sorry, dacia lease details here

offers.dacia.co.uk/cars/loganmcv

Edited by daveyK_UK on 05/06/2016 at 10:55

Better to consider a four year old Dacia with a maximum of 24,000 miles on the clock for around £6000 max?

His argument is while the deposit on the Logan is £1174, the cost of a decent used Focus/Astra estate is similar if not more (£1200-£1700)

That'll be the initial payment. Calling it a deposit suggests it's returnable at the end of the deal. It's not.

This deal looks good value. www.yes-lease.co.uk/personal-lease-cars/kia/sporta...0

We get asked this question several times daily as a leasing broker.

There are a lot of factors to consider.

If you are comparing an old banger against a new car you are trying to compare the wrong thing. Of course an old banger will be cheaper, you can pick one up at auction with MoT for under £500, run it till it fails its MoT, junk it and get another one.

But, you will be running around in an old banger. If you are happy with this, your work doesn't require you to drive a reliable car / doesn't matter if you're late because you broke down etc then all good go for the banger.

If you are considering a reasonably priced used vehicle, the lines begin to blur as you will then be taking into account depreciation of the vehicle you buy against when you sell it and that broken down over say 3 years will give you a starting 'budget' not taking into account cost of repairs and higher maintenance costs. Plus the risk of something big going pop which may write the vehicle off (e.g. auto gearbox).

I could wax lyrical all day as to why leasing is better than buying but thats not why I'm on this forum. I like to give free helpful advise.

With regards to the 'dreaded hand back' issues. If you drive your car like you don't care (e.g. it will get crunched bashed etc) then perhaps contract hire is not for you, but a PCP may be as you can simply sell at the end and pay the balance off. If you end up in negative equity (unlikely if you set the lease up properly to begin with and havnen't destroyed the car) then it is ultimately your fault.

All leasing companies are bound by the BVRLA Fair Wear & Tear Guidelines. These are reasonable and take into account day-to-day usage of a car over the lifetime of its lease. They will not expect it perfect when it is returned, but equally they wont expect it full of dents either. Anyway any issues can be resolved before you hand the vehicle back by getting them fixed yourself (bit like renting a house really, the landlord will accept the odd mark and stain on the carpet but if you knock the wall through you can expect to fix it or pay).

To try and answer your question directly, is leasing cheaper than buying a low value car... well... No. The lease example you used of £99x48 plus a £1k initial payment will mean that you are paying £5800 over 4 years. You could buy a new to you car for £1000 per year with 12 months MoT and still end up with change, "presuming nothing goes wrong". But... you will be driving around in an old smelly 3rd/4th hand car that will be tired, less efficient and wont necessarily portray the image you want to portray (if you are image conscious in any way). I could built a case quite easily based on fuel ecomony, estimated bills etc but again you are comparing two very different scenarious.

If you want any more info, please feel free to PM me.

Does anyone have any thoughts on his conclusion that leasing is cheaper than buying a low value car?

Yes. I profoundly disagree. We bought a 4yr old Focus auto estate with 29,000m for £7,000 12 yrs ago. The two biggest bills have been a rear wheel bearing and just recently a fuel pump for £250. It has now done 114,000m

Goodness knows how much it would have cost going down the leasing route. Even if we had had to borrow the money, it would still have been cheaper.

According to oil baron Paul Getty, “If it appreciates, buy it. If it depreciates, lease it.”

I don't necessarily subscribe to this statement but it's often quoted and there must be some basis of truth in it somewhere......

Leasing can be cheaper for a low mileage user than buying secondhand, but not when buying a nine year old car.

The most expensive way to buy a car and do low mileage is to buy a five year old car from a dealer for 6 to 8k. All cars are worth almost nothing at ten years old, so all that money will be lost. Add to that that buying a five year old car is always a gamble reliability wise, you'd wonder why anyone buys cars of that age, but that is what most people do.

The best option overall would be to buy a nearly new Dacia for about 8k with cash on a five year bank loan. The bank repayments wouldn't be much higher than the lease cost, and at five years you can sell the car on for a few thousand, or keep the car with no payments due for the next five years or so until the car is only fit for the scrap yard.