in most scenarios cash is cheaper, but i would go for a lease in certain circumstances (although it may be more than cash) such as leasing a high performance car Audi RS, Merc AMG's BMW M's etc because when leasing the finance company owns the car - if theres anything wrong with it and the dealer isnt playing ball - your contract is with the finance company and they effectively have to sort it. When you buy the car its you versus the dealer. Secondly I wouldnt want to own a high performance car outside of warranty - with a lease you just hand it back - you dont have to try and sell it.
I remember the time when an E60 M5 was around £22k and the replacement gearbox from BMW was around £14k iirc. Ouch!
That’s what I would think but I’ve read articles saying it could take a few years to correct itself.Originally Posted by jaytip
I know very little about the car market but wonder if one day we’ll wake up and electric cars have improved so much that petrol and diesel cars literally tank in value almost overnight? Be good to know if that’s a realistic possibility or not.
I’d say that’s many many years away from happening. The infrastructure to support electric cars that need to do 100 mile round trips or more does not exist. It’s being built but it’s a long way away. Also, alternative fules are being looked into so we may be able to keep combustion engines indefinitely. A lot is happening in this space.
2010 wants its post back!
Oh the irony...
People without money pay more than people with money for the same thing.
Being rich is expensive if you are poor.
I'll get my coat without commenting on the macan.
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Thanks that’s really helpful.
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I'm poor,
I over paid my PT Cruiser.
I'm still fixing it after 16 years.
I'm sure you'll be fine!
One day electric cars will rule and gas will be dirt cheap, I'm quite looking forward to still being alive then. And with a license.
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Eh? I’ll have a 240 mile drive home after collecting my car and ill only have to stop to charge it once, and that will only need to be a splash and dash as it were.
I had a look at the Porsche website, and was surprised to see that they aren't currently offering 0% finance or deposit contributions (lol, as if).
What Car reckons the Macan is the third slowest depreciating car you can buy, and a quick fag packet calculation suggests that leasing would cost you at least £6k more over three years compared to buying outright. If you can do the 25% finance for less than £6k, then that's probably the cheapest most affordable option.
Not sure of the price for the mention car...let’s say 50K
50% down proceeds from other car £25K
25% down from savings - £12.5K
25% from loan - £12.5k
Assuming you keep the car 3-4 years what’s the likely cost of it then....25-30K? So you’ll be looking at losing close on 50% of the value in that time.
You’ve lost 25% of your savings and paid interest on a 12.5K loan.
Why isn’t leasing the sensible option? You can bank the £25k from the proceeds of the previous car, keep 12.5K in savings in the savings account, all you be losing is the monthly repayments on the lease, which would work out around the same as the depreciation if you’d had bought the car new and kept it for 3 years?
I may have rubbish maths but I can’t see past leasing.
Fine if you can find a lease deal where the total cost is less than the anticipated depreciation/cost of the car you're looking at. Unfortunately the days of deals like these seems to be over for now at least.
But how much would the lease of a £50k car be ? I presume something like £800/month at least
That may or may not work well for you. Stopping to charge at designated charging spots is what is proving to be the issue for the adoption of electric cars. Turning up to find only 4 charges, some are not working and the others are in use. Cars being cut off before reaching a charge capacity that is expected over a given time period etc
Not enough chargers in place to support a mass move to electric cars.
I’ve seen some Macan S lease deals at around £500-£600pm. Including the initial deposit that’s around £30,000 all in (4 years) which is more than depreciation and no extras.
Also the oldest Macans I see on Autotrader are still £35-£40k which suggests they keep more value than what is being suggested.
Albeit I accept prices are currently inflated.
Still sounds like the cash buy is best option if ‘one’ can afford it.
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Looking at lease companies 48 months deal cost anywhere from 530- 650 depending on model, length of lease etc.
