[AiredaleDad]

Originally Posted by amol24

many people want to drive a lot of different cars so the flexibility a lease provides over buying a car allows them to do that

Not sure I buy that one as a valid reason. If that was the case there are subscription services with some of the car rental companies and manufacturers. I believe Enterprise and Sixt have it. I know Volvo does as well, and I think Audi.

With them, you pay a one time membership buy-in, and a monthly subscription for the tier you want to be on (Class of cars) and depending on what tier you are on you can select a new car every month depending on your needs. You can have an SUV one month, a Sedan or sports car the next and so on. You can even pay a fee for a one-month up class if you want a fancier car for a month. That is for people who want to drive a lot of cars.

Leases are more for corporate executives who get a new company car every 2 or 3 years before the warranty is out. Also for non-corporate people who want a new car every 2 or 3 years, don't put a lot of miles on their cars, and either don't want to commit the amount of capital or commitment to purchase, or can't. I don't think it has to do much with credit, because some leases require a higher credit rating than a bank would for a purchase.

[AiredaleDad]

Originally Posted by SW17LS

Ultimately IMO its self defeating as it diminishes the brand, clogs up dealer service departments, etc.

Agreed. However have you ever noticed that the service departments also give different levels of service? Case in point. I used to live in Seattle, and I had a 1996 Land Rover Discovery. I got treated decently at the dealership whenever I went in for service. A few years later I bought an LR3 in 1996 at a different dealer and the first time I took it to my SAME dealer in Seattle for service I noticed a bit more respect from the staff, and lower wait times for oil service etc. Some times I noticed getting jumped in front of people driving lower tier vehicles like the LR2, Dicoveries, etc. Then one day a few years later, and only 3 months since my last service, I had exchanged it for a Range Rover Sport. Now, not only at the same LR Seattle dealer I had been going to for years, but others in Oregon and California, I was given the red carpet treatment. Instead of having to pay for service loaners (for oil Changes, not repairs under warranty), I was given them for free always. They offered to come pick up my car and deliver it back to my home. They asked if they could bill me instead of insisting I pay immediately when I picked up my car. And now the car was dried after washing it after service instead of still wet.

I haven't owned a BMW since 1993, so I don't know if anyone has similar experiences with BMW dealers, where owners of Higher end models seem to get treated differently than lower end.

[DrVenture]

I have had many Fords and the local dealer always treated me like I own a Range Rover, apparently. I only go for warranty or recalls, basically. I fear that if/when I need the local BMW service department, I will be treated like I own a Yugo. lol

[M4Tejas]

Who would be surprised?


Portrait of George Petras George Petras
USA TODAY

Credit card debt, the amount owed by all Americans on their credit cards, rose to a record $1.13 trillion at the end of last year, the Federal Reserve Bank of New York reported Tuesday.

Card balances increased by about $50 billion, or 4.6%, in the fourth quarter of 2023.

https://www.usatoday.com/story/graph...n/72505645007/

[M4Tejas]

Originally Posted by AiredaleDad

Agreed. However have you ever noticed that the service departments also give different levels of service? Case in point. I used to live in Seattle, and I had a 1996 Land Rover Discovery. I got treated decently at the dealership whenever I went in for service. A few years later I bought an LR3 in 1996 at a different dealer and the first time I took it to my SAME dealer in Seattle for service I noticed a bit more respect from the staff, and lower wait times for oil service etc. Some times I noticed getting jumped in front of people driving lower tier vehicles like the LR2, Dicoveries, etc. Then one day a few years later, and only 3 months since my last service, I had exchanged it for a Range Rover Sport. Now, not only at the same LR Seattle dealer I had been going to for years, but others in Oregon and California, I was given the red carpet treatment. Instead of having to pay for service loaners (for oil Changes, not repairs under warranty), I was given them for free always. They offered to come pick up my car and deliver it back to my home. They asked if they could bill me instead of insisting I pay immediately when I pickled up my car. And now the car was dried after washing it after service instead of still wet.

I haven't owned a BMW since 1993, so I don't know if anyone has similar experiences with BMW dealers, where owners of Higher end models seem to get treated differently than lower end.

Dealers are only good as "the people" who work there. Some car dealership owners are suspect at this time. Employees at these dealers are stuggling for the most part. Dealers and automotive brand makes are a "dime a dozen"......

