Does It Make More Sense to Lease a New Car than to Buy One Now?By Angelica Malin
It wasn’t too long ago when leasing a car was something that people were not familiar with in the UK, but that has changed drastically in the last few years. Not that people have stopped buying cars here but a good number of them are now leasing new cars every few years instead. There are some unquestionable advantages that leasing has over buying, so does it really make more sense to lease than buy? The answer in most situations is yes, it does make more sense to lease. We will try and explain the reasons as to why that’s true.
Driving a Better Car at a Lower Price
A new Porsche 911 starts at nearly £80,000 and that’s just the base model. This puts it out of the reach of most people, even with finance. However, with Porsche leasing easily available in the UK now, the car has been made much more affordable than before. If you are wondering how that is possible, then you probably don’t know that when you opt for leasing instead of buying, your monthly payments will be calculated on the depreciating value of the vehicle and not the actual price of the car at the time of the purchase. Chances are that the necessary down payment is also either lower or not required at all, depending on the dealer. This doesn’t only hold true in case of Porsche leasing of course, but just about any car that’s available on lease. The more expensive a car is, the better it becomes for leasing, as compared to buying it.
Staying Updated is a Lot Less Expensive
At the end of the lease agreement, the car is simply returned to the dealer and the customer can lease another more recent model. Alternately, he/she can also choose to keep using the same car by paying off the rest of the depreciated cost, at which point, the customer will get complete ownership of the car. Leasing is particularly recommended for people who like to stay updated with their auto technology, rather than driving around in the same car for a decade.
Appreciation Vs. Depreciation
All successful investors and businessmen around the world believe in the concept of investing in objects with appreciating (increasing) value, while only renting, loaning or leasing properties that have depreciating value. As buying an expensive car would be investing in something that begins to lose value from the very day you buy it, it’s a better idea to just lease it instead of continuing to pay the same instalments for that two-year-old car, which just doesn’t make sense anymore.
Now, not everyone agrees with these points and some prefer the idea of complete ownership instead, but here’s the thing: unless you are paying the full price at one go, the car can still be taken away by the bank if you fail to pay the instalments in time. Therefore, it just makes more sense for people to lease a car from almost all aspects.