Lease vs Purchase

[grover432]

With the current reduced residuals on 3 year leases (in Canada anyway), how many of you are purchasing vs leasing (or vice versa).

I had considered purchasing a diesel X5 outright, but am wondering whether I might be smart to lease while we watch where the value of SUV/SAV's are going. If the vehicle is reliable, I'd drive it for 5 - 6 years.

It would be less expensive to purchase outright in that case, but if diesel and gas continue to climb like they did last summer, I might end up owning a paperweight when it comes to trade in time as people holding large thirsty SUV's/Trucks are finding now.

Any thoughts?

[BGM]

Someone did poll a month or 2 ago about how many on here finance vs. lease. It seemed most financed but obviously this is just a portion of owners (and most who lease aren't going to be on here as much as someone who finances). I think the whole gas price thing a few months ago was blown out of proportion as evident in gas prices falling now. I don't think we will see $4.50 for premium anytime soon but I also don't think we will see sub-$2.00 for premium anytime soon. To me, get the diesel if you are really into the conservation of energy, better emissions, etc. It's a crap shoot on diesel prices across the country and where they will go. My $.02.

[golfer4life]

This is a question that has been asked a few times but you will get different answers.

The bottom line is, leasing is not for everybody.

I lease my cars because I want a brand new car, new warranty every 3 years. When I don't have to worry about un expected repair expense and warranty issues, it means the whole world to me.

Leasing is also good for people who has businesses, as in my case also.

Lease = you only pay for the use of the car for the life of the lease. Low down, low payments, limited miles. etc.

Buying = you buy the car and take on the depreciation as soon as you drive it off the lot. High down, high monthly, unlimited miles. etc. You own the car after you financed it, or if you pay in cash, it's yours. But after the warranty expires, all the problem are yours also.

You have to know what you want, how long are you planning on keeping the vehicle and such. It all comes down to personal needs and preferences

[Jasx5]

I agreed with golfer.

One more consideration is the interest rate (or money factor) betwwn lease or buying (financing).

I had asked myself too many times whether I should lease or buy my 08 E70 3.0, and I had decided to lease it because 1) I don't know I will keep the car for more than 3 or 4 years and I don't have to pay the full $4.5K sales tax up front, 2) I don't have to worry about depreciation or any minor scratches, and, 3) the interest rate is not hugh different compare to financing. Mine was 3% (.00125 MF) for leasing vs 0.9% financing. I will decide whether to keep the car 3 years later, or get a CPO for a better price and with extended warranty.

[Texas5]

The biggest advantage of leasing is that the residual values are subsidized (although not as much as in the past) by BMWFS. The interest rate is often lower as well. If you know you'll keep the car 3 years or less, leasing is the way to go. Notice that BMWFS residual percentages go way down after 36 months - I guess they don't want lease returns that are too old.