[carseatsm5]

Again I didn’t mean for this to be a lease vs. buy thread but here we are.

I think a lot of valid points have been made about how it’s a personal decision based on how you value money vs. how you value certainty of cost (risk of loss) vs. how you value having the next new thing etc. In that context there is no one right answer. Can we agree?

[tekphobius]

It's the only way some people can afford to drive these types of cars.

I'm not mad at them. I certainly enjoy purchasing a CPO BMW that's fresh off a two-year lease and has already taken the deprecation hit.

[AiredaleDad]

Originally Posted by tekphobius

It's the only way some people can afford to drive these types of cars.

I'm not mad at them. I certainly enjoy purchasing a CPO BMW that's fresh off a two-year lease and has already taken the deprecation hit.

Yeah, good luck. You beware of that 2 year CPO. It just might be too good to be true. I have read here and other places, and personally known a few Lessees,(including my brother), treat their leased cars like a road trip rental. No worries about proper charging to maintain battery life, or proper break in of the engine in an ICE car. And those are just 2 examples. All because "It's just a lease, it's the next owner's problem. They mostly care about not going over mileage, and not getting any visible damage that will cost them money when they swap out for a new car. Those are the ones that give Lessees a bad name. Even when test driving a 540i in Concord, CA the SR encouraged me to "Just Punch it!". After my experiences, I don't think I will ever do anything besides a Custom Order from now on. I want a car nobody has had the chance to abuse yet.

I bought a 2013 Range Rover Sport in 2015 as a CPO Lease Return. When I went to pick it up, during the inspection I noticed that it needed new tires, One of the headlights had a tiny crack in it (I almost didn't notice it), the fuel door latch was almost broken off, they only had one key fob, and the tint was so dark on the Rear window, and Driver and front passenger side I could hardly see out the windows. And THIS was a CPO car! At a Major West Coast Land Rover Newport Beach Dealership Shouldn't the CPO Inspection have caught all those things? Should the dealer not have repaired them before they put it on the lot for sale? The answer is an absolute yes! However not everyone is as meticulous as I am. I demanded, of course that they correct all of this before I would sign the papers. But if I had driven off the lot, it would have fallen on me to pay for all that.

So you just never know how the previous Lessee treated their car. And you never know if there are any hidden, or just difficult to notice issues behind a CPO car. And nobody expects a used car to be perfect. I am sure quite a lot of Lessees treat their cars as if they owned them. But a lot more out there just don't care because to them, that feeling of ownership never takes place. The Dealership just wants to move their used car inventory for the most profit possible. That means if they can save on reconditioning repairs and hope the buyer won't notice, they will.

Note to Lessees: I am not bashing all of you. I believe everyone has a right to buy or lease the car of their choice, for whatever reasons, (Financially or otherwise), that they want. I respect everyone whether you buy or lease. I know there are very responsible Lessees out there and have met a few of you on this forum. Thank you for taking care of your cars so the next owner gets a quality, cared for vehicle with no hidden time bombs due to neglect.

Note to Dealers: I know there are honorable dealerships out there, who are very meticulous in their CPO Vetting program, and would refuse to CPO a car that did not meet standards. My comments reflect my personal experiences, and opinions about the automobile industry and the used car sales culture.

[tekphobius]

Originally Posted by AiredaleDad

Yeah, good luck. You beware of that 2 year CPO. It just might be too good to be true. I have read here and other places, and personally known a few Lessees,(including my brother), treat their leased cars like a road trip rental. No worries about proper charging to maintain battery life, or proper break in of the engine in an ICE car. And those are just 2 examples. All because "It's just a lease, it's the next owner's problem. They mostly care about not going over mileage, and not getting any visible damage that will cost them money when they swap out for a new car. Those are the ones that give Lessees a bad name. Even when test driving a 540i in Concord, CA the SR encouraged me to "Just Punch it!". After my experiences, I don't think I will ever do anything besides a Custom Order from now on. I want a car nobody has had the chance to abuse yet.

I bought a 2013 Range Rover Sport in 2015 as a CPO Lease Return. When I went to pick it up, during the inspection I noticed that it needed new tires, One of the headlights had a tiny crack in it (I almost didn't notice it), the fuel door latch was almost broken off, they only had one key fob, and the tint was so dark on the Rear window, and Driver and front passenger side I could hardly see out the windows. And THIS was a CPO car! At a Major West Coast Land Rover Newport Beach Dealership Shouldn't the CPO Inspection have caught all those things? Should the dealer not have repaired them before they put it on the lot for sale? The answer is an absolute yes! However not everyone is as meticulous as I am. I demanded, of course that they correct all of this before I would sign the papers. But if I had driven off the lot, it would have fallen on me to pay for all that.

