I'm looking for cars, nothing fancy just an estate, with air con and preferably cruise control.
The cheapest lease I can find is a Skoda at £187 a month/48 months so a total of £8976 plus a deposit of £1100, making a total £10,076. Then I give the car back.
Wouldn't it be better to take out a loan of £10k and buy a car with that, that should last beyond the 4 years? Yes it won't be as shiny but I should get a reasonable 2-3 year old estate for that money?
The other thing with the lease is that the £187 a month is based on 8000 miles pa, I do more like 16000, so presumably the monthly costs would be even more?
How much would you expect to pay on a lease for an estate car (bigger the better, mondeo size ish) with a reasonable (for me) mileage allowance?
I'm not looking for an Audi or BMW, but it would be nice if someone can point me in the direction of one for under £200 a month!! For what it's worth my current car is worth hundreds not thousands!
All cars explode just prior to being paid off and are liabilities.
Or no your reasonably right unless you find some really mad deal on something quite obscure and/or need a car of a certain age for work purposes.
Leasing / pcp prices have all gone up a lot recently compared to the 'very good' deals that have been around for the past few years. The new emissions test and reduction in production as a result along with the re-sale values dropping since diesel became a dirty word have affected the numbers.
Mileage will be your killer, if you are doing under 8k a year you tend to get okay deals as the resale value of the car is maintained, above that you start to see steep increases in the costs.
Always check what the excess mileage charge is as well before signing.
You could always have a loan and buy a car and after that period of paying the loan the car is yours to keep or chop in for something else. The allure of the lease is that of a new car on a regular basis, often maintained and for a set monthly payment.
No it is not you.
A small car on a low miles lease, for someone who doesn't have any mechanical inkling or care, who wants to *know* what things will cost for the next few years, then lease is good.
Personally, I do 25k miles a year and need a big car, ideally with some grunt for shifting canoes, bikes and kids. A lease for me is easily £4-500 a month, with a couple of £000 down. So a 3 year lease works out at £14-15k, plus tyres and servicing etc.
I can buy a decent car for just under £9k, run it for three years, with a couple of bills, and it is still worth £3k at the end. So the same 3 years cost me under £10k in comparable cost.
That's a four year lease (which I would avoid due to you needing to get the bugger MOTed etc after 3 years)
Here's an example 3-year lease (prepare for eyeball burning)
Total about 8K over three years. A brand new Octavia of that ilk would be 18K or so. A three-year-old one about 10K. A six-year-old one about 5-6K.
The point, I suppose, is not so much that you are paying 8K over three years for nothing, more that the alternative is also paying 4-5K over three years for nothing as well, plus you'd need to commit 10K of your cash in the first instance.
Obviously you can get an even older car, and pay less in depreciation costs, tilting things even further your way, but it depends on how new a car you actually want to drive.
EDIT: Oh, just seen your mileage. You will be able to get a 15K deal along the same lines, but you will certainly be looking at paying a bit more. My last excess mileage charge was at 6p a mile over the contracted amount, but they do vary.
https://www.nationwidevehiclecontracts.co.uk/car-leasing/ford/mondeo/estate?mileage=17500&term=36
£369/MTH
£2200down
=£15k+ over three years.
(Plus servicing from main stealer, tyres etc)
You often get a better deal if you get your brother in law to sign the deal.
There are few stonking deals around now. Only a few months ago you could have had an 1l Octavia estate for £99 per month!
£369/MTH
£2200down
=£15k+ over three years.
(Plus servicing from main stealer, tyres etc)
So £15500 roughly over 3 years. Yes the serving is included, even with a set of tyres that is probably worth £1k.
Or one of these for £14 k ish
(Ok no estates shown, but I'm sure with a bit more shopping around they shouldn't be hard to find)
And I get to keep it. Are all the fancy BMW/Audi's then on very low mileage lease deals? Or do people really have mega bucks to blow on one? Just wondering how people manage it (obviously different if you have a large income)
You often get a better deal if you get your brother in law to sign the deal.
