Top 5 Budget-Friendly Cars Under $25K in Australia 2025

Introduction: Budget Cars Are Better Than Ever in 2025

In 2025, buying a new car in Australia doesn't mean breaking the bank. With more advanced tech, enhanced fuel efficiency, and improved safety features, budget-friendly cars under $25,000 offer serious bang for your buck. Whether you're a first-time buyer, a student, or simply looking for an affordable second vehicle, there are excellent new models on the market that blend quality, reliability, and style.

This guide rounds up the top 5 budget-friendly new cars under $25K in Australia for 2025, comparing features, specs, pricing, and why each is worth considering.

Why Consider Budget Cars in 2025?

Before diving into the list, here’s why cheap cars today are smarter buys than ever before:

• Improved Safety: Most sub-$25K cars now come with AEB, lane-keep assist, and rear cameras as standard.
• Modern Infotainment: Touchscreens, Apple CarPlay, and Android Auto are often included.
• Low Running Costs: Better fuel economy, cheaper parts, and affordable insurance.
• Ideal for Urban Driving: Compact size, easy maneuverability, and efficient engines.

Let’s explore the top 5 picks in detail.

1. 2025 Kia Picanto GT-Line – Compact Yet Feature-Rich

Price: From $21,290 (drive-away)
Body Style: Hatchback
Fuel Efficiency: 5.0L/100km
Engine: 1.0L turbo petrol, 3-cylinder
Transmission: Automatic
Seats: 5
Safety Rating: ANCAP 4-star (2023 test carried forward)

Why It’s a Top Pick

The Kia Picanto remains one of Australia's best-selling micro cars — and for good reason. The 2025 GT-Line variant brings youthful styling, surprisingly good performance from its turbocharged engine, and a raft of features usually found in larger cars.

Key Features

• 8-inch touchscreen with smartphone mirroring
• Reversing camera and parking sensors
• Smart key with push-button start
• LED daytime running lights
• 7-year unlimited km warranty

Pros

• Fun to drive in city traffic
• Long warranty coverage
• Small footprint makes it great for urban parking

Cons

• Cramped rear seat space
• Limited boot (255L)

2. 2025 MG3 Hatch – The Best Seller with Fresh Updates

Price: From $19,990 (drive-away)
Body Style: Hatchback
Fuel Efficiency: 6.7L/100km
Engine: 1.5L petrol
Transmission: 4-speed auto
Seats: 5
Safety Rating: ANCAP unrated (older models 3-star)

Why It’s a Top Pick

Despite its outdated engine and lack of a modern safety suite, the MG3 continues to be Australia’s top-selling light hatch due to its affordability, space, and user-friendly design. The 2025 model gets minor interior tweaks to enhance cabin comfort.

Key Features

• 8-inch touchscreen with Apple CarPlay
• 6-speaker audio system
• Reverse camera
• 307L boot — one of the biggest in the class
• 7-year unlimited km warranty

Pros

• Outstanding value
• Spacious for a compact hatch
• Good aftermarket support in Australia

Cons

• Lacks AEB and modern safety features
• Outdated engine and transmission combo

3. 2025 Suzuki Swift GL Plus – The Smart All-Rounder

Price: From $24,490 (drive-away)
Body Style: Hatchback
Fuel Efficiency: 4.8L/100km
Engine: 1.2L petrol
Transmission: CVT auto
Seats: 5
Safety Rating: 5-star ANCAP

Why It’s a Top Pick

The Swift has always been a reliable performer for Aussies who want fun and frugality. The 2025 GL Plus builds on Suzuki’s legacy by packing in better safety tech while keeping the cost low.

Key Features

• Autonomous emergency braking
• Adaptive cruise control
• 7-inch touchscreen with smartphone connectivity
• Digital driver display
• 5-year unlimited km warranty

Pros

• Zippy engine and lightweight build
• Excellent fuel efficiency
• Balanced ride quality

Cons

• Small rear doors
• Cabin plastics feel basic

4. 2025 Hyundai i20 – Sharp Looks, Solid Tech

Price: From $24,990 (drive-away)
Body Style: Hatchback
Fuel Efficiency: 5.3L/100km
Engine: 1.4L petrol
Transmission: 6-speed automatic
Seats: 5
Safety Rating: 5-star ANCAP

Why It’s a Top Pick

The Hyundai i20 is proof you don’t need to spend big for sophistication. With a sharp exterior, user-friendly cabin, and active safety systems, it offers serious competition to Japanese rivals.

Key Features

• 8-inch touchscreen with Apple CarPlay/Android Auto
• Forward collision avoidance
• Lane-keeping assist
• Rear occupant alert
• 5-year unlimited km warranty

Pros

• Sharp and modern design
• Good safety gear for the price
• Comfortable for longer drives

Cons

• Slightly noisy cabin at highway speeds
• Limited rear seat legroom

5. 2025 Mitsubishi Mirage ES – The Affordable City Hero

Price: From $18,490 (drive-away)
Body Style: Hatchback
Fuel Efficiency: 4.7L/100km
Engine: 1.2L petrol
Transmission: CVT
Seats: 5
Safety Rating: ANCAP 4-star (2020)

Why It’s a Top Pick

While nearing the end of its model life, the Mirage still ticks a lot of boxes for budget-focused buyers needing a reliable, cheap-to-run city car.

Key Features

• Reverse camera
• 7-inch infotainment system
• Bluetooth and USB
• Very light steering and tight turning circle
• 10-year capped-price servicing (conditional)

Pros

• Cheapest new car in Australia
• Easy to drive and park
• Excellent fuel economy

Cons

• Feels dated inside
• Lacks advanced safety tech

Honourable Mentions

2025 GWM Ora Standard Range (Electric Hatch)

Although just outside the $25K limit (starting around $26,500 with incentives), the GWM Ora is worth watching if you're considering an EV. It offers solid range (~320km) and quirky styling with modern features.

Used Car Options Under $25K

If you're open to used vehicles, you can score nearly-new versions of:

• Mazda2
• Honda Jazz
• Toyota Yaris
• Hyundai i30
• Skoda Fabia

What to Look for When Buying a Budget Car

Choosing a car under $25K doesn't mean compromising on essentials. Keep these priorities in mind:

1. Safety First

Look for at least 4-star ANCAP ratings and features like:

• AEB (Autonomous Emergency Braking)
• Lane-keeping assist
• Reverse camera
• ISOFIX child seat anchors

2. Fuel Efficiency

Aim for models with under 6.0L/100km if fuel costs are a concern.

3. Infotainment & Connectivity

Modern tech should include:

• Touchscreen display
• Apple CarPlay/Android Auto
• Bluetooth hands-free

4. Warranty & Ownership Costs

Longer warranties reduce long-term stress. Choose brands offering 5+ years of warranty and capped-price servicing.

5. Resale Value

Stick with brands known for strong resale in Australia — think Toyota, Hyundai, Suzuki, and Kia.

Conclusion: Great Cars, Small Budget

You no longer need to stretch your finances to own a reliable, tech-equipped, fuel-efficient vehicle in Australia. The top 5 cars under $25,000 in 2025 bring tremendous value, and with the options above, there’s something for every kind of buyer — whether you’re after zippy urban handling, roomy practicality, or simple efficiency.

Key Tip: Always test drive before you buy, compare servicing costs, and explore drive-away deals, especially at end-of-financial-year sales.