Faults:

Loose wheel-bearing - just one of those things.

Headlining peeling - common on these, just an aesthetic issue.

General Comments:

Bought with both problems, wheel bearing nut needed tightening, bit of cleaning, loctite and a punch to lock it in to fix.

Headlining can wait.

Because of the potential for these to bankrupt you if anything goes wrong, I have D.I.Y'd the following.

New water pump, new spark plugs, new oil and filter, cleaned out original air filter, checked a/c and regassed. New audio, head unit, front and rear speakers, sub.

This car is smooth and quiet. Not the quickest off the mark, but whilst on the move the 5sp auto changes beautifully, only just over 2k when at 100km/hr. Everything works. Handles well, steering nice. Full leather seats are nice as is the full electric adjustability. It's all good, can't complain about the handling / performance / NVH. The auto is one of the best I have driven, and I like manuals.

Not so good... trying to update the audio system which is useless. Trying to change anything is a nightmare.i.e speaker sizes are all propriety items, so be inventive. Hopefully someone has done this for you already before you buy or you are very handy with tools etc.

The A/C is hopeless compared to Japanese offerings in general, not very cold and takes awhile to get going (mine is perfect by the way) but relatively hopeless.

Parts are not especially expensive, or maintenance, as the cars are straight forward really.

Buy one, but read the information out there, there is a BMW for everyone out there. I wanted a 328i for the history of that model, and bar the M3, it was THE 3 series to have in my youth. MPG can be better than the 318i, so if you can't afford an M3, don't bother with the baby 318i and if you can stretch it go 328i. My mum has a 320i, and I like mine a whole lot better simply for the extra urge with trivial difference in MPG.

Join a BMW club and get info first!!

Faults:

Two radiator failures.

Indicator and Brake light bulbs infrequantly fail.

Mild leaking Cylinder Head Cover gasket.

Speedometer and gauges will fluctuate widely during accelerator pedal travel.

Speedometer will sometimes jumps 10km/h up, making it difficult to determine actual road-speed.

Lights behind dash inoperative infrequently.

Tweeter speakers on front doors situated where my knee sits causing it paint to rub off.

Rear internal door handles coming loose.

Driver's seat frame broke near inner hinge.

Transmission not down-shifting now when in sports mode.

General Comments:

Most attractive sedan from the 20th century, but this engine is too small for the ability of this car. Perfect sized engine for suburban and city driving with noticeable power increase at 3200 rpm for overtaking. Handles superbly and feels very nice to drive. Great package, and being a mechanic I spot everything and place high demands on it.