Leasing vs Buying

[ricotansky]

Having seen lots of tempting lease deals recently, I have been considering it for when it comes to replace my current car (as an alternative to buying a one to two year old used car). However, as I do more than 10k a year, the deals do not look so good.

In particular - if your mileage is 15k pa like me, are you better off buying (nearly new)?

The good lease deals seem to be for a mileage of 10k or less, so I'm thinking that leasing is not cost effective compared to buying a car when you do more miles? Or is it more comparable to buying a new car?

[Sheepshanks]

ricotansky said:

Or is it more comparable to buying a new car?

Not sure if I'm missing something here, but unless you're going to lease a used car, then yes, it's more comparable to buying a new car.

[CCM604e]

Find out what the mileage overage is, sometimes it's not too expensive and factor it in.

[BL Fanboy]

Work out the cost of 15Kpa mileage on your favoured lease car, then see if you can buy and run the same car over the same period and miles cheaper yourself.

Don't forget to factor in a personal hassle of selling a car when you're done with it instead of just handing back a leased one.

If you bought a car yourself, you'd really start to save money if you kept it a year or more longer than you would've with the lease alternative.

Another factor might be that leasing companies might get access to a "bulk buy/bulk supply" of cars that you as a private punter might not be able to access on your own.

You could get a bargain lease if you pick a deal that is on special offer rather than be totally fussy on the exact car/spec you want.

I'd pick a car I fancied and then try to calculate it both ways over a number of years.

[Jonno02]

I always take my PCP cars on about 6k. I cover about 10k miles a year though. After my lease is up, I just trade the car in (for far more than I'd lose/have to pay off) as deposit on my next one.

[MrAverage]

if you do high milage then your best to 'buy' a car on pcp (x months with payment at the end), these have milage factored in but only if you hand it back. so you'd probably be best to buy a car on pcp put milage as low as possible and get monthly payment as cheap as possible then dispose of car however you see fit / whenever you want.

we currently have a juke on pcp but due to our lowish milage were going to lease a car from june (as we'd save around £100 a month)

[wibblebrain]

I think it is possible to contract hire a car for less than it would cost to buy one at two years old and run it for an equivalent period.

However to do that you would need to take advantage of the bargain offers that are occasionally available, rather than having a free choice of what car you would normally choose.

It's probably also somewhat dependent upon what car you'd usually buy. The picture will be different if you are usually driving something like a Citroen C1 or a Range Rover Sport.

Some of the 15k deals on the Tiguan, Skoda Octavia, Skoda Yeti are looking attractive at the moment.

[ricotansky]

Thanks for all the responses, time to make a spreadsheet I think! My brain hurts now.