RE: PH Service History: To lease or not to lease
Discussion
It's pretty simple, most people would rather be driving a new 320d than a 10 year old 330d. When you're buying an appliance, you want the best you can afford, most of the time it's easier to finance than to buy outright, and better too. When an enthusiast is buying a car, then it's time to consider used, E.G a 911 Turbo S over an M4, or an Exige over a new hot hatch. We should be happy we have more of a chance than ever to own nicer cars.
For the last 23 years, I’ve always bought cheap used cars under £5k and I would usually run it till it became uneconomical to fix it.
Then 2 years ago, I came across a Passat Alltrack DSG (£35k list price) deal for £3156 inc vat over two years@5000miles p/a. Admittedly it was a misprice but I believe around 2000 punters went for it in the 6-8hrs the misprice was being published.
Surprisingly VW honoured all the agreement and I couldn’t be happier. Excess mileage is 7.2p/mile but you can buy updated mileage allowance in advance which made the excess mileage around 3.5p/mile so even with 22,000 miles already on the clock, I’m paying peanuts.
I was never a fan of lease deals but if you get cheap ones like the Alltrack/Golf R, then I suggest you go for it.
Pros - way cheaper than depreciation, new car, very reliable, manufacture warranty Road tax and Road rescue included, great MPG, cheaper insurance, safer etc.
Cons - you have to look after it as if it’s yours as you could get stung with repair cost when you return it, tyres must be matching (costly) and not some Chinese rubbish...
For me, I’d only go for another lease if it was a great deal!
PS - agree this article was very shoddy...
Then 2 years ago, I came across a Passat Alltrack DSG (£35k list price) deal for £3156 inc vat over two years@5000miles p/a. Admittedly it was a misprice but I believe around 2000 punters went for it in the 6-8hrs the misprice was being published.
Surprisingly VW honoured all the agreement and I couldn’t be happier. Excess mileage is 7.2p/mile but you can buy updated mileage allowance in advance which made the excess mileage around 3.5p/mile so even with 22,000 miles already on the clock, I’m paying peanuts.
I was never a fan of lease deals but if you get cheap ones like the Alltrack/Golf R, then I suggest you go for it.
Pros - way cheaper than depreciation, new car, very reliable, manufacture warranty Road tax and Road rescue included, great MPG, cheaper insurance, safer etc.
Cons - you have to look after it as if it’s yours as you could get stung with repair cost when you return it, tyres must be matching (costly) and not some Chinese rubbish...
For me, I’d only go for another lease if it was a great deal!
PS - agree this article was very shoddy...
MitchT said:
Won't consider leasing until there's some kind of insurance you can take out to cover the exit fee if you have to get out of the lease early. If you get made redundant and can't afford the lease payments anymore the last thing you want is to have to blow your redundancy payment on the exit fees when you need the money to pay for food and shelter while you find another job!
If you can't afford the lease payments for a bit if you find yourself between jobs, why the heck would you be even contemplating buying a new car in the first place? How reckless people are willing to be with their debt in order to have shiny baubles frankly boggles the mind.I fail to understand why we united (petrol heads) get so hung up on this subject... Different sources of finance may appeal to different people at difference stages of their lives.
Personally speaking leasing is not for me as I commute daily into London by rail (which is expensive) so I’d rather fund my cars with cash.
My GT3 is unlikely to depreciate so for ME (no one else) it meets my needs for high weekends and track day fun. It owes me nothing.
That said, my £400+ monthly rail ticket would probably yield a nice lease car so I understand why someone who commutes via road would want a new, reliable and very smart car. Leasing might be the best method for financing said car, so good for them.
As an investor I also see the appeal in PCP if you’re happy with the leverage. Invest the list price (less the lease deposit) into an investment of your choice; you can have the the car without closing out your investment.
Like I said at the start, different horses for different courses.
Gosh, I took out some horrendously expensive loans during the late 90’s to purchase various Pug GTIs. I bulk at the idea now, but it obviously appealed to a younger me whilst under the roof of ma & pa.