Base model (48k) over 4 years with 3 months down you’d be dishing out 32k over 4 years. Looking on autotrader 4 year old Macans start from around 30k but that’s not what a punter would get for it. The numbers aren’t way off also considering you’re not paying interest and you’d be keeping 37.5k in your savings.
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You wouldn’t get 35-40k for your car though.
Buy a £5k fiesta and a load of watches -
Is this your experience or are you just regurgitating what you’ve heard/read?
Watch the recent Guy Martin documentary on making the fastest quarter mile electric car if you want a lesson in why the infrastructure is still years away from being remotely adequate outside of the urban centres. Electric stuff is wonderful for pottering around town centres, for longer journeys not so much. All those carparks with 3 electric points wont be much use when there are 200 electric cars parked there either so much work is still needed.
Not really going to happen.
The current market dynamics are not purely driven by that issue as there were a greater number of COVID related issues that drove the market in 2020 and then it was further compounded by the semi conductor issue this year.
The semi conductor issue is here for 2022 and into Q1/2 2023.
Or talk to people who actually own and drive the things rather than made for tv sensationalism.
Clearly there aren’t enough chargers right now to fulfil the demand five to ten years down the line.
Agreed on all points Dave.
Going on what I have seen on YouTube from many peoples experiences in the U.K. and also from what owners have told me. You don’t need to go far on google to see this is an issue. If you are charging at home and not doing long journeys electric cars are ideal.
Just my POV.
I'm a big fan of leveraging my cash so, for me, borrowing at a good rate is always my preferred choice. When I bought my GT4, they were offering me a really low GFV (a loss of £43k after 3 years). The bigger the gulf between the price you pay and the GFV, the more you pay, so the PCP wasn't great.
Ideally I'd have looked at a bank loan, but the dealers like you to take our their products to build relationships (to ever get a whiff of getting on their preferred list...I still would't hold your breath to get on that list though!).
In the end, I ended paying cash as I had just got a mortgage (at 1.4%!!) accepted and ,according to the broker, the bank were constantly checking my credit score and the car had been shipped just before I was due to complete.
I like cheap loans as I invest any free cash in shares, and (touch wood) it's always paid dividends (quite literally). So think about the opportunity cost - are you an investor? Are there better ways to use your money? Perhaps yes, perhaps no.
But I don't really buy into the old adage that it's bad to take out loans on depreciating assets....
I did say AFTER the semi-conductor problem is over. It may well take a few years but who I’m their right mind is going to pay 80% or thereabouts of the full retail price of a car if a new one is easily available?
Prior to covid and this semi-conductor issue most regular cars lost about 40-50% of their value after 3 years.
The second hand car market we are seeing today isn’t the true market.
The market we are seeing today is the true market, it's just the current market but it is nuts.
WBAC were offering 19k for our car in November and 25k yesterday. Don't understanding it myself but people are buying.
It'll get worse before it gets better IMO.
A lot of that depends on your attitude to risk, money is cheap these days but choosing to leverage it and invest in equities come with risks that not everyone will be willing to carry.
I agree it’s the current market but I don’t think it’s the true market. Prices are inflated as a direct consequence of the pandemic and then the semi-conductor shortage.
People were losing their jobs during covid or worried about losing them and with dealerships being closed and then online, people weren’t buying new. Then we have the chip shortage so the amount of new cars being sold is dramatically reduced, the used car market as gone berserk.
I really can’t see how it can be sustained once we are back to normal, or whatever the new normal will be.
Impossible for it to be sustained long term but it looks like it'll be this way until 2023.
If I wasn't getting bent over with house stuff for the foreseeable I'd looking for a deal on a new stock car.
I just bought a 4 week old car with 500 miles on it and got 10k of the original price so it’s worth looking for something like I got if your after value for money
I was always taught to buy cars outright as the “cheapest” way to own a car.
My last 3 cars have been on a lease and il tell you why.
