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Doesn't Anyone Buy Anymore?

187K views 3K replies 227 participants last post by  alex2364 
#1 ·
I became a member of Bimmerfest a little while ago - I'll probably wind up buying a 328 with European Delivery (just waiting to test drive and see the car in person). But the point I want to make is that it seems as though more people lease this car rather than buy. I realize there are business reasons to lease (tax write-off) and that those that don't keep their car longer than three/four years that leasing might be the way to go. However, I plan to keep the car at least six/eight years - as a long-time car buyer I have always done this on the basis that a car depreciates immensely the first few years and then slows down - meaning that once you get past year three the car is less expensive unless the manufacturer is not reliable and various problems pop up in the later years (hopefully, this will not be the case with the 328). Anyway, just wanted to see if there was something that I am not aware of by buying instead of leasing (while I had planned to buy with cash - getting a 1.99 or even 2.99 loan might change my mind - I don't like to have debt).
 
#67 ·
IMO, if you are comfortable owning a car for 6-10 years, and have a reserve of cash for repairs if needed, then buy. If you like new cars, or can work a payment into your budget but have no room for surprises, then lease. And, if when the lease is up, costs went up too much, lease a cheaper car.
 
#69 ·
One other California anomaly:

In most states you get a tax credit on the value of your trade in. In California, you don't.

So if you trade in your $40,000 (residual value) car when you buy your next one, California considers that the same as paying the dealer an additonal $40,000 cash. I've heard that this is only the case in three states, while in the other 47 you would deduct the $40k trade-in from the cost of your next car and only pay tax on the difference. In CA, you pay full tax on this car, full tax on the next car, full tax on every car.

With leasing, you genuinely avoid paying tax beyond the amount your car has depreciated (aprox $3,500 savings in this example).

This (along with lower payments, the fear all the cameras/sensors/robots in my loaded 550 will become expensive to maintain in a few years, and BMW's tendency to charge little or nothing for minor damage upon lease return) convinced me to lease for the first time in my 40 years.

*Please, any Calif. tax experts, correct me if I've got anything wrong here.
 
#85 ·
Right now BMW is offering 0.9% financing. That is as near to free money as you'll get. At that price I'd rather keep my $40-50k liquid for more useful purposes like buying all of the awesome apple stock TSoc is hyping in another thread.
 
#86 ·
For people with A+ pristine credit, yes. Personally I was in the position that it's taken me quite a while to recover from the beating my credit took thanks to my ex wife. As a result, the absolute best interest rate I could get on my new car was something like 4.5%, and that was last September. In the end, I ended up with a much lower effective interest rate on leasing.

At the end of the day, leasing appeals to some people. Like me for example; I have always avoided leasing in the past because on average I do about 20K miles per year. However, that has been offset in recent years by the fact that I ride a motorcycle during the spring/summer/fall. Now that I put about 10K miles per year on my bike I can happily lease (though I picked a 15K per year lease) and not stress too much about excessive mileage.

Also, as I said in my post above I have a tendency to trade out cars often. I'm just not the type to hold onto a car for 10 years and quite frankly the work required to fix cars these days is just making it not worth it.

Speaking of which that's another thing I factored in. Looking at my previous cars, I was able to work on them because they were relatively simple. My Subaru SVX was one of the easiest cars in the world to work on and thus I did most of the work myself and managed to keep it running for many years. However, once I started buying cars built after about 2004 I started running into problems. The level of complexity and electronics running these things got more and more difficult to work with, particularly without specialized electronic tools. Particularly once you get into a BMW it gets ridiculous in that you basically can't do a damned thing to your car without having to get into the computer with some specialized computer toolkit and reset or change something. To me that took me beyond the "I don't want to own a Bimmer out of warranty" to the point of saying "I don't want to own a Bimmer... but I'd like to drive one."

Once I factored in the costs of maintenance (including the cost for my time... which yes I can assign a value to since I am partly self employed) and repairs, the hassle of having to find a buyer for an owned car or take a bath on a trade-in every few years, not to mention that I would prefer to have cash-on-hand in the event my job suddenly went south... yeah, I found leasing VERY attractive.

I also made the point above that I could've purchased a 128i in cold hard cash... a damned nice little car that would've been a blast to own and mod the hell out of. However, I still have that cash in the bank for a rainy day and get to drive a 135i every day that the weather won't let me ride my bike. Yes, it increases my monthly cost of living by the amount of a car payment... but to be honest I'd rather do that than have a car in my garage that's I paid ~$30K for and is now worth $25K just by driving it off the lot and having to direct my "car payment" money into my savings account to recoup the cash I just spent on the car. In this economy not having a cash base for at least a few months of living expenses just seems stupid.
 
#96 ·
Buddy of mine works for a Financial Services company, he gets new cars every 8 to 10 months. Doesn't matter if it's a lease or a buy, he gets the new dealer to "buy him out" of his old car and keeps his payment the same or makes it smaller. When you talk to dealers daily he says you can get some amazing deals.
 
#150 ·
Lucky you on the Audi S6, we don't see them till end of year.
 