Depends if you try to cancel it or not.
Are all the fancy BMW/Audi’s then on very low mileage lease deals?
Nope my BMW 330e was 15k miles, fully serviced/maintained. £330pm
Bought it off the lease company since.
Personally to me leasing is about fixed cost shiny new cars. I wouldnt do one on more than a 2 yr deal
Good luck getting a brand new Skoda for 10K. I think thats the bit you're missing.
Why would you worry about moting a 3 year old car .....
I think that the bit you are missing is in the description and the meaning of it:
PCP. Contract hire. Money up front, 'low' monthly rates, big sum of money to pay at end of contract.
Lease. No money up front, realistic monthly rates, no money at end of lease. Usually for businesses.
I leased a Volvo XC60 directly from Volvo.
60,000 miles over 3 years. Good monthly rate, includes RFL. It means that I have pretty fixed costs over the 3 years, 1 service per year and probably 1 set of replacement tyres, insurance.
No MOT, no depreciation, no cash outlay from the business, (its better to spend my money on products and materials for sale to customers).
Reliable motoring for 3 years.
Then rinse and repeat in 3 years.
<blockquoteNo MOT, no depreciation, no cash outlay from the business, (its better to spend my money on products and materials for sale to customers).
Reliable motoring for 3 years.
Then rinse and repeat in 3 years.
You still pay depreciation. There is no getting away with it in car ownership. It is factored into your monthly payments.
Good luck getting a brand new Skoda for 10K. I think thats the bit you’re missing.
Don't think I would get a new Skoda for 10k, but this is about the most efficient way of car use.
, (its better to spend my money on products and materials for sale to customers).
And of course you save the VAT compared to personal lease.
Audi, BMW, Merc - all cheaper on lease deals than equivalent priced Ford etc. Lease deals are all based on residual value, factoring that plus adding a bit of profit.
My last car was a Mercedes E class, 220 AMG Premium plus with a bucketload of options, P11d value was £58k and it was 550 per month. (my car allowance is 600 per month)
How much is a £60k car a month to buy?? over 5 years (and on a 0 interest deal) its twice that, so far cheaper to get a very nice car and in 3 years, boom new car.
Thats when it makes sense.
sc-xc; Ha! Ling Valentine - that was a great thread.
Do you pay 40% tax on the allowance or is it based on the £58k value?
. (my car allowance is 600 per month)
Again, it works for you due to vat saving and it being part of remuneration.
It's different doing it privately.
Audi, BMW, Merc – all cheaper on lease deals than equivalent priced Ford etc. Lease deals are all based on residual value, factoring that plus adding a bit of profit.
So it can be cheaper to leave a 5 series /A6 than a mondeo? Yes they have higher residuals, but don’t they depreciate at the same % a year, ?
So it can be cheaper to leave a 5 series /A6 than a mondeo? Yes they have higher residuals, but don’t they depreciate at the same % a year, ?
I think Steve was saying that a bottom spec 3 series that costs £28k might be cheaper to lease than a £28k Mondeo Vignale (top of the range, lots of toys) because in three years the BMW will be worth £15k and the Mondeo will be worth £12k. so with the BMW you need to pay (£28k-£15k=) £13k of deprectiation, and on the Mondeo you need to pay (£28k-£12k=) £16k of deprectiation.
But the cheapest 5 series costs more than the most expensive Mondeo, so you'd have to really stretch it to find a crossover point where a decently specced 5 series was cheaper (not as a % of RRP, but actually less money each month) than a Mondeo.
I bought a 5 year old Volvo Estate for £3900 in 2007. That lasted me 10 years until I scrapped it. I bought my wife a Volvo C30 for £10k 6 years ago and hopefully there is another 4 years in it. Both these cars have only ever presented one large bill both circa £600.
My current car is another Volvo (sorry!) a V70 fully loaded with all luxuries bought 1.5 years ago for £8k at 7 years old. Hopefully get another 5 years out of that.