I have picked up some sensational deals, (Audi q5 £299 a month, current car is an A6 all road at £299 a month), which taking into account I don’t have to pay for the road tax for two years (lease company is liable), no tyres to pay for (most second hand cars a year or two old need tyres replacing), I basically get a low cost driving experience for two years (length of my lease term).
Now the line of work I am in, I can buy a lock up garage for £15k and rent it for £140 per month. For example my current car has a list price of £58k. With discount I’d imagine £45k. I can buy 3 garages for £45k (freehold) giving me an income of £420 per month for the rest of my life. If my car is only £299 per month it’s a no brainer for me. I buy the garages outright which are an appreciating asset and lease the car which is a depreciating asset. In two years time if I were to have bought the car outright maybe it would be worth £30k maybe a bit more maybe a bit less. If I were to buy 3 garages at £15k each in two years time they would probably be worth £17.5k each and I’d have had the monthly income.
For me it’s all about spotting a cheap deal with a car your happy to drive and I’d happily lease forever and a day all the while in theory my initial car fund hasn’t lost a penny..in fact I drive for free if you plan and invest your capital wisely!
I think Yeti is a great example of a customer who makes lease work for them and, i'm guessing, it's more about the deal than the car or specifics. Where i've always struggled with leasing is that i usually want certain options (elec seats- wife is 5' 2, i'm 6') and that makes it harder in lease land. Also i take soooooooooooo long to make a decsion that by that point the good deal is gone :D
Those garages certainly give a strong yield … what’s the downsides?
Buy outright has always been my preferred option and that is what I did on my recent new (second hand car), though if you can get a low rate bank loan that seems decent, easily beat most dealer finance deals. Have to say some of the lease deals sound quite intriguing also, appears good value.
Listen, it isn't rocket science...
Buy a McLaren F1 new for £540k. Keep it in the garage for 25 years, undriven. Sell it for £18m.
Simple. And I thank you
None that I’m aware..
Nice ... do you get problems with non payment ... I could imagine people losing interest in their stored items and abandoning the garage ...
As a data point I have run a new Golf 2.0 TDi with all the extras at a cost of £237 / month over a period of 5 years. This factors in the opportunity cost of the capital at 5% which is relatively modest. This also factors in 16,000 miles per year.
If I put that option on one of the websites it comes back at £360 / month and £3000 up front payment.
Quite the opposite really..people pay the monthly rent for years to store items they don’t want to get rid of yet the cost of the items stored doesn’t equate to the rent paid..basically they could have binned it all and bought new when the time and come out better off financially. Crazy
You base your calculations over 5 years. I tend to get a new car every two years. Minimal servicing on my part, maybe the first oil service which is a small service, no road tax (which on £40k plus car is £500 odd a year).. hoardes for courses I suppose. If you have no issues after the warranty period then great but imagine year 4 your gearbox goes or year 5 the belt snaps…peace of mind for me is a monthly fixed cost for a new car under warranty.
Yeah, I can see the attraction of running a newer car …
It has always surprised me the amount of people that think a cars just going to fall apart a couple of years after the warranty runs out and it’s going to cost millions to fix. Half the problems with cars now is the stupidly long service intervals to pander to the company accountant or lease company that doesn’t want to pay to have them done.
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Quite right although it does seem luck of the draw. Some people have no issues after 10 years of ownership yet some people have problem after problem which can add up quite drastically if your paying for it out of your own pocket.
A car bought on finance is subject to the law of halves and thirds whereby you can walk away from the car if you have paid off half the loan amount. Be aware that with PCP the loan amount includes the balloon. I have taken advantage of this and handed back a pup of a Peugeot 407 coupe that had endless problems, dropped it off at the local BCA, got the paperwork signed and walked away. Contrary to popular belief this does not effect your credit rating or make you any less eligible for future loans.
