Would you have felt the same about the lease had the stock market been going down?
TravelforFun
Those are the national offers. They are only a starting point for negotiation, e.g. you never want to pay anything "down" ($0 CCR)bottlecap wrote: ↑Tue Oct 31, 2017 2:53 pm
Here are Edmunds best lease deals of October: https://www.edmunds.com/car-leasing/mon ... deals.html All require some money and fees down and all are at least 22 cents a mile, which is not cheap.
JT
I specifically said all included. So if they charge $5k on top of that, then of course that increases the price a lot. That’s an extra $139/month so almost double.thangngo wrote: ↑Tue Oct 31, 2017 1:20 pmfinite_difference wrote: ↑Mon Oct 30, 2017 9:33 pm If you can lease for $150/month or under (all included), then I would not call it the most expensive. That’s not a bad deal. Never say never.
Can you give an example for $150/month lease all inclusive? Did you factor in first payment? some might charge $3k to $5k on top of the $150/month payment.
Honestly I think the change to self driving will be even more revolutionary than the change from ICE to EV.warner25 wrote: ↑Tue Oct 31, 2017 6:20 am I think it's fascinating that consensus here now is that a major technological revolution will wipe out the value of ICE cars within 5-10 years. We just bought a new ICE that I plan to keep for the next 10-20 years, so that's disconcerting, but I also welcome a shift to all self-driving cars as much as anyone. But 10 years ago seemed like peak oil and the end of gasoline as a reasonable source of energy for a car, and now gas prices are still 1/2 of what they were back then, so we'll see... I'm marking this thread to revisit in 2022.
Not only this, but what about our grid infrastructure? Twice now in the past twelve months, the transformer that serves my neighborhood went up in smoke, causing extended power outages. Most recently it was from hot weather and high power demand due to central A/C usage. What will happen when that kind of power draw happens on a daily basis during overnight hours when people charge their cars at home?Yankuba wrote: ↑Wed Nov 01, 2017 11:10 am Re: the discussion about ICE vs. electric, there is some recent press on the challenges of supplying enough materials for the car batteries:
https://jalopnik.com/we-may-not-have-en ... 1820008337
They don't really care that much about what happens beyond the warranty+CPO warranty period, which is 5 years. They never claim that their cars are very durable. Their marketing message is about performance, handling, and luxury, not durability. Lexus does claim long-term durability, and they do seem to deliver on that, but BMW offers cars that are more fun!investor997 wrote: ↑Wed Nov 01, 2017 12:30 pm BMW in particular never ceases to amaze me in their inability to figure out how to keep a valve cover gasket from leaking oil everywhere.
To me, none of those numbers matter. What does matter is the down payment added to the monthly payments added to the residual. Compare that to what you could buy the car for new (not MSRP) . In some cases, leasing will cost more but not always. Ignore sales tax, documentary fees and registration as those are likely a wash whether you're leasing or buying. However, if you're going to puts lots of miles on a lease, its probably not the best approach.ABS wrote: ↑Tue Oct 31, 2017 9:41 am From a financial perspective leasing NEVER makes sense.
1) Leases are based on projected/estimated miles. If you drive less miles, you do not get credit and the leasing company comes out ahead. If you exceed the miles allowed, you get whacked with extra mileage penalties. Some lessors may cut you some slack but only if they can hook you into another lease.
2) Even if you have minimal scratches or dings at turn in, watch out! The leasing company will try and squeeze what ever they can out of you; they need to maximize profit on the resale of the car.
3) Leases are focused on selling monthly payments; unless you are persistent and dig deep enough the true costs are hidden or obfuscated - cost of the vehicle, interest rate, residual value, penalties.
4) Lease costs are based on acquisition costs, interest rate and residual value. So you, the lessee are paying a premium for the lessor taking a "risk" on the residual value. That risk is for the most part pure baloney. Leasing companies, like insurance companies are in business to minimize risk. Caveat - the government can distort market conditions by offering ridiculous incentives for vehicles like electric cars.
Unless there is a primal or emotional need, own your vehicles till the wheels drop off or there is a safety reason to get another vehicle. Bogleheads' mantra of " costs matter" applies to vehicles as well.
It will be a gradual transition. Supply will be scaled down gradually as demand is decreased.Teague wrote: ↑Wed Nov 01, 2017 1:33 pm Some have stated concerns that we will transition to electric vehicles over the next ten years or so, and therefore the safest move, financially, is to lease, and not get stuck with an internal combustion engine. So I wondered what that transition period might look like.