The maths I do says leasing doesn't work.
The maths I do says leasing doesn’t work.
There are so many good quality used cars for sale in the uk that buying one, rather than leasing a new one makes more sense to me. Or even buying a new one and keeping it until it is worn out.
The only way this doesn’t work is if you want a new car regularly or you wear them out quickly.
...making a total £10,076. Then I give the car back.Wouldn’t it be better to take out a loan of £10k...
That's not a very fair comparison, unless you have access to loans at 0%
Otherwise you're either paying more, or you'll have a lot less than £10k to play with.
The maths I do says leasing doesn’t work.
There are so many good quality used cars for sale in the uk that buying one, rather than leasing a new one makes more sense to me. Or even buying a new one and keeping it until it is worn out.
My maths says insurance is pointless, my maths says black is white and 1 = 2 - I can generally make the numbers prove what I need to, what you can't do is measure risk and your feeling towards it etc. they are different products for different people with different circumstances so you need to work out what you need from your transport, what you need form a car and what you are willing to risk.
But if you get the loan and buy an older car, how are you going to make people think you are rich ? 😉
Buy a Land Rover, duh!
(rich and stupid)
Yes, you're trying to convince someone else that your decision is more appropriate than theirs.
The debate was also over the minute you compared a new car to a used car.
The benefits to lease are numerous if you want a new car and the lease payments beat the depreciation of purchasing the exact same car.
Other benefits are; no tax, warranty, no mot, breakdown cover, no selling hassle etc, no capital outlay as spreading the cost, insurance in my experience is cheaper than on second hand banger. And almost certainly less likely to have mechanical problems.
Most of this stuff is argued on hotUKdeals quite regularly.
I was going to post along the lines of leasing being for people who don't mind paying to have a shiny car on their drive or those with an irrational fear of the MOT...Martinhutch, I'm afraid you have just demonstrated my point re: MOT!
heaper than on second hand banger. And almost certainly less likely to have mechanical problems.
Is this really true? I'm guessing most car parts follow the bathtub reliability curve so high initial failure rate, long period of constant failure rate and increasing rate as parts wear out. So the sweet spot should be a nearly new car until it gets say 8 years / 100k miles or whatever it's design life is.
Good luck getting a brand new Skoda for 10K. I think thats the bit you’re missing.
This and also even if you did, by some miracle, get a brand new Skoda for 10k then you’ve got to service it, tax it, MOT it after 3 years and insure it. With lease deals these things, or most of them, are covered.
Then after your 4 years you’ve got to sell it and will probably only get 5k for it if you’re lucky, so you’ll need another 5k+ to find to purchase your replacement car assuming you’re not going to go from a 10k car to a 5k car.
Leasing may not be as cheap as Buying used, but it isn’t much more when you factor in all the costs and depreciation and the hassle and risk factor, in that you could buy a pup, and the fact you have a brand new car instead of a 5 yr old one.
However we went PCP which I think is like leasing in that the costa are similar over the same time frame, but you have options at the end of the term.
Mot really isn't that scary a prospect.
It's a minimum standard which really is minimum.
Your car can pass an mot and still be a raft.
But then I do think people generally get their pants pulled down by using shit garages . Like a good lbs a good relationship with the garage is a must
I've always been a bit of a fan of the 4-6 year old car in the same way and for the same reasons as Matt-oab.
But our current car (just over 6 years old, had it less than 3 of those) is burning cash on unscheduled maintenance (i.e. component failures) at a frightening rate, both mechanical and electrical. We are down around £2000 in last 18 months and that's before it having needed tyres, servicing, cambelt (age and mileage) and gearbox oil change. This was a main dealer serviced car that's not yet done 90,000 miles.
Mondeo I had before didn't cause this much cost in 8 years.
Sometimes this strategy wins and sometimes you get a complete spanking.
I've had a pup of a new contract hire car before but each time it went wrong the garage was given the keys and I came back when it was done.