Personally speaking leasing is not for me as I commute daily into London by rail (which is expensive) so I’d rather fund my cars with cash.
My GT3 is unlikely to depreciate so for ME (no one else) it meets my needs for high weekends and track day fun. It owes me nothing.
That said, my £400+ monthly rail ticket would probably yield a nice lease car so I understand why someone who commutes via road would want a new, reliable and very smart car. Leasing might be the best method for financing said car, so good for them.
As an investor I also see the appeal in PCP if you’re happy with the leverage. Invest the list price (less the lease deposit) into an investment of your choice; you can have the the car without closing out your investment.
Like I said at the start, different horses for different courses.
Gosh, I took out some horrendously expensive loans during the late 90’s to purchase various Pug GTIs. I bulk at the idea now, but it obviously appealed to a younger me whilst under the roof of ma & pa.
Probably been said many times before, but here goes:
Without all these lovely people "buying" new cars, there would be less available for us to buy in a few years time....
I'm vary thankful to the chap in Tokyo that bought (not sure by what method) my NSX Type S back in December 1999, and specced the car in exactly the way he did. Without that, I wouldn't be here now commenting on this...
Without all these lovely people "buying" new cars, there would be less available for us to buy in a few years time....
I'm vary thankful to the chap in Tokyo that bought (not sure by what method) my NSX Type S back in December 1999, and specced the car in exactly the way he did. Without that, I wouldn't be here now commenting on this...
A highly enjoyable well written article this. Much more concise than reading endless forum pages on the topic.
I would also throw in that 'buying' new (or ex-demo 1500miles ish) on PCP and selling one year later has often offered me a more flexible solution to the same conundrum and for very similar outlay. Not 'cheap' but offers a known monthly cost against current income and I've only been stung once on the re-sale (Z4MC in the 2007 global market crash! Ouch)
Sadly new cars have moved far far away from my personal tastes as a piston head. £450 per month for a 344hp, lightweight, manual 6-speed with RWD is not something I can find or even get close to today.
I would also throw in that 'buying' new (or ex-demo 1500miles ish) on PCP and selling one year later has often offered me a more flexible solution to the same conundrum and for very similar outlay. Not 'cheap' but offers a known monthly cost against current income and I've only been stung once on the re-sale (Z4MC in the 2007 global market crash! Ouch)
Sadly new cars have moved far far away from my personal tastes as a piston head. £450 per month for a 344hp, lightweight, manual 6-speed with RWD is not something I can find or even get close to today.
Yes, the article has simplified it, but i would say its even simpler still too be honest. All you have to do is ask yourself three questions.
1. I am in the market for a new (or nearly new) car.
2. Am i happy to accept whatever the next 'deal' is and am not too fussy on car/spec,
3. Do i want to change my car every two/three years
If you answer yes to all of these then i would say leasing will suit you. Yes, there is the option of PCP, but i find them horrendously expensive compared to leasing because of the interest rates. Any equity that you build up in the car costs you at least twice that in the first place, so you may as well put it into a bank account ready for the deposit on your next lease.
1. I am in the market for a new (or nearly new) car.
2. Am i happy to accept whatever the next 'deal' is and am not too fussy on car/spec,
3. Do i want to change my car every two/three years
If you answer yes to all of these then i would say leasing will suit you. Yes, there is the option of PCP, but i find them horrendously expensive compared to leasing because of the interest rates. Any equity that you build up in the car costs you at least twice that in the first place, so you may as well put it into a bank account ready for the deposit on your next lease.
cholo said:
Yes, the article has simplified it, but i would say its even simpler still too be honest. All you have to do is ask yourself three questions.
1. I am in the market for a new (or nearly new) car.
2. Am i happy to accept whatever the next 'deal' is and am not too fussy on car/spec,
3. Do i want to change my car every two/three years
If you answer yes to all of these then i would say leasing will suit you. Yes, there is the option of PCP, but i find them horrendously expensive compared to leasing because of the interest rates. Any equity that you build up in the car costs you at least twice that in the first place, so you may as well put it into a bank account ready for the deposit on your next lease.