One thing that occurred to me is that there would be a lot of gasoline no longer being sold. A glut of gasoline if you will, as demand plummets. The oil companies will adjust of course, and they are already doing this, but that will take some time. What will the price of gasoline look like per gallon? $2.00? $1.00? Twenty-five cents? Will there be a year or two when they will pay me, just to haul some of the stuff away?
Have you compare pricing out leasing to say buying and selling a new car every 2-3 years? Leasing isn't the problem. It is driving a new car every 2-3 years.ThePrince wrote: ↑Mon Oct 30, 2017 9:12 pmNever. A car lease is the most expensive form of vehicle ownership.RRAAYY3 wrote: ↑Mon Oct 30, 2017 9:06 pm Need a new car end of December
Love AWD ... but also loving the new Civics. Live in North East, so weather is an issue ...
Are there ever any reasons to lease vs buy? I have the money to buy - just wondering if it’d be better to pay less monthly and invest the difference.
Or do Bogleheads always buy their cars?
Well, they are getting more "car" for the same money. So while you might not have helped them save money, you helped them stretch their dollar, if you could call it that.Slacker wrote: ↑Mon Oct 30, 2017 11:24 pm I have a family member with an irrational phobia of cars that have more than 50,000 miles. They were buying new cars every 3 years as soon as the old car was just about to hit 50,000 and they would sell the car to the dealership as a trade in. I mentioned that they should probably consider a lease...so they leased their current car, but instead of getting the same class of car at a much lower cost they used that opportunity to "upgrade" to luxury class of vehicle since the monthly payments were the same
Oh well, I tried to save them some money considering how they purchase cars.
Maybe a lease never makes sense for this family member of mine.
If you were considering a plug-in hybrid vehicle for your next purchase, a lease may make sense due to rapid changes in technology. If you were getting a regular internal combustion engine vehicle just go with something 2-3 years old.
How is your low cost of fuel in any way related to a lease? Wouldn;t it be the same for a purchased/owned (possibly financed) car?I have friends with V6s who spend close to $150/month in gas alone for less miles traveled. Factor in maintenance and depreciation and I think I'll come out way ahead.
my first fill up was at $0.25 in 1957.Teague wrote: ↑Wed Nov 01, 2017 1:33 pm One thing that occurred to me is that there would be a lot of gasoline no longer being sold. A glut of gasoline if you will, as demand plummets. The oil companies will adjust of course, and they are already doing this, but that will take some time. What will the price of gasoline look like per gallon? $2.00? $1.00? Twenty-five cents? Will there be a year or two when they will pay me, just to haul some of the stuff away?
Me too. I won't believe the EV hype until I start seeing EV full-size trucks rolling off the assembly lines. Here in flyover country, every other vehicle on the road is still a truck, and I see maybe one EV a week on the road here. I actually know the guy driving that EV. His name is Phil.warner25 wrote: ↑Tue Oct 31, 2017 6:20 am I think it's fascinating that consensus here now is that a major technological revolution will wipe out the value of ICE cars within 5-10 years. We just bought a new ICE that I plan to keep for the next 10-20 years, so that's disconcerting, but I also welcome a shift to all self-driving cars as much as anyone. But 10 years ago seemed like peak oil and the end of gasoline as a reasonable source of energy for a car, and now gas prices are still 1/2 of what they were back then, so we'll see... I'm marking this thread to revisit in 2022.
I have a case where it cost me very little to lease, in 2008.RRAAYY3 wrote: ↑Mon Oct 30, 2017 9:06 pm Need a new car end of December
Love AWD ... but also loving the new Civics. Live in North East, so weather is an issue ...
Are there ever any reasons to lease vs buy? I have the money to buy - just wondering if it’d be better to pay less monthly and invest the difference.
Or do Bogleheads always buy their cars?
It's not that simple... Manufacturers (such as BMW) subsidize the residual on the lease in many cases, thus making the terms attractive to the customer. There is something in it for the manufacturers - they don't do it because they are nice. The main benefit they get for these decreased margins is increased volume.
I imagine much of this is kept for "internal use". Maybe someone has direct, inside knowledge.visualguy wrote: ↑Thu Nov 02, 2017 3:36 pmIt's not that simple... Manufacturers (such as BMW) subsidize the residual on the lease in many cases, thus making the terms attractive to the customer. There is something in it for the manufacturers - they don't do it because they are nice. The main benefit they get for these decreased margins is increased volume.
They keep tweaking the lease terms to achieve higher profits by hitting the right trade-off between margins and volume. They use sophisticated modeling to adjust the various lease terms on a regular basis for different models and model years. For customers who lease at the right time, this can be advantageous. For example, BMW lease terms tend to be less good early in the model year, quite good in the middle, and even better toward the end of the model year.
