The big Clash style question: Should I lease or should I buy now?
At Summit Drive, we’re biased. It’s ‘Click, Lease, Go!’ for a reason. However, we think we can remain impartial for an article. We’re professionals, after all.
What’s the Difference Between Leasing and Buying a Car?
Let’s start with the outlining basics shall we?
- Leasing: Think of it as a long-term rental. You pay monthly to drive a brand-new car for a few years and hand it back when the lease ends. You don’t own it, so you don’t have to sell it.
- Buying: You own the car outright after purchase or once your loan is paid off. You can keep it as long as you like and sell it whenever you fancy.
Why Choose Leasing?
Below are the main reasons people love to lease and bypass buying.
1. Less Cash Upfront
Cars fresh off the forecourt command a big chunk of cash (or a large loan) to prise it out of a dealer’s claws. Whereas, with leasing, your initial payment can be as little as 1 months’ worth of your lease fee.
2. New Car Feels
Leasing gets you access to the latest cars on the market. There’s no need to settle for outdated vehicles or second hand risks. Instead, you get all the benefits of a brand-new car.
3. Fixed Monthly Payments
You’ll feel more relaxed knowing that your monthly costs are fixed and include road tax as well as breakdown cover. No unexpected costs
4. No Depreciation, No Worries
We all know that new cars lose value fast. They can drop by over 50% in the first three years, leaving you with anything but an asset. Yet, with leasing, you’re only paying for the car’s depreciation during your lease term - not the full value.
5. Easy Upgrades
When your lease is nearing an end, you can start eyeing up your next new car, safe in the knowledge that you don’t have to sell or trade in your old one to get it.
Why Choose Buying?
Ownership may be your thing. Fair play. Here’s why some drivers want to own their car outright:
1. It’s All Yours
Once you’ve paid for it, the car is yours. You can modify it, keep it forever, or flog it whenever you fancy.
2. No Limits
Leasing agreements often have limits on mileage, contract length and initial payments. This isn’t ideal If you need a car for specific purposes beyond what you can get on a lease deal.
3. Penny’s in the Pot
If you keep your car for many years, buying can be more cost-effective. After you’ve paid what you owe, you’ll have years of driving without monthly payments. This cash could be saved instead.