It's not just about cost. It's a balance between risk, cost and hassle. Recent experience has me looking at PCP and lease with my own money for the first time ever. I don't imagine it will be cheaper but it might be more comparable to the cost of a bad 4 year old car than some people would give credit for.
Interesting viewpoints, want a new reliable car every 2-3 years a lease is for you.
Personally I get a car allowance but I save it, I don’t care about cars so will end up buying a second hand 6-24 month old car low mileage and run it for 3-4 years.
I’ve either been lucky or cars are getting better at passing mots, I’ve not had any huge mot bills for 8 years now
I'm not sure leasing or PCH are ever the best financially over a 3 year period. Interest rates are cheap at the moment so getting a loan, buying a new car + selling it after 3 years is probably always going to save you money over leasing as the big cost in all that is the depreciation of the car, which applies to however you finance it it's just on leasing deals they add their profit margin on to. Leasing is more just taking away some of the hassle (arranging large loans, selling the car after) and guaranteeing the financing (e.g. if the car depreciates faster than expected that's not your problem)
bought a 5 year old Volvo Estate for £3900 in 2007. That lasted me 10 years until I scrapped it.....The maths I do says leasing doesn’t work.
And my maths says that for a fair whil you were driving a 15 year old car that had one wheel in the scrapyard.
Lots of people don’t want to do that.
Just like lots of people don’t want a 20 year old kitchen with drawer fronts hanging off and doors that don’t shut straight.
They do the same job in a way, and you can still make your dinner in a 20 year old kitchen. But a newer one is a far nicer place to be if you are willing or able to pay for it.
I’m not sure leasing or PCH are ever the best financially over a 3 year period. Interest rates are cheap at the moment so getting a loan, buying a new car + selling it after 3 years is probably always going to save you money over leasing as the big cost in all that is the depreciation of the car,
Not always for every car. But certainly every car I've leased in the last 10 years by quite a margin.
We had two skoda yetis on lease (high end models) they cost £4423 each to lease over two years.
I'm currently with a Karoq which is costing me 2640 a year to lease over 2.5 years.
No chance either of them will come close to depreciation.
FuzzyWuzzy has it. It's all about trade-offs - if your priority is hassle-free, fixed (more or less) cost motoring, then leasing is a good option. If you are prepared to put up with the chance of picking up the tab for a major fault, and don't mind the hassle of financing and selling on/trading in then an older second-hand car will probably save you a decent whack of money. You also have the flexibility to change the car when necessary if your circumstances change.
We have one lease, one SH car.
Is this really true? I’m guessing most car parts follow the bathtub reliability curve so high initial failure rate
Well you've got no wear and tear for a start. In the periods I'm talking about for 2 - 3 years.
And out of the 12 cars we've leased between us we've had zero garage visits (other than two cheap services.)
Some leases seem to include servicing, but a better description would be
“we include an oil change, any consumables such as brake pads or tyres you will have to pay for.”
Or can someone point me in the direction of a lease where consumables are included?
I’m just trying to work out the cheapest way of using a car!
You need to search for 'maintenance included' which might be sold as a package alongside the actual lease deal.
Probably turns out more expensive unless you are particularly hard on tyres/brakes
Doesn't matter how hard you are on it, if your local roads look like they were modelled on a green lane then problems are inevitable.
If a car you are leasing is a complete pup can you just hand it back? The example I'm thinking of was a Q7 that despite being taken to Germany for diagnosis still had an electrical drain that would flatten the battery in 8 hours. Guy literally had to cary a spare battery wherever he went.
her name has been said twice now, let's not make it a third!
Op your maths is sound and I went through the same last year. I gave a lease car having underestimated the mileage and ended having to stump up £1500 odd in mileage charges, this negated the low monthly payment I had been making for 2 years. Take a loan and pay it off as quickly as you can afford and pray the car lasts for a few years after the loan is gone. Once my loan is paid I'm going to start chucking the same money into a savings account so when it comes times to replace the vehicle I'll need a smaller or no loan..