My point was that it sometimes makes sense to lease. In my case, it made sense to lease a hybrid vehicle, as opposed to leasing an ICE vehicle or holding on to my outright-owned vehicle.dm200 wrote: ↑Wed Nov 01, 2017 3:04 pmHow is your low cost of fuel in any way related to a lease? Wouldn;t it be the same for a purchased/owned (possibly financed) car?I have friends with V6s who spend close to $150/month in gas alone for less miles traveled. Factor in maintenance and depreciation and I think I'll come out way ahead.
I agree, they don't do it because they are nice, but they do it because they can. They probably cannot offer the same subsidies on a purchase. As a consumer what the manufacturer gets out of it is irrelevant; you have to decide what works out best for you.visualguy wrote: ↑Thu Nov 02, 2017 3:36 pmIt's not that simple... Manufacturers (such as BMW) subsidize the residual on the lease in many cases, thus making the terms attractive to the customer. There is something in it for the manufacturers - they don't do it because they are nice. The main benefit they get for these decreased margins is increased volume.
They keep tweaking the lease terms to achieve higher profits by hitting the right trade-off between margins and volume. They use sophisticated modeling to adjust the various lease terms on a regular basis for different models and model years. For customers who lease at the right time, this can be advantageous. For example, BMW lease terms tend to be less good early in the model year, quite good in the middle, and even better toward the end of the model year.
I wonder if there is any way for the consumer to find out the net after subsidy of a vehicle in a lease to compare apples to apples?imperio wrote: ↑Fri Nov 03, 2017 4:08 pmI agree, they don't do it because they are nice, but they do it because they can. They probably cannot offer the same subsidies on a purchase. As a consumer what the manufacturer gets out of it is irrelevant; you have to decide what works out best for you.visualguy wrote: ↑Thu Nov 02, 2017 3:36 pmIt's not that simple... Manufacturers (such as BMW) subsidize the residual on the lease in many cases, thus making the terms attractive to the customer. There is something in it for the manufacturers - they don't do it because they are nice. The main benefit they get for these decreased margins is increased volume.
They keep tweaking the lease terms to achieve higher profits by hitting the right trade-off between margins and volume. They use sophisticated modeling to adjust the various lease terms on a regular basis for different models and model years. For customers who lease at the right time, this can be advantageous. For example, BMW lease terms tend to be less good early in the model year, quite good in the middle, and even better toward the end of the model year.
+100!Top99% wrote: ↑Tue Oct 31, 2017 7:17 am People have already covered the lease Vs buy angle so I will address the AWD Vs FWD angle. Unless you need to scale steep snow covered hills on a regular basis FWD + winter tires will be fine. If you Google "winter tires Vs AWD" you will find numerous articles on how winter tires make a huge difference. I realize I live where there is no winter weather now but I did learn to drive in Canada and got by just fine on RWD + winter tires.
To be clear, it’s not about “EV hype”. I don’t think ICE cars will disappear in 3 to 5 years. My point is different. If you think you may want to buy an EV car in a few years (and you need a new car now), consider a lease of a car with good residual value. That lease may give you a valuable option to move into EV when the major car companies start bringing product to market. From personal experience, EVs are awesome. I ain’t ever going back...Rupert wrote: ↑Wed Nov 01, 2017 3:49 pmMe too. I won't believe the EV hype until I start seeing EV full-size trucks rolling off the assembly lines. Here in flyover country, every other vehicle on the road is still a truck, and I see maybe one EV a week on the road here. I actually know the guy driving that EV. His name is Phil.warner25 wrote: ↑Tue Oct 31, 2017 6:20 am I think it's fascinating that consensus here now is that a major technological revolution will wipe out the value of ICE cars within 5-10 years. We just bought a new ICE that I plan to keep for the next 10-20 years, so that's disconcerting, but I also welcome a shift to all self-driving cars as much as anyone. But 10 years ago seemed like peak oil and the end of gasoline as a reasonable source of energy for a car, and now gas prices are still 1/2 of what they were back then, so we'll see... I'm marking this thread to revisit in 2022.
Thought you were a surgeon? How are you able to lease a car and allocate the whole amount towards business use?eye.surgeon wrote: ↑Tue Oct 31, 2017 12:40 pm I'm surprised how little comment there is on a clear advantage for leasing for some people , deducting the lease as a business expense if able. I can and I do. It saves me thousands a year over buying. Often I will buy them at the end of the lease.
That's really funny about the TeslaJack FFR1846 wrote: ↑Tue Oct 31, 2017 7:31 am
Part of the reason that leases are not usually favored here is that it's ok to buy a 3 year old Camry and keep it for 15 years, which a lease would never work out for. Ironically, it seems to also be ok to buy a $125k Tesla because.....well.....gotta keep the coal workers in jobs supplying 1/3 of the power generators in the US.
