I wouldn't say that is completely true.

eg: 100 k vehicle, 60 k residual value

You are 'paying off' the 40 k depreciation, over the term of the lease. That is just as you stated.

However, you are also paying the opportunity cost, or carrying cost, which is the financing on the total (declining) value, over the lease term.

If two cars have the same price, and one has a higher residual value, then yes, it would be cheaper to lease than the other car (all other things being equal).

However, expensive cars have higher carrying costs, so more expensive (high end) cars shouldn't be cheaper to lease just because they may have higher residual values than less high end cars. Add in the risk factor due to the volatility in the resale market, and more expensive cars will not be great deals just because of presumed good residuals, you need to look at the total equation.

That indeed is a heck of a deal on an '06 X5 4.4i. $23,900 for CPO is excellent.

3.0's are retailing for mid $20's to low $30's, 4.4 are low to mid $30's asking price. Last time my dealer checked the auctions for me, (it's been a couple months), the V8 '06 models were going for more than low 20's wholesale....and CPO'ing it adds another maybe $1500 or $2000 on top of wholesale value.

The dealers in the DC and Baltimore area won't come close to an '06 CPO unit for low 20's.

I shopped around for quite some time and honestly spents hours online and calling different dealerships in the entire tri-state area. Even drove to Jersey a couple times from Long Island to see a few of them. Finally found one pop up on bmwusa.com as a CPO and it had a low asking price. Figured something had to be wrong with it so I immediately called the dealer and asked about the truck and it was available. He said to me "how did you even know we had that vehicle? We just got it in off a lease return yesterday and the car hasn't even been prepped yet?". Told him I found it on bmwusa.com's website and he was pretty shocked. He said he didn't even know they had the car yet. I asked if I could drive there that evening to see the vehicle and he said that the truck hasn't been cleaned yet or anything and I said perfect. That's how I wanna see it before anything's cleaned or fixed to get an idea of perhaps how the previous owner took care of it.

I got to the dealership and the truck was pretty dirty on the outside and a little dirty on the inside but not too bad. The only damage to the truck was the front and rear bumper which I pointed out and they agreed to respray them for me. I test drove it and it rode awesome! One of the best ones I test drove. The salesman told me that the car has a clean title and should pass BMW Certified pre-owned requirements and he will let me know after all is completed. Took them about a week to do the maintenance, CPO inspection and approval, paint the bumpers and detail the truck but when I went there to pick it up it looked like brand new and I was happy. I knew I struck gold with this truck and still couldn't figure out why it was so cheap but the salesman told me that the guy had a ridiculous 2-year lease and paid for more mileage than he needed. He showed me the previous owner information on BMW's system and it belonged to a doctor from Bedford, NY. The history in the navigation system showed all locations in Westchester NY and New Jersey which leads me to believe that the truck has mostly highway miles. Anyways, that was my experience, sorry for the long post and just keep looking! I seriously looked at about 30 different X5's! It was pretty exhausting :D

I suppose i should have included your entire comment which was

"I'm not familiar with leasing ins and outs but I thought leasing is mostly for people who like to have newer rides and don't want to worry about ownership"..

Having said that; IMO lease or buy (within the 4 year time period that one owns or leases a new vehicle) there is no worry about ownership because of the warranty.

Yes you are correct. I believe that is where the term "money factor" is thrown around when leasing. It is just the financing costs as you stated. But isn't BMW currently offering some really low rates? I would think that should apply to leases as well. It all depends on the leasing company. Does BMW do their own leases? When I worked for Honda, we used different leasing company's, just as people use different banks for financing.