NRMA motoring services has a program, Free2go, dedicated to young people. The three-year program offers free advice to young people and free roadside assistance for 17- and 18-year-olds.
NRMA Insurance head of industry research, Robert McDonald, says young people shouldn't rush their purchase and should compare what's on offer after a good look at websites, newspapers and magazines.
"Buy as new a car as you can, avoid buying an older car to save money," he says.
And McDonald urges young people to consider safety as one of the top priorities, claiming new cars are the best way to go.
"There are some small cars, like the Toyota Yaris, with excellent safety equipment for a low price," he says. "Side curtain airbags are dramatically effective in reducing head injuries, and you have ABS and stability control in many small cars, an added advantage."
McDonald says people should also look out for stability control, which prevents the car getting out of control and sliding, particularly when going faster than expected.
But if buyers can't afford a new or nearly new car, McDonald says there are some things to look out for in older models.
"If you are stuck with an older car, medium or larger cars would be a little better, safer than an old small car," he says.
"Make sure safety equipment is up to date, especially seat belts. There are a lot of cars from the late 1980s and early '90s that have airbags, you should be looking for at least driver and passenger airbags."
Plenty of cars from the mid-1990s also feature ABS, McDonald says.
And while image may play an important part in the final decision, a recent survey by the youth insurer branch of AAMI, Just Car Insurance, shows young people are more car savvy when it comes to purchasing than they're often given credit for. The national survey of 1053 young people, aged between 18 and 24, shows the look and appearance of a car is not necessarily a top priority. A total of 93 per cent rate value for money as an important factor when purchasing a car.
Young people are also aware of the importance of safety and security, with 85 per cent of respondents ranking these as significant factors. More than half say environmental friendliness is also a key factor.
Sheree Masters, 17, bought her first car in October last year, five months before she had her provisional licence. She bought a 2000 model Toyota RAV4, a car she's always had her heart set on. Masters purchased her vehicle from a dealership for just over $20,000.
"I saved up half of it, I have been working since I was 14, and I got a loan for the other half," she says.
And while looks and appearance topped her list, she wasn't about to sacrifice safety.
"I wanted something I would be safe getting around in," she says. "I have to admit, the appearance did come first. But safety features like ABS, electric windows and central locking so I feel safe, and airbags were important."
Masters turned to her father for advice when shopping for her first car. "My dad knows a lot about cars so he told me what I should be looking for, but besides that, I pretty much made the decision myself," she says.
"I always wanted to have my own car, that way I could call it my own, it's something I have earned myself. I'm never out of my car, I'm in it every day," she says. "Friends' places, to work, everywhere." Masters is hoping to slightly modify her vehicle with mag wheels and darker window tinting.
McDonald reminds young people to be cautious if purchasing a modified vehicle, as they are often harder to insure.
"Make sure you check with the insurer that the modification is acceptable to them," he says. "Lower suspension, wide wheels or elaborate paint work can dramatically effect the cost of insurance."
He says owners should especially check that engine modifications don't affect its ability to be insured.
How to get a good deal
NRMA motoring expert, Tim Pomroy, says buying your first car requires researching what to look out for, the bargains and the rip-offs. He's given the CARSguide a few key elements to be on the lookout for.
Don't be fooled into buying something if it "looks good". It may have mechanical problems, which will cost you more than the initial price to keep it on the road. Make sure the car has a recent or long registration. This indicates that it has at least had a registration inspection and the fundamentals should be okay. Also, if you're unsure, you probably need to spend a couple of hundred dollars for a vehicle inspection.
While private sales are popular in this category, Pomroy says that as used car prices have recently decreased, you could also potentially get something from a car yard.
"It might be cheap for a reason: high miles, or a car that doesn't have a good reputation for reliability."
There are some good bargains to be had, Pomroy says. "Some Commodores and Falcons from the 1990s are available for a couple of thousand of dollars upwards." But he warns there are issues with bigger cars, especially the running costs, and people should consider if they really need a large car.
"Identify what the use of the car will be. If it's for uni or to leave at the station and mainly suburban, short trips, a small four-cylinder car with an engine capacity of 1.6-litre would be ideal," he says.
"If you're doing a lot of country driving or commuting long distances, a larger car with a slightly bigger capacity engine might be a better choice."
European models also come into play in this category as well as prestige cars.
Pomroy warns European cars can be quite expensive to service and maintain, but he says if you know what you're looking for, there are some bargains to be had in some older prestige cars. Key safety features to be on the lookout for are ABS and airbags.
"In and around the $5000 mark will have driver airbags and perhaps passenger airbags," Pomroy says.
You're nearly in the territory of buying a new small car. There are many small cars at affordable prices, such as the Kia Rio, Hyundai Getz, with nearly half a dozen models offering a good warranty and new features, according to Pomroy.
The disadvantage is that you're buying a car that may be a little more basic than a bigger second-hand model from three or four years ago.
Larger second-hand cars also come into play here, with petrol prices contributing to lower price tags.