Leasing vs buying older

[peld]

I know many people lease here (including me) but has anyone gone back to buying slightly older higher spec cars and run them for 2-3 years instead of leasing/pcp'ing newer cars?

My current lease car (new Skoda Superb estate) goes back later this year, and was looking at the usual range of family cars (on current deals a Tiguan or another Superb is probably fave). We have a second car (a Ford CMax) which we use to take the kids to nursery, and the wife's run about through the week. It only did 3k miles last year.

Inspired by a recent Top Gear re-run on Dave (a few years where they bought an SLK(?) and a 8 Series for £7k, the same as a Nissan Pixo) , I was thinking instead of doing another lease, buying a slightly older car and just getting two years out of it. Leasing has been great and hassle free, but there doesn't seem to be a lot of great deals at the moment (compared to when i got my deal).

A replacement Superb is £6k for the 2 years (and was looking at up to £8k for the next one). However looking on Autotrader £8k would buy something like an 2009 Audi A4 Avant, a 2009 5 Series Estate, a 2011 Volvo V60 or 2011 Passat Estate (all under 70k miles).

Even if I allowed £1k for tax and service in those two years (tax is probably £70), if I got anything above £2-3k for selling on in two years it's profit (or running it for longer than 2 years). We'd probably use our Ford more too to ease the running pressure on this car.

Anybody done anything like this? Obviously downsides compared to a lease are the nervousness at MoT time, the unknown that something might break, the unknown cost, the [minor] lack of certain creature comforts (compared to a brand new car) etc

[MitchT]

You'd be unlucky to have a relatively new used car fail an MOT. My OH bought her 1 Series at three years old. It's 12 years old now and has never failed an MOT. Buy something "approved used" with a decent warranty and renew the warranty each year to avoid any other technical fears. That just leaves routine servicing, fuel, tyres, VED and insurance.

[akirk]

Have a look at this topic:
http://www.pistonheads.com/gassing/topic.asp?h=0&a...

I posted there a table I threw together on how I choose cars:

akirk said:

	Type of Purchase	Depreciation	Repairs	Purchase Cost
1	New (lease / purchase)	Lots	No cost	Most Expensive (depending on deal)
2	Second-hand but with manufacturer warranty	Lots - Some	No cost	Less Expensive
3	Second-hand but with extended warranty	Some	Some cost	Less Expensive
4	Second-hand no warranty, and still depreciating	Smaller	More cost	Low Cost
5	Second-hand, no warranty, rock-bottom price	None	Highest cost	Smallest Cost
6	Second-hand, no warranty, classic, increasing in price	negative depreciation	Highest cost	Increasing Cost

For me, you either buy a car in category 1 / 2 / 3 / 6
Category 5 is okay if mechanical costs are likely to be less than depreciation elsewhere (i.e. reliable car)
Category 6 is fine if increase in value and lack of depreciation outweigh depreciation costs on a new car...

I am ditching the lease Skoda Octavia this summer - and have already bought its replacement, a 1994 RR LSE - V8 petrol engine at 15-17mph will cost less than the cost of leasing the skoda, and hopefully any work on it will be balanced by value increase...

[peld]

I am wont be looking as old as you, probably 5-7 years.

Looking in to it, if you can find the right car (and you arent unlucky) it seems a bargain, though its been a while since i owned a car with that high miles - MoT time was always a worry!

[LM95]

peld said:

I am wont be looking as old as you, probably 5-7 years.

Looking in to it, if you can find the right car (and you arent unlucky) it seems a bargain, though its been a while since i owned a car with that high miles - MoT time was always a worry!

It is an interesting situation especially when you look at what you can get for your money nowadays. Like you say a 2009 A4 Avant still looks fairly new even though it is now cracking on for 8 years old. The 5 series has not aged as well in my eyes (but that's subjective).

You can get the beautiful 159 estate in TI trim for this money

159 TI

And to go really boring but several years newer an Insignia,

Insignia SRI


And IF you can stomach the looks a Volvo S60 comes with quite a bit of Kit.