Not quite1. I am in the market for a new (or nearly new) car.
2. Am i happy to accept whatever the next 'deal' is and am not too fussy on car/spec,
3. Do i want to change my car every two/three years
If you answer yes to all of these then i would say leasing will suit you. Yes, there is the option of PCP, but i find them horrendously expensive compared to leasing because of the interest rates. Any equity that you build up in the car costs you at least twice that in the first place, so you may as well put it into a bank account ready for the deposit on your next lease.
1. Is it time you changed your car
2. Are you weighing up the cost per year
3. Are you happy to accept the next 'deal' vs happy to accept whats for sale
4. Are you happy to wait months for it to come through
5. Are you happy to lose it at the end of term ( it may be possible to extend)
If so you can get a newer and cheaper deal by lease than the buying selling and depreciation
I think this article misses the point of leasing, which is what i've realised over the past couple of years. With leasing, you go for the best deals out there at the time, not specifically the car you want. You can do the latter and you may get lucky and find that the car you one just happens to be heavily discounted. But, generally, to get the best value out there, you go for what's available.
Expanding on that last point, the first few batches of the Golf R deals were much cheaper than they are now, as we all know. I managed to get one of the very cheap B9 Audi A4 deals, but it's been a seriously dreary experience for me. Good value, but not my type of car. I was toying with replacing it with the cheap A5 Sportback offers out at current, but i'm not going there again.
I'm also looking to save some money and get myself on the property ladder. So, a cheap used car it will be, albeit something still fun to drive. It's a bit daunting, after leasing my last 2 cars, but i am looking forward to it really.
Expanding on that last point, the first few batches of the Golf R deals were much cheaper than they are now, as we all know. I managed to get one of the very cheap B9 Audi A4 deals, but it's been a seriously dreary experience for me. Good value, but not my type of car. I was toying with replacing it with the cheap A5 Sportback offers out at current, but i'm not going there again.
I'm also looking to save some money and get myself on the property ladder. So, a cheap used car it will be, albeit something still fun to drive. It's a bit daunting, after leasing my last 2 cars, but i am looking forward to it really.
herebebeasties said:
MitchT said:
Won't consider leasing until there's some kind of insurance you can take out to cover the exit fee if you have to get out of the lease early. If you get made redundant and can't afford the lease payments anymore the last thing you want is to have to blow your redundancy payment on the exit fees when you need the money to pay for food and shelter while you find another job!
If you can't afford the lease payments for a bit if you find yourself between jobs, why the heck would you be even contemplating buying a new car in the first place? How reckless people are willing to be with their debt in order to have shiny baubles frankly boggles the mind.Ideally you should be in property by then as well not renting nor living with mummy.
Same with iPhones. Apple shouldn't be as successful as they are because only 1% of the developed countries population should be buying them. Instead unemployed people make sure its the first thing they have even before food. Same with new cars due to pcp.
Edited by Audemars on Monday 22 January 09:02
if you have the cash, and remove any tax advantages some might have with company use then I reckon lease should rarely be cheaper. However, manufacturers have offered great lease deals instead of cash discounts to mask their sales problems and support their RRP. it's not that the lease deals on some Jap cars are bad, it's that the deals on Golfs and 135is are/were stunning.
It's a good strategy. it's hard to raise the RRP once you've lowered it or set a discount expectation to everyone. PCP deals can vary more easily.
weak article. I agree that it would be good for a more reasoned comparison. Buying a 6/12 month old car can make sense at one level - a lot of faults appear in that time before the car settles into a reliable 2-5 year period.
It's a good strategy. it's hard to raise the RRP once you've lowered it or set a discount expectation to everyone. PCP deals can vary more easily.
weak article. I agree that it would be good for a more reasoned comparison. Buying a 6/12 month old car can make sense at one level - a lot of faults appear in that time before the car settles into a reliable 2-5 year period.
now now!dobly said:
Probably been said many times before, but here goes:
Without all these lovely people "buying" new cars, there would be less available for us to buy in a few years time....
