Quote:
Originally Posted by jeep
I based my calculations on the following:
12yrs back interest rates were higher and they have been going down over the years but at the same time BMW has been jacking up car prices faster than inflation. Granted the features and performance has also improved.
To buy an X5 today assuming a price of 58K with 0down and .9% financing would work out to about $1000/month whereas lease for the same car would cost $650/month. Over a 10yr period, assuming lease payments remain the same, the cost would be 78000, the difference in cost is $18K. Now if you include the maintenance cost of 10K over the 10yr life of car which is conservative for BMWs IMHO (0 maintenance cost with lease). You do have residual value of the car which I am guessing will not be more than 10K at trade in for a 10yr old X5 which cancels out the maintenance, so essentially it works out to 18K over a 10yr period or 1800/yr to drive a new X5 every 3yrs. (The 6K diff. I quoted earlier was based on 3 series nos.), no maintenance hassles and unexpected expenses plus no headache of trying to sell the car (I went through an unpleasant experience where I got 3K less than what I expected for the car and had to deal with all kinds of low ballers).
Now these are very conservative numbers but still looking at this I feel leasing is a very compelling option.
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According to BMWUSA.com a MSRP of $58K with $4K down on 36 months 15K miles a year is $760. So, you have to put $4K down three times totalling $12K vs $0 down on a finance over those 10 years. And if you want an example of 10 year old BMW I am one of them--I have an '01 e53 that I've had since new that most people think is only a few years old. I realize everyone doesn't drive their cars 10 years. Even at year 6 look at the numbers--- $60K for finance vs. $54K for a lease. But you just spent $8K on 2 down payments on the 2 leases so now you are at $62K for your cost on the lease. And you also have no equity on a lease vs. when you finance you probably can sell it for $30K at year 6--so effectively that $60K car only cost $30K when financing. Plus you forgot to mention you are paying twice the sales tax on 2 leases vs. one on the finance--that's a lot of money. And you also just put $12K back in your account on year 5-6 on the finance having no payment. But I understand people choose either or for their own reasons. Like I said lease payments 4-5 years ago were much cheaper than to finance--but that has changed IMO.