Volvo S60

We currently lease both cars in our household but I am seriously considering changing that to one and buying the other car, when you look at whats on offer for like you say 2 years in a new car all of the above must have lost most of their money and would surenly have 4 -5k left in them in another 2 years?

[kiethton]

Yeah my mileage is limited so went for the interesting older option.

cue 15k miles and 42 months in a E39 540i:

Repairs: £3k
General servicing/consumables: £600
Bodywork: £400
Depreciation: -£2500 (assuming its written off and I get the independent engineers valuation)

Tax, insurance and petrol are all pretty similar to what a newer leased car would be.

So total car costs excluding the above = £36pm
Lease = £260pm (that old M135i deal as a benchmark)

What's more Is I'm retaining the above as a known quantity for 10% of the write off value, can get it fixed for a little over bargain basement cost and it's a known (good) quantity until my insurers screw me over in the spring :/

[CDC]

Never leased or pcp'd. I do run the numbers every now and again to make sure i'm not missing a trick though.

I have always ended up buying old (10-15yrs) high spec/performance and then running with fingers crossed to an extent. Luckily i only do 3k miles a year and it's just weekend/social use. If i were to have to run something daily for a commute i imagine i may have to change tactics.

If it's of any interest, i bought a 2001 Jaguar XJR 4.0 Supercharged 4 and a half years ago. It cost £3.3k and i have spent about £5k so far on (largely preventative) maintenance (excluding insurance, petrol, VED). I couldn't see a way of getting that sort of performance and comfort any cheaper. I would like to think i could sell the car for at least what i paid for it.

[peld]

dont get me wrong, leasing on the right deal is great. When I got the Skoda I wanted to change cars anyway, the deals available for that cars launch were really cheap, and I had no intention of doing anything with out second car.

The thoughts here have come about because I have to change, and I have considered the leave vs buy option closer because I have more money to spend (didnt last time as I we were saving for a house, and we have now bought).

Agree on the A4 - they seem to change style very slightly every year, it's impossible to know nowadays which is the most modern unless looking at the number plate. In fairness the V60 is probably my face though, a DRIVe R-Design would be perfect which looks (just about) feasible for £8k (or will be later in the year)

[PTY]

Only recently had i understood the whole leasing aspect, I think what put me off leasing originally was because there was just too much commitment involved and too many numbers to figure out (deposit, mileage, packages etc) and for somewhat i can see the benefits of leasing as you do not have to worry about certain aspects of 'car ownership', but what i find most unappealing is the fact that you are basically covering the depreciation on someone elses car.

With 2nd hand cars you stand a chance of breaking even, making a profit or obviously sometimes losing it all (if you really do end up with some dodgy guy selling you a stolen or car thats just on its last legs), but in regards to the last one it is quite rare. Whereas leasing, as soon as you sign that paper you are 'guaranteed 100%' to be out-of-pocket each month, for x amount of months.

The last 3 cars i have had, i have essentially broken even on, so my car costs have been free for the past approx 6 years (Mid-range 3+5 series m sports) whereas i have family and friends who lease Fiestas + Polos for £150 a month, never mind the deposit they had to put down and any slight ding or scratch they have to pay extortionate prices for, on that average scale they probably would have paid around £8-9k JUST on the leasing cost for the same 6 year period. I haven't included servicing, road tax etc into this because those are to everyone's own choice, some might not service and still be running fine for 2-3 years etc.

So just from my own POV, we're talking about a 6 year period, someone comes up to you and asks "you could either drive this BMW for free OR pay me £8,000 for this brand new Polo which you will need to hand back to me afterwards" that's kinda how i always put it to myself when i see the option to lease a car.

Now fair enough you can say that I was 'lucky' to not have to pay any repair costs on any of the 3 cars over the past 6 years, but it goes to show that there are 2nd hand cars out there which can be fuss-free, you just have to spend time looking for them, just like how you would spend time looking for the right lease deal, but one is a lose-lose gamble and the other is a win-draw-lose gamble (just in terms of money).