Having a leased car is a problem if the owner dies or has to give up driving since that does not automatically end the lease.S&L1940 wrote: ↑Wed Nov 01, 2017 12:12 pm How about an area like south Florida with a ton of aging drivers?
Owning a car for 10+ years may be extremely optimistic - forget car longevity, what about driver longevity?
And then there is the driver's ability (meaning mental and physical capability), some of us probably should have been off the road years ago!
Thinking here is a situation where short term, low mileage leases, can make a lot of sense.
And let's hear it for self driving cars - owned or leased - that have automatic turn signals programed in...
I have 6 offices, a surgery center, and take call for multiple hospitals. While it is true that miles driven to and from your primary work are not deductible, miles driven from office to office during the day, which I do every day, and miles driven to hospitals responding to on-call duties that are separate from your primary office responsibilities, are deductible. Therefore a significant part of my lease, but not all of it, is deductible. I do pay taxes on the non-work related miles as it is considered compensation from my practice similar to income.ad2007 wrote: ↑Tue Mar 13, 2018 11:53 amThought you were a surgeon? How are you able to lease a car and allocate the whole amount towards business use?eye.surgeon wrote: ↑Tue Oct 31, 2017 12:40 pm I'm surprised how little comment there is on a clear advantage for leasing for some people , deducting the lease as a business expense if able. I can and I do. It saves me thousands a year over buying. Often I will buy them at the end of the lease.
My accountant told me that since I'm driving the car back and forth from home and offices ect, I have to keep accurate mileage between offices (not home to office or last office to home) and am only allowed to deduct those miles. So the whole lease amount can't be paid by the office.
I was also told I could (since the the owner of the business) make a car lease a benie for my position - but then I still have to pay taxes on the amount the business pays for that lease - as that would fall under my compensation. Too much trouble, so I never bothered.
But I do lease.
As in all things in life never say never. In all financial choices there are things that can and have been mis-priced. This is can be true of leases.
+1Rupert wrote: ↑Wed Nov 01, 2017 3:49 pmMe too. I won't believe the EV hype until I start seeing EV full-size trucks rolling off the assembly lines. Here in flyover country, every other vehicle on the road is still a truck, and I see maybe one EV a week on the road here. I actually know the guy driving that EV. His name is Phil.warner25 wrote: ↑Tue Oct 31, 2017 6:20 am I think it's fascinating that consensus here now is that a major technological revolution will wipe out the value of ICE cars within 5-10 years. We just bought a new ICE that I plan to keep for the next 10-20 years, so that's disconcerting, but I also welcome a shift to all self-driving cars as much as anyone. But 10 years ago seemed like peak oil and the end of gasoline as a reasonable source of energy for a car, and now gas prices are still 1/2 of what they were back then, so we'll see... I'm marking this thread to revisit in 2022.
Single payment leases are not uncommon, and are typically less expensive than normal leases--but more expensive than buying the car outright.Boglegrappler wrote: ↑Tue Mar 13, 2018 2:47 pm It occurs to me that there could be an unfilled niche in the market for people like me. I'd be willing to do a deal where I paid up front (as though I were purchasing the car), but only for the three years. That way I would avoid the charge of renting someone else's capital instead of using my own, and the rest of the terms about mileage and condition could be roughly the same.
Even with mileage well below the average (8000 miles a year), I still had to replace all tires on a 2012 Leaf I leased for 3 years. The state of the roads around here is just terrible and takes a huge toll on tires. Brakes had to be fixed as well, which I consider a design issue with the Leaf.wrongfunds wrote: ↑Tue Mar 13, 2018 3:20 pm Once you reach a point in life where you no longer want to do any unplanned maintenance such as new tires or new brakes or new battery AND your driving mileage has gone down significantly, I can see how somebody would just start doing the leases for the rest of their life. I don't think I will ever reach there myself but I understand perfectly why some of my friends have started leasing their vehicles. Mind you, these are all the guys who like me have kept their vehicles for decade or more in the past and were always purchasing purchasing sensible Japanese cars.
Depends on the car. Most cars include a 3yr/36k mile bumper to bumper warranty. Some cars are 4yrs/48k miles. Thats for repairs.
Yes, but... Generally, leasing is just a form of alternate financing.
No. Leased cars are always new cars and covered by warranties for most major items. You can also add in other maintenance/repair plans to cover the costs of things not covered by the warranty. There are debates on leasing forums whether these are good deals or not -- probably depends on the car, etc. But if you do buy these plans, you know your entire cost of the car up front.