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Old 07-25-2008, 01:02 AM   #45
Bill Bumface
My face is a bum!
 
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Screw depreciation, cars aren't investments, they are toys. Get whatever one you liked better. If depreciation mattered you should be buying a 1990 corolla.

Leasing vs. buying completely depends on the rates. I know a very rich guy who needed a truck for his hobby ranch. He could have bought it for cash probably with what he was carrying in his wallet that day. The lease rate was something like 0.9% at the time, and the purchase rate was a little higher. So he leased it, grew his money a whole bunch in the meantime, and bought it out when he was done. Even if he was making a meager 5% on his investments he saved a lot of money over buying it straight up or financing it.

I leased my first couple cars for this reason, plus they were cars where I knew there was a good chance of brutal depreciation, and leases also protect you from this, the biggest advantage of leasing IMO. If the residual is $10,000 and the car is worth $13,000 at the end of your lease, great, buy it out, sell it, pocket $3000. If the car is worth $7000, sweet, give it back at the end of the lease and the dealer eats $3000.

My last car I decided I would buy one a couple years old and get a car I could never afford new. The finance division of the manufacturer just started offering 1.9% financing which was a really good deal, and in the past my model had always been an exception for the financing deals and was more like 7 or 8%, so it made no sense to lease when the rate would have been much higher, so I financed it over the longest term they offered for 0 down, as I can easily make more than 1.9% off my money while it's still in my grubby hands.

In conclusion:

ASTRA!!
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