#114 · (Edited)
go with the lease if:

You drive less than 12,000 miles per year (which i do)
usually like a new car every 3 years (yeap thats me)
don't like to deal with selling a used car (who has time for that?)

the other advantages as people have said is you get to drive your leased car and if its a lemon or gets in an accident you can turn it in at the end of the lease no questions asked. Yea wear and tear can also set you back but I don't think anyone in here would not take care of their Bimmers.

In addition don't forget maintenance costs after the 4 years/50,000 miles. My 2008 X5 had an electrical issue, they had to essentially change computer, wiring etc to fix it. Over 4,500 dollars repair, cost to me zero under warranty. Imagine if you don't have extended warranty on your car.
 
#115 ·
go with the lease if:

You drive less than 12,000 miles per year (which i do)
usually like a new car every 3 years (yeap thats me)
don't like to deal with selling a used car (who has time for that?)

the other advantages as people have said is you get to drive your leased car and if its a lemon or gets in an accident you can turn it in at the end of the lease no questions asked. Yea wear and tear can also set you back but I don't think anyone in here would not take care of their Bimmers.

In addition don't forget maintenance costs after the 4 years/50,000 miles. My 2008 X5 had an electrical issue, they had to essentially change computer, wiring etc to fix it. Over 4,500 dollars repair, cost to me zero under warranty. Imagine if you don't have extended warranty on your car.
Just when you think that the thread is finished - they drag me back in!

Don't forget perpetual lease payments!
 
#116 · (Edited)
hahahaha. Sorry man I am catching up on my Bimmerfest reading.

yea perpetual lease payments is correct but in this forum to you see many people driving their cars for more than 5 years? I don't, unless its hooked up aftermarket wise. If i wanted a 5 or more year old BMW i can get one on the used market, for a decent price.

let me also add considering what a family Verizon or AT&T cell phone plan costs these days, plus your Netfix account, plus your FIOS/cable, you put all that together and you can be driving a nice BMW, new every 3 years....LOL And heck if I put what ballet classes for my two girls cost me per year I am up to driving a brand new 911 S every 3 years with spare change....Ahhh...
 
#117 · (Edited)
Even for people who plan to keep a car for a long time, it's still cost beneficial to lease. Here's why:

- Each model gets a facelift every 6 years. Other than exterior re-design, you get outdated by the new technologies and interior upgrades.
- It gets more challenging to keep the interior (lether seats, plastic parts, etc) clean after 3-4 years.
- Yes, you don't have driving mileage limitation on financed cars, but you still need to keep it low for warranty (4 yrs/50k miles).
- Additional cost to purchase extended warranty after 4 yrs/50k miles.
- Resale value gets affected by any re-paint jobs unless you can keep a car for 8+ years without any scratches or accidents.
- The total cost (with extended warranty) to keep a car for 9 years is probably close enough to that from leasing 3 cars in 9 years (based on cars at 50k-60k MSRP).
- MOST IMPORTANT: Life is short, drive as many cars as possible if financially allowed.
 
#120 ·
- MOST IMPORTANT: Life is short, drive as many cars as possible if financially allowed.
I would say that is the LEAST important. There is no amount of excess that can satisfy a bottomless desire. Otherwise one can make the same argument for anything -- eat as much food as you can, live in as many places as you can, wear as many different clothes as you can, date as many partners as you can...the list is endless.
 
#119 ·
It really comes down to personal preference. I personally like to buy my cars. I have never traded in a car in under 4 years. The average is 6-7 years. I dont need a new car every 3 years. I realize with my bmw, keeping it much out of waranty is a risk. I probably wont keep it past the 5 year loan period. I like to drive and i drive a lot. I wouldnt want to keep my mileage in check. Cars cost a lot of money. They depreciate rapidly and the repair bills are high. I feel if you are going to buy or lease a new car, do a pro/con list and know what you are getting into. For me, i budget for repairs and expect them, so it doesnt bother me. In the end, i decide whether its time to get a new car.

Sorry for the lack of proper punctuation and the occasional spelling error. Im typing on my phone without an app.
 
#123 · (Edited)
Real life example.

I went to Carmax today for no hassle vehicle appraise. It took about 20 minutes, and my 335d got an excellent bill of health. Long story short, the difference between my purchase price & Carmax buyback amount to $7,300 .

I have tier 1 credit & I don't lease vehicle. Base on my current situation, how is it possible for me to drive 335d fo 20 months without milage restriction, without worry about lease return conditions and only pay total out-of-pocket $7,300.xx ?

In layman's terms, my monthly cost = $7,300 / 20 months = $365.00 / month

p/s In addition, I also claim the $900 Federal Tax Credit for FY 2010.

:dunno:
 
#124 · (Edited)
I went to Carmax today for no hassle vehicle appraise. It took about 20 minutes, and my 335d got an excellent bill of health. Long story short, the difference between my purchase price & Carmax buyback amount to $7,300 .

I have tier 1 credit & I don't lease vehicle. Base on my current situation, how is it possible for me to drive 335d fo 20 months without milage restriction, without worry about lease return conditions and only pay total out-of-pocket $7,300.xx ?