For most of those here who seem able to comfortably afford to buy cars outright and are looking for the most economic way of owning a car it's probably moot, but for those of us driving cars in the middle years of their lives it may be worth paying a few extra quid a month for a get out clause like that. It's a bit of a nuclear option as you lose your deposit but as in the case of the Peugeot above that had already had £6000 of warranty work done on it in the first year, gearbox refurbished, gearbox replaced, multiple auto electrician callouts, replacement sensors, it then developed a horrendous screeching noise when driven over 50mph, wheel bearings were fine, tyres were changed, best guess was more gearbox / drivetrain issues and the warranty had expired so it sat on my drive for 3 months and then went back the day i reached half payment and I swallowed the loss as probably for the best.
What’s the thirds part?
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I'm looking at nearly new and have seen cars at ADs where the asking price has steadily increased from £17.5k to £20k over the summer and they're still unsold.
P/x values have similarly increased, I'm down just £1500 over 4 years on my Octavia Est diesel (only covered 25k miles), but the price to change is essentially the same.
I didn't understand the earliest comment about being in the same position whether you'd bought or leased as based on the increased second hand values I'd have been well out of pocket had I leased 4 years ago.
Last edited by deepreddave; 8th September 2021 at 09:28.
I've bought for cash all my cars (which have always been second hand or new from dealerships). I guess I am old skool - I don't buy particularly expensive cars or high powered engined ones - just practical 5 door hatchback style and don't drive many miles per year as have travel by train to work.
Example, Paid 10,000 for my last car in Auguust 2012 (that was registered on Dec, 2009) I can sell between 3000 - 4000 today so that's approx 6000 depreciation over 10years. + MOT (50) + Road Tax (250) + Annual Service (250) - lets say 600/annum for that add on the 600 / annum straight-line depreciation = 1200 / annum = £100/month equivalent.
I can't see any lease for £100/month around for any car?
I think I don't run in the same bracket as BMW MGx or Audi whatever that race up and down our road at 50+ mph - but that's a different thread. God I'm a boring old fart.
Last edited by MartynJC (UK); 8th September 2021 at 23:49.
“ Ford... you're turning into a penguin. Stop it.” HHGTTG
My wife’s lease is currently a BMW 2 series Grand tourer. We got it when they were practically giving them away. We pay £150 per month for it. No road tax as lease company pay it. List price of circa £32k. And it’s a 7 seater. I dare say it’s one of the cheapest premium cars you could get on a lease…
As said above, it suits me to have £32k in my bank working for me in other ways and drip feeding the lease company £150 a month without a worry in the world about depreciation etc.
There are a few under £100 as I was considering getting one for a loan car
https://www.selectcarleasing.co.uk/c...tial_payment=9
Of course this is business lease
Last edited by Franky Four Fingers; 9th September 2021 at 07:13.
This ^^^. Unless laundering money or avoiding tax.
Whoever does not know how to hit the nail on the head should be asked not to hit it at all.
Friedrich Nietzsche
What a load of rubbish!
It’s a car, a tool to get you around. It’s just the same as buying a sofa or a fridge etc, you buy it because you need it and it’s value (generally) reduces with time and use.
When it’s worn out, you buy a new one.
Granted, it’s best to buy outright if possible but for high value items, most people don’t have the cash to do that and pay for it in small chunks at a rate they can afford to.
Some of the really hard up people in this country have to borrow just to buy food, is it crackers that they don’t just starve until they have the cash to buy a loaf of bread?
Most businesses use finance to purchase major capital assets, earning far more from the asset than it costs them. Is that financially crackers too?
Last edited by Dave+63; 9th September 2021 at 09:07.
For many people it's more than just a tool to get around in. It's a status symbol, an aspirational purchase or whatever and such a high value item isn't needed.
Similar to buying an expensive watch on credit (obv. not SS Rolex or similar).
Agreed and spending money on an aspirational item if you can afford to (by cash or credit) can’t really be considered crackers either.
If you’ve earned it, you can spend it whatever way you want.
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