composed.
Our favourite engine in the range is the petrol 1-litre with 115hp, especially as it comes with the DSG automatic gearbox that makes light work of everyday driving.
Seat Arona buying guide

7. Mini Cooper

Our pick Mini Cooper Sport 3-door List price £20,230

Not everyone needs a practical car. Indeed, some drivers are more than willing to sacrifice everyday concerns in favour of owning a car that feels special. And in that respect, the Mini Cooper hits the bullseye.

Forget that it only seats four people, that the back seats are as cramped as those in an old theatre stall, and that the boot is better suited to shopping at a boutique outlet rather than cramming in half the contents of an Ikea superstore. What it delivers above all else is a sense of fun.

The turbocharged three-cylinder engine makes the Mini feel nippy, the roadholding is the next best thing to a go-kart and the driving position and dashboard all reinforce the sense that the Cooper is unlike anything else on four wheels.
Mini Cooper buying guide

8. Renault Zoe

Our pick Renault Zoe Dynamique Nav R110 Z.E 40
List price £18,420 (around £13,794 after discount)

It’s tempting to suggest that the Nissan Leaf is the electric car of choice for those on a budget, but in fact it’s too expensive. Even after the plug-in car grant is applied, it costs from more than £26,000. Which leaves the Renault Zoe, the pint-size car for the volt age, which can be bought for less than £19,000.

At that price, drivers will also need to lease the car’s battery, from £59 a month. That gets you a 41kWh battery for up to 180 miles of driving between charges, and it will take approximately seven hours to recharge the battery from flat to full using a 7kW wallcharger – less than two hours if using a more powerful, 43kW rapid charger.

Unlike many more expensive electric cars, this one is very affordable to run, because it falls in value by less over time. It’s also very likeable to drive and live with. Give it a try; you might be in for a pleasant surprise.
Renault Zoe buying guide

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