In layman's terms, my monthly cost = $7,300 / 20 months = $365.00 / month

p/s In addition, I also claim the $900 Federal Tax Credit for FY 2010.

:dunno:
The person who leased could have done the same or better. My brother got back $10k on his 911 about 4 years ago even though he leased and it all depends on the desirability of the car. You could never do that with a 750i or or 750IAH. I am also certain that you car was a low mileage car, which means that you did not use it much.
 
#126 · (Edited)
Hi all,
New to the forums and had some questions on purchasing a brand new 2012 bmw 328i.

some background info: I'm from canada and already have fully payed off my 2007 acura csx.

I'm still up in the air on if I should be financing vs leasing. One thing I havn't seen anyone talk about is this owner's choice financing.

OwnersChoice- A great alternative to Standard Financing. Reduce your payments by deferring a flexible balloon amount - due at the end of your term

The dealer was basically saying this was just another way of reducing your payments with 5k down its going to cost me about $733/month over 4 years. Do you guys think this is a good idea to go with? basically he said at the end of the 4th year you can either pay the balloon amount or refinance it OR you can use it as a trade-in for another bmw after 4 years and that it would be worth the balloon amount (on the payment calculator it shows as $20,540) to me this sounds like the best of both works im still building some equity on this vehicle and at the same time putting in 20k+ downpayment on a new car would help keep those monthly payments down(I still think I prefer to get a new car every 4-5 years). There has to be some sort of catch or something I'm missing so hopefully someone can shed some light on this. I was also planning to trade in my acura when buying this new bmw so that should lower my monthly payments as well.
 
#127 ·
Your gonna have to run some numbers...if you are planning on turning it in in 4 years, might as well get a lease, put 2K down and prob have a monthly payment cheaper than $700

Also, i had no clue them made a civic/acura...thats pretty cool. What kind of engine does that thing have?
 
#135 ·
Has anyone thought about purchasing F30 versus leasing? Since this is a fairly new model & I don't think a significant amount of used F30 will be available until 2015 (3 year old lease return), hence the depreciation won't be too bad.

I posted earlier how my 335d purchase equate to $365 monthly cost = $7,300 / 20 months. I think it might have to do with BMW releasing it only in 2009 & there just aren't that many oil burners available for sales. If you have tier 1 credit & you have the capability to make additional monthly payment (apply to principal), then this shall be the route.
 
#137 ·
I would buy instead of lease, I never could work out the benefit of leasing? Where will you take delivery, I have stayed at the movenpick hotel in munich near the airport, and there is a BMW delivery point right next door!
 
#141 ·
I have been analyzing the lease vs own argument for a year. I 'bought' my last 325cic 04 convertible (USED) with 18k miles from private owner. I then sold it at 65k miles few years later. The amount of money I lost in depreciation, I could have added a little more money and leased a NEW coupe. But if I had kept it and drove it till 120k + miles, it would have been the most bang for my buck.

If you want to make the MOST of your money and really stretch it, get the LEAST expensive car, try to finance it as low as 2% from credit union, and plan to drive it for 7 + years and to 100k miles. Heck if your car is running with no problems, you can then do a DINAN mod down the road, even track it and continue to keep as long as it lasts.

Lease is a great win win option, ONLY and IF the lease terms are 'FINANCIALLY SOUND' meaning it makes sense. What do I mean you ask ? Say a F30 328i customer configured costs 36k. Now your dealer is telling you that you can give 3k down, with $600 lease for 15k miles for 3 years. You would pay 21k total in 3 years, and won't have a car at the end. Whereas for 15k + interest% more you could have owned the car. Also would your car depreciate 21k in 3 years ? I don't thinks so.

Now if the same dealer offered you a lease payment of $400 with 3k down. It would amount to 17,400. Would your 35k car depreciate $17,400 with 45k miles in 3 years if you owned the car ? Chances are yes. So even if you had bought it, you would be out the same amount of $ if you decided to sell it 36th month.

Reality is that most likely after 3 - 4 years of driving the same car you will have an itch to get another one. If you get a low enough lease, where it almost equates to actual depreciation of your car had you owned it, it would be a great option, since if you decide to keep it, you can finance your residual. You will have low payments all along, and you will stretch your $.

My conclusion for me, get the lowest lease possible, which is why I am doing ED with 15k miles per year. At the end of the lease I will re evaluate my financial situation, I may just finance my residual or get a different car.
 
#144 ·
I buy cars simply because I don't want a car for exactly 1095 days. I may want it for 1200 or 600 or 1500 days. I want a new car when I see it, not when some contract is up. Otherwise you might end up driving the 2nd best car on the road. That's why half of this forum still has 335i and the other half was able to get an S4.
 
#149 ·
I think car manufacturers incentivize shorter leases for several reasons: 1) the lease residual is easier to predict on earlier lease returns (and are therefore subject to less risk of uncertainty), 2) it helps the dealers' used car divisions by giving them more newer cars to sell, and 3) it reduces the average age of the leasing fleet.

 
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