This is post three of my search for a new vehicle. Before I continue, I need to exclaim that I FINALLY have a job offer on the table for me and this makes my search a little less stressful (both mentally and financially).
Now, to the actual content:
I lease a Ford Fusion (last payment happened today!) and it served me well but I'm ready to move on. The reason I went with a lease two years ago was that I was pouring money into another vehicle and figured "I could toss money into a brand new car instead!"
Leases present car shoppers with the opportunity to get into a brand new vehicle for less per month than if they were to buy the same vehicle. Why is this? Lessees pay for depreciation of the vehicle only. I was told that when I return my car the value was guaranteed to be at least a certain amount...and it seems that that dictated my monthly payments. At the time, I was naive and excited and fresh out of school so I probably (read as "did") got taken advantage of a bit. But hey, no hard feelings. Things worked out pretty well.
The problem is, even though I leased before I do not know if I would want to do it again. Sure, payments are less per month but when it comes down to it, after two years I am right back where I started. Repeating this process for 5-10 years makes leasing actually more expensive than owning a car for that period of time. The reasoning I have behind this is that the start of every lease requires a down payment (something that happens once when you buy) and the monthly payments for buying eventually end.
In my research I found an interesting article summarizing a study by Edmunds (and a similar article from Edmunds) that compares leasing to buying.
Over the long term, leasing IS more expensive. This makes sense to me, as previously mentioned.
But the problem is now...what car will I be happy with for 5-10 years? I can barely plan for something a month from now, let alone 5 years from now. I am confident that if I find the right car I can love it for 5 years but what will be that right car? Who knows?
Any thoughts on leasing vs buying? What would YOU be happy with for 5-10 years if you were in my situation (typical recent grad with soon to be full time job)?