I'm vary thankful to the chap in Tokyo that bought (not sure by what method) my NSX Type S back in December 1999, and specced the car in exactly the way he did. Without that, I wouldn't be here now commenting on this...
Very nice!Without all these lovely people "buying" new cars, there would be less available for us to buy in a few years time....
I'm vary thankful to the chap in Tokyo that bought (not sure by what method) my NSX Type S back in December 1999, and specced the car in exactly the way he did. Without that, I wouldn't be here now commenting on this...
I believe mine was a Honda UK director's car, so we've got pre-reg to thank, too!
PS - what is this depreciation of which they speak..?
Seriously though, with all the FREDs on modern cars, there is a lot of potential to go wrong. With some desirable cars reaching stupid prices, I really can increasingly see the attraction of renting a new one over buying used.
Pommy said:
Do those who lease feel ‘emotionally’ less involved with their car?
Does owning feel more satisfying than renting it?
No. My current cars leased, my last car was PCP, previous car leased, prior to that owned. All get the same car, all have the same connection - actually, the fun of the current car means the emotional involvement is greater (also Italian Vs German).Does owning feel more satisfying than renting it?
The lease argument has been done to death. With new cars, leasing will nearly always be cheaper than buying outright. But the pull is often fixed cost motoring.
My current car will cost me £29,000 over 4 years and 60,000miles, including RFL. That car will almost certainly depreciate by a LOT more than £29,000 over 4yrs/60,000miles. Ergo, leasing is better value and eradicates risk.
I could buy an old car, or a lesser/s
t car, that will deprecate less than £29,000 over4yrs/60,000miles, but I don't want to.QED.
The comments section gets worse and worse these days. This used to be a friendly site for enthusiasts to share love of cars. These days the comments section seems to infested with obnoxious self-entitled aholes running down every single article or other forum members.
You don't pay for Pistonheads. If you don't like the content, don't read it. If it offends you so much that you feel it's neccessary to throw abuse at those who write it then why not do us all a favour and go elsewhere.
holes running down every single article or other forum members.You don't pay for Pistonheads. If you don't like the content, don't read it. If it offends you so much that you feel it's neccessary to throw abuse at those who write it then why not do us all a favour and go elsewhere.
As some have said, with leasing I'm vary wary of the additional costs come hand back time - tyre condition, dings, paint you may of had to have done and general condition - they are very picky seems they are looking to squeeze you for more cash.
I've seen them checking paint depth and charging for non- original paint.
You could end up paying a lot more out at the end of the lease.
I suppose its down to the company but id prefer to (buying wisely) purchase my own vehicles.
After all, that is part of the fun, no matter what your budget is there is always a great car to be had, new or second hand.
I've seen them checking paint depth and charging for non- original paint.
You could end up paying a lot more out at the end of the lease.
I suppose its down to the company but id prefer to (buying wisely) purchase my own vehicles.
After all, that is part of the fun, no matter what your budget is there is always a great car to be had, new or second hand.
foggy1974 said:
As some have said, with leasing I'm vary wary of the additional costs come hand back time - tyre condition, dings, paint you may of had to have done and general condition - they are very picky seems they are looking to squeeze you for more cash.
I've seen them checking paint depth and charging for non- original paint.
You could end up paying a lot more out at the end of the lease.
I suppose its down to the company but id prefer to (buying wisely) purchase my own vehicles.
After all, that is part of the fun, no matter what your budget is there is always a great car to be had, new or second hand.
Never had that, never even heard of that. Suspect it's old wives tales/scare mongering.I've seen them checking paint depth and charging for non- original paint.
You could end up paying a lot more out at the end of the lease.
I suppose its down to the company but id prefer to (buying wisely) purchase my own vehicles.
After all, that is part of the fun, no matter what your budget is there is always a great car to be had, new or second hand.
Whenever I've handed a car back, PCP or lease, they've barely looked over the car and certainly nothing like in as much detail as a private purchaser coming to your house to buy your old car.
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