Depreciation estimates

[pigway]

I'm trying to decide whether to purchase used or lease a new car.

Could anyone point me towards somewhere I could find depreciation estimates / guides for a specific model of car, to help me do the maths?

[mcflurry]

If you look on the car website at a PCP that will give you a starting point.
Alternatively, look at the selling price of the equivalent older cars on autotrader or ebay to see what the older models did.

Crystal balls are also available

[pigway]

Thanks - that's helpful. So is it fair to assume that the final payment on a PCP is a pretty good guess at the residual value?

[Camelot1971]

A good rule of thumb is 50% off list in depreciation in 3 years, then 50% off that number at 6 years. A car with lots of options won't get you much more than a standard car when you trade it in but does seem to reflect in the price the dealer sells that car for.

Depending on the manufacturer, there are some great incentives on a new car too. For example, you can get an easy 20% off list on a 4 series Gran Coupe. If you look at nearly new 4 series though, most are priced at more than that!

It does vary a lot - decide on what car you want then compare the new offer to a used one.

Edited to add: if you are leasing a car the depreciation is irrelevant. A sign of a good lease deal is 20% of list price in total payments over a 2 year period. A lot more than that (i.e. 30%) would mean you might be better off getting a PCP rather than leasing.

Edited by Camelot1971 on Monday 30th April 15:54

[Tomo1971]

Camelot1971 said:

A good rule of thumb is 50% off list in depreciation in 3 years, then 50% off that number at 6 years. A car with lots of options won't get you much more than a standard car when you trade it in but does seem to reflect in the price the dealer sells that car for.

Depending on the manufacturer, there are some great incentives on a new car too. For example, you can get an easy 20% off list on a 4 series Gran Coupe. If you look at nearly new 4 series though, most are priced at more than that!

It does vary a lot - decide on what car you want then compare the new offer to a used one.

Edited to add: if you are leasing a car the depreciation is irrelevant. A sign of a good lease deal is 20% of list price in total payments over a 2 year period. A lot more than that (i.e. 30%) would mean you might be better off getting a PCP rather than leasing.

Edited by Camelot1971 on Monday 30th April 15:54

The 20% 2 year rule is for low mileage lease mind.... if your wanting more miles the cost per month goes up, as does the % of list price.

[pigway]

Thanks all, very helpful. It would be a low mileage deal if I go for a lease.

[numtumfutunch]

pigway said:

Thanks - that's helpful. So is it fair to assume that the final payment on a PCP is a pretty good guess at the residual value?

Yes!

In the bits of the motoring internet I hang out in there are a significant number of people coming to the end of BMW PCPs expressing surprise that the value of their car actually does approximate to the future value on their documents and they have effectively no equity to take to the next deal.

Its not rocket science.

The manufacturers have clever people to get it right. Too low and the PCP monthlies are crackers and too high leads to the customer having a buy it now price above the market rate leaving them with a car they have to sell on at a loss.

Its easier than ever to see what a car will actually cost and if you are in the right place at the right time its a lease every time.

Cheers