Personal leasing depreciation query

6
Found 27th Feb
Hi guys, I'm searching around for my first lease deal. Thanks to the forum I'd been using the 25% of RRP 'yardstick', however that seems to be for around 8k miles pa on a 2 year deal. Ideally, I'd be looking for 12k. Am I still trying to find something under 25% or do I need to adjust my expectations ?
Many thanks.
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I wouldn't waste my money leasing a car.
Buy a really good condition, well looked after second hand car for a couple of £k's.
I have 2 cars, one is a 25 year old volvo and cost me £250, the other a toyota mr2 convertible that cost £1800.
I use 10k miles and 25% of RRP as my yardstick but i wouldnt go above 25-27% as thats my top end for example i ordered an Audi A4 in November and that came in at around 19% if you see something that is amazing you just have to jump straight in.
I was using the Seat Arona (wife likes it) as a 'test' but can't find anything less than 28%....I suppose the question then arises, if that is the cheapest available, is it a good deal ?
I am not fussy about the car, looking for something 'family' sized for a real monthly cost of around 200 notes
It's still a good deal if you like the car and the cost of leasing is less than the cost of PCP or outright purchase over the same period. Using % of list price is only really a guide, you don't need to follow it religiously. If you look at the online broker sites such as Drive The Deal or Orangewheels, you'll get an idea of how much discount is available on buying new. You can then look at sites such as Autotrader to get a feel for what the car might be worth at 24 / 36 months etc.

You also should factor in that increasing your annual mileage will increase your monthly payment in the same way that it would increase depreciation on a car you owned, so you need to be realistic about this and adjust your working %age upwards. Mine is working out at 32%, but that's for 15k miles p.a. on a diesel car. As we all know residual values on diesel cars are a bit uncertain at the moment, so leasing can still make sense even at higher %ages as you will have the cost certainty you wouldn't get if you 'bought' the car via other means. If I'd bought my car i'd be looking at 'losing' around 51% of its list price over the same term. So even though my %age looks high, i'm still doing OK. Sure I could have got a 15% discount buying outright, or leased or bought a cheaper car, but I have what i have as it was the cheapest way of getting the car I wanted.

Remember, leasing is inflexible. Two or three years is a long time to be stuck with a car you hate that you only chose just "because it was cheap."
Thanks mate, that confirms what I suspected. Maybe 28% on the Arona at 12k miles is ok (as an example) given I can't find it any cheaper despite spending hours searching.
I'd buy second hand too. It's insane leasing.
The initial payment can buy a car.
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