So you just never know how the previous Lessee treated their car. And you never know if there are any hidden, or just difficult to notice issues behind a CPO car. And nobody expects a used car to be perfect. I am sure quite a lot of Lessees treat their cars as if they owned them. But a lot more out there just don't care because to them, that feeling of ownership never takes place. The Dealership just wants to move their used car inventory for the most profit possible. That means if they can save on reconditioning repairs and hope the buyer won't notice, they will.

Note to Lessees: I am not bashing all of you. I believe everyone has a right to buy or lease the car of their choice, for whatever reasons, (Financially or otherwise), that they want. I respect everyone whether you buy or lease. I know there are very responsible Lessees out there and have met a few of you on this forum. Thank you for taking care of your cars so the next owner gets a quality, cared for vehicle with no hidden time bombs due to neglect.

Note to Dealers: I know there are honorable dealerships out there, who are very meticulous in their CPO Vetting program, and would refuse to CPO a car that did not meet standards. My comments reflect my personal experiences, and opinions about the automobile industry and the used car sales culture.

That's always a concern. But you could also buy a brand new one that was road tested by some guy with a youtube channel too. I bought a CPO m40i 4 years ago that didn't give me a single ounce of problems. My CPO x3mc also has given me zero issues. If it ever did, BMW would fix it. It also doesn't surprise me that you had a problem with a Range Rover. They're well known for being bottom of the barrel for reliability.

[Dégoûté]

Only suckers buy new cars. Imo.

[carseatsm5]

I think it’s pretty unambiguous that if we fix the variables to be (1) buy and hold a new car “long term” vs. (2) lease same new car and keep theoretically rolling into new lease for another (same) new car “long term” then buying will cost fewer dollars. Probably also need to assume maintenance costs post warranty fall within some reasonable level. “Long term” would be something like at least 2-3 lease cycles I would think.

For any one-time lease vs. buy decision for the same new car it’s possible either costs fewer dollars (based on disposal of new car at end of leased car’s term) depending on depreciation scenarios (assuming both have warranty while held) and cost of financing.

None of this assumes “business leases” which can be very favorable tax wise. But even so I think as a “long term” approach would cost more dollars than buying.

[Emily172013]

I'm an old guy and have always lived by what I as taught when young, and it's worked for me, "never pay retail and never pay interest".
Not to say other people have other circumstances, so do what you think is best for you.

[ChrisWMT]

Since I have a 2025 M340 on order, figured I'd do some quick knuckle dragger math after reading this thread.

Vaguely analyzing cost of ownership over 10 years buying vs leasing similar model over and over:



YMMV

[NickyC]

Originally Posted by M4Tejas

Who would be surprised?


Portrait of George Petras George Petras
USA TODAY

Credit card debt, the amount owed by all Americans on their credit cards, rose to a record $1.13 trillion at the end of last year, the Federal Reserve Bank of New York reported Tuesday.

Card balances increased by about $50 billion, or 4.6%, in the fourth quarter of 2023.

https://www.usatoday.com/story/graph...n/72505645007/

Repos are up massively as well. I think the long awaited return to sanity in vehicle pricing could be just over the horizon. Everything is far overpriced and many are breaking financially.

[M4Tejas]

Originally Posted by NickyC

Repos are up massively as well. I think the long awaited return to sanity in vehicle pricing could be just over the horizon. Everything is far overpriced and many are breaking financially.

Graphics show how Americans' total credit card debt reached record high

Portrait of George Petras George Petras
USA TODAY

Credit card debt, the amount owed by all Americans on their credit cards, rose to a record $1.13 trillion at the end of last year, the Federal Reserve Bank of New York reported Tuesday.

Card balances increased by about $50 billion, or 4.6%, in the fourth quarter of 2023.

Credit card delinquencies, the amount of time in which cardholders fall behind in making payments, also increased. The percentage of card delinquencies 90 days or more rose to 6.4% from 4% in the fourth quarter of 2022.

[SW17LS]

Originally Posted by Dégoûté

Only suckers buy new cars. Imo.

