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

Ben Custard
Mar 14, 2022

Thinking of spending around £20,000 on a new car? You’re in good company. British drivers 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 deal through the carmaker 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 a used ST version, one of the best small 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 and crossovers. Fierce competition in this part of the car market is driving up the standards, which is good news for car buyers. Seat, which is part of the Volkswagen Group, deserves a mention here; its Arona is a superbly capable car. It’s crept above the £20k mark now, though, which makes pre-registered examples look even better value.

Whatever the type of car you need, make sure you shop around, watch out for special offers, compare deals or finance plans, and you’ll be surprised what you might find. If you're after the most car for your money, you may want to consider a nearly new car, with enormous discounts on the list price even for recent models with less than 1,000 miles on the clock.

Best new cars for under £20,000

1. Volkswagen Polo

Cheapest model Volkswagen Polo 1.0 85 Life
List price £18,285
Used deals from £10,500
Monthly finance from £233*

You’d have to be pretty uncharitable to find fault with the Volkswagen Polo. It’s one of those cars that exceeds expectations 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 1.0-litre turbocharged ‘TSI’ petrol engine, it drives with excellent manners, pulling eagerly, proving hushed at motorway speeds and returning over 50mpg, which makes it a viable alternative for anyone wanting a more refined or cheaper alternative to diesel models.

Admittedly, this isn’t one of the more affordable family hatchbacks available. But compare what you get with an Audi A1 or a five-door Mini Hatchback, and you’ll find it’s good value for money.


2. Ford Fiesta

Cheapest model Ford Fiesta 1.1 Ti-VCT Trend
List price £17,470
Used deals from £8,931
Monthly finance from £216*

For a fun drive on a budget, the Ford Fiesta should be pretty near the top of your shortlist. You don’t have to stick to the fast Fiesta ST, either, because even the base-spec model will have you grinning when you want to drive enthusiastically.

A £20,000 budget limits you to the cheapest Trend model now, while the sporty-looking ST-Line just comes in over budget if you need five doors. Trend gets more tech than you might expect in a small car: digital radio, Apple CarPlay and Android Auto, automatic headlights and a handy heated windscreen.

It’s a shame you can’t buy a new ST for less than £20k these days, but there are plenty of used examples on BuyaCar within budget with fewer than 10,000 miles on the clock. In fact, £20,000 allows you to pick your perfect Fiesta specification, engine and perhaps even colour if you’re happy to buy a second-hand model.


3. Skoda Scala

Cheapest model Skoda Scala 1.0 TSI 95 S
List price £17,870
Used deals from £14,300
Monthly finance from £0*

When it comes to space on a budget, you’ll not do much better than the Skoda Scala. For 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 467 litres, and the presentation of the dashboard is clear and uncluttered, while the latest media system enhances the day-to-day user experience.

Our pick of the engine range would be the 1.0-litre petrol unit, with either 95 or 110hp. Both are economical enough to make a diesel engine redundant. 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 comfort and refinement are strong, making this an appealing choice for most drivers.

Our favourite SE grade includes parking sensors, cruise control, bright LED headlights and a touchscreen with the latest smartphone connectivity.


4. Citroen C3 Aircross

Cheapest model Citroen C3 Aircross 1.2 PureTech 110 C-Series
List price £17,845
Used deals from £10,050
Monthly finance from £197*

When browsing the range of small SUVs for families, it’s tempting to make up a shortlist of the usual suspects, such as the Nissan Juke, Renault Captur or even the more expensive Volkswagen T-Roc. However, the eye-catching Citroen C3 Aircross is well worth considering.

Citroen’s replacement for the blobby-looking C3 Picasso people-carrier looks good, boasts a stylish interior and favours comfort over sportiness. In a world where every car is expected to be capable of racetrack driving, it’s refreshing to see a car that’ll soothe you instead.

For now, it still comes with a diesel engine, but most buyers will be better off with one of the 1.2-litre PureTech petrol engines. Three are available, with the 110hp version providing decent acceleration and fuel economy of almost 50mpg - and falling within our budget.


5. Kia Stonic

Cheapest model Kia Stonic 1.0 T-GDi 100 2
List price £18,900
Used deals from £12,350
Monthly finance from £213*

The Kia Stonic is another small SUV that you might not have considered before, but it’s worth a look if you want a well-equipped, smart-looking car that’s warrantied to the hilt. You get seven years’ worth of cover, which is one of the best warranties on offer, so even a used example will be covered for ages. It’s very possible that you’d never need to use it, though, as the Stonic is one of the most reliable small cars on sale, according to the Driver Power survey run by our sister site Auto Express.

Only a 1.0-litre petrol engine is offered, with two slightly different power outputs. Neither are lightning-fast and the difference is minimal, so we’d stick with the cheaper 100hp engine - especially as it comes in under budget if you’re happy with the ‘2’ trim. With air-conditioning, Apple CarPlay, parking sensors and cruise control, you’re not missing out on anything essential.

However, take a look at some lightly used examples - some with mileage in the hundreds - and you can choose a much higher spec for far less than £20,000. A slick automatic gearbox is also available higher up the range.


6. Seat Ibiza

Cheapest model Seat Ibiza 1.0 MPI 80 SE
List price £17,165
Used deals from £8,790
Monthly finance from £0*

The latest Seat Ibiza 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 close to the top of the class with this stylish supermini.

Families will appreciate the space aboard, drivers will appreciate the excellent media system and seamless connectivity with smartphone features, and everyone will agree that the Ibiza is quiet, comfortable and composed.

Our favourite engine in the range is the budget-friendly petrol 1.0-litre with 95hp, although looking at our stock of second-hand cars will open up the possibility of the DSG automatic gearbox that makes light work of everyday driving.


7. Mini Hatchback

Cheapest model Mini One Classic
List price £17,405
Used deals from £7,380
Monthly finance from £280*

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.


8. Renault Clio

Renault Clio front view

Cheapest model Renault Clio 1.0 TCe 90 Iconic Edition
List price £18,590
Used deals from £12,473
Monthly finance from £219*

It’s tempting to suggest that an electric car like the Renault Zoe is great for those on a budget, but in fact, it’s too expensive. Even after the plug-in car grant is applied, it costs more than £26,000. Previously, the Zoe came in at under £20,000, but you had to pay an extra monthly cost to lease the battery; there’s no battery lease option these days.

That’s where the Zoe’s petrol-powered sister comes in, as the Clio is comfortably within our budget. True, running costs are higher, but the Clio is efficient for a petrol car, or there’s an impressively frugal hybrid model that’s just a little bit more expensive. Iconic trim provides great value and a long equipment list, or there’s a racily styled RS Line version if you want to stand out.


*Representative PCP finance - Ford Fiesta:

48 monthly payments of £192
Deposit: £0
Mileage limit: 8,000 per year
Optional final payment to buy car: £2,923
Total amount payable to buy car: £11,926
Total cost of credit: £2,426
Amount borrowed: £9,500
APR: 9.9%

BuyaCar is a credit broker, not a lender. Our rates start from 6.9% APR. The rate you are offered will depend on your individual circumstances.


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