Work harder and maybe you can afford to not care about depreciation too lol

Originally Posted by ChrisWMT

Since I have a 2025 M340 on order, figured I'd do some quick knuckle dragger math after reading this thread.

Vaguely analyzing cost of ownership over 10 years buying vs leasing similar model over and over:



YMMV

That $70k when properly invested should also be worth ~ $180,000 after 10 years assuming an S&P average 10% RoR. So you back the $156,600 out of the $180,000 your $70k you spent on your car would be worth and you have $24,000....so leasing only cost you $46,000 over 10 years, saving you $20k from having bought and kept the car for 10 years.

Plus you're driving the same car for 10 years while I get to experience 4 different cars during that time. I don't want to drive the same car for 10 years :

Had you gotten a loan for the $70k initial purchase and paid 6% interest, that would have been $13,500 in interest, which would have meant you still would have had a $31,500 return on your initial $70,000 you paid even after backing out the costs of owning the car including the interest. Thats why paying cash for cars isn't a good financial move IMO.

[Dégoûté]

Originally Posted by SW17LS

Work harder and maybe you can afford to not care about depreciation too lol

.

[ChrisWMT]

Originally Posted by SW17LS

Work harder and maybe you can afford to not care about depreciation too lol



That $70k when properly invested should also be worth ~ $180,000 after 10 years assuming an S&P average 10% RoR. So you back the $156,600 out of the $180,000 your $70k you spent on your car would be worth and you have $24,000....so leasing only cost you $46,000 over 10 years, saving you $20k from having bought and kept the car for 10 years.

Plus you're driving the same car for 10 years while I get to experience 4 different cars during that time. I don't want to drive the same car for 10 years :

Had you gotten a loan for the $70k initial purchase and paid 6% interest, that would have been $13,500 in interest, which would have meant you still would have had a $31,500 return on your initial $70,000 you paid even after backing out the costs of owning the car including the interest. Thats why paying cash for cars isn't a good financial move IMO.

Excellent explanation and thank you for that perspective. I’ll definitely give this some more thought and detailed number crunching. Much appreciated!

[carseatsm5]

Originally Posted by SW17LS

That $70k when properly invested should also be worth ~ $180,000 after 10 years assuming an S&P average 10% RoR. So you back the $156,600 out of the $180,000 your $70k you spent on your car would be worth and you have $24,000....so leasing only cost you $46,000 over 10 years, saving you $20k from having bought and kept the car for 10 years.

Plus you're driving the same car for 10 years while I get to experience 4 different cars during that time. I don't want to drive the same car for 10 years :

Had you gotten a loan for the $70k initial purchase and paid 6% interest, that would have been $13,500 in interest, which would have meant you still would have had a $31,500 return on your initial $70,000 you paid even after backing out the costs of owning the car including the interest. Thats why paying cash for cars isn't a good financial move IMO.

That is misleading.

If you want to account for opportunity cost you’d have to calculate “lost return” for each dollar out for each option over the time horizon. You only accounted for opportunity cost of the purchase despite the lease consuming substantially more dollars over the period.

You are right to say that the actual apples-to-apples would be a financed purchase vs. a lease since a lease embeds a financing cost that a cash purchase does not. So a true like-for-like would be a ten year car loan (or more realistically a 5yr refinanced into a new 5yr) in his stylized example which equalizes out the large cash outflow at the start.

The answer becomes obvious that in the long-term leasing costs substantially more dollars with or without opportunity cost.

[Polo08816]

Leasing may end up being more costly if you drive significantly more miles per year than the average person.

If you drive 25,000+ miles per year, you'd have to lease 2 vehicles because most leases only go up to 15,000 miles.

There are some vehicles that are worth leasing and some that are not. BMW leases were heavily subsidized in the past - we may get back to a point where that's the case.

In retrospect, I would probably lease a vehicle that I would be tracking. 15,000 miles at the track is like 100,000 street miles.

[tekphobius]

Originally Posted by SW17LS

Work harder and maybe you can afford to not care about depreciation too lol

My boss sold his last business and made out with millions. He still will never buy new. I'll trust his judgement.

[SW17LS]

Originally Posted by tekphobius

My boss sold his last business and made out with millions. He still will never buy new. I'll trust his judgement.

And none of that would have happened to him if he had bought a new car.

Live a little! I’ve never bought a used car and I’m doing fine.