Good deal or not ?

Hintza

I will defer to Adrain on whether for an Astra this is a good deal or not.

But why not look around at other cars? The reason I say this is because dividing the monthly figure into the purchase price (first example ) that = 65. To me if the figure is not at least over 70 and thed closr you get to 100 the better.

Now I am not sure if this is as valid for smaller cars but it is worth looking into.

For lease I alwayds feel look for the deal and not the car. It is all very well wanting a particular car but at the end of the day there is not a huge difference especially when you don';t have to worry about depreciation etc.

Othewr point to remember is the hire company picks up the tab for the VED.

AdrianHi

Hintza wrote: »

For lease I alwayds feel look for the deal and not the car. It is all very well wanting a particular car but at the end of the day there is not a huge difference especially when you don';t have to worry about depreciation etc.

Othewr point to remember is the hire company picks up the tab for the VED.

I'd agree with that and What Car has a tool for looking up what cars are available for lease in a particular price range.
http://www.whatcar.co.uk/contract-hire-results.aspx?pg=2&RT_ID=644
The "Running Costs" item on cars is also where you can find figures for residual value of cars at 1, 2 and 3 years old, so you can do them sums for each potential car and see which is best for that particular car, buying or leasing.

zermattbusby

Hintza wrote: »

I will defer to Adrain on whether for an Astra this is a good deal or not.

But why not look around at other cars? The reason I say this is because dividing the monthly figure into the purchase price (first example ) that = 65. To me if the figure is not at least over 70 and thed closr you get to 100 the better.

Now I am not sure if this is as valid for smaller cars but it is worth looking into.

For lease I alwayds feel look for the deal and not the car. It is all very well wanting a particular car but at the end of the day there is not a huge difference especially when you don';t have to worry about depreciation etc.

Othewr point to remember is the hire company picks up the tab for the VED.

When applying the 70 rule is it not minus the VAT ?

ie :- £173.90 less VAT = £147.75

£11400.00 divided by £147.75 = 77.15

Hintza

zermattbusby wrote: »

When applying the 70 rule is it not minus the VAT ?

ie :- £173.90 less VAT = £147.75

£11400.00 divided by £147.75 = 77.15

Yes that is probably a better rule.

However on saying that I have just looked back at the figure I had.

My current car is Grand Cherokee is 87.2 (ex VAT) or 72.6 (inc VAT). My old Chrysler 300 was over 90 (but I got stung on excess mileage on that one).

The MIL Quashquai comes out at 62 (inc VAT) and that was very marginal but she wanted hassle free motoring and a new car every few years. The problem with the Quashquai was the dealers close to me were not for haggling much and to be honest just annoyed me with quotes like:-

"We don't use an APR figure" (Arnold Clark Phoenix)

I went back to them and told them the deal I wanted but they were about £1,000 out.

I tend to use the Which Car Target price but on certain cars you can even get a fair bit off that whilst on nwere more popular cars you might struggle a bit.

AdrianHi

Interesting idea the 70 rule, but isn't it just simpler to compare the total cost to you of the two options over the period you expect to use the car and pick the cheapest or if it is near even lease since it's a much easier cash flow situation?

Remember when looking at the purchasing route to include what it costs you to have cash sunk into the car (e.g. lost interest on savings) which can be quite significant and push it in favour of a lease.

Buying an up to 12 month old old Astra and selling it just before 36 months old and warranty expiry surely achieves the same no hassle motoring goal and is significantly cheaper. An Astra looses a big chunk inside year one and then looses relatively little in years 2 and 3. I picked some figures for someone else on a basic 1.4 Astra and if memory serves it goes something like
year 1 approx. 5500
year 2 approx. 900
year 3 approx 700
Where a VW Golf goes something like 3800, 1200, 1000. A Golf is quite pricey as a lease and is better as a buy and sell - cheaper than buying and selling a new Astra inside 2 years (subject to getting a big enough discount on the Astra).

Hintza

You are without doubt correct Adrian.

But for those wanting a new car is is a quick guide to whether a lease is worth it or not. If it is +/- 70 then yhou probably have to delve deeper into the figures to get the best deal whether that be buying or leasing.

Having driven bangers for the last 20 years I'm finding having new cars again a bit of a novelty (which I am sure will wear off in a few years time )

The other thing is the second hand car market is in such flux just now and driving a Gran Cherokee which will no doubt drop like a stone in value I really don't have a care in the world (except of course for the extra £1,000 per annum I now need to find to fill the damned thing)

The last time I did a big excercise on car buying 10 years ago I aslo came to the conclusion you bought around a year old or alternatively you bought a banger and ran into the ground and I don't think anything has changed.

PhilL_3

Leasing would probably be best for you if you are going to keep to your contracted mileage and you want to replace after 2 years.

Personally the 1.6 would be a better bet but that comes down to personal choice.

AdrianHi

Hintza wrote: »

The last time I did a big excercise on car buying 10 years ago I aslo came to the conclusion you bought around a year old or alternatively you bought a banger and ran into the ground and I don't think anything has changed.

I've been crunching numbers on this point for a wide variety of different cars the last few months and I think this is mostly still the case. Get a car that holds it's value well (BMW, Audi etc.) and buying at the 3 to 6 months age 20%+ off list price and keeping to near warranty expiry is the second cheapest way to have the use of the car on a monthly basis. It only gets cheaper than that at around 6 or 7 years old when depreciation slows down a lot. Car's that don't hold value so well and it's worth waiting a year until they have dropped more (e.g. Astra) and cars like the Mini hold their value so well you either buy them brand new or 6 or 7 years old - you don't get much discount for buying 3 to 6 months old on these cars and if you divide your depreciation losses by the number of month remaining until warranty expiry the monthly figure is higher than if you bought brand new.

The only reason's I might keep my BMW 3 series past 36 months old is if the used car market has depressed so much it does has not held getting close to 50% of it's original value or I've decided to keep it long enough to get the benefit of the cheaper years from 6/7 onwards, where I will have an older car that I know the history of and I know has been cared for properly.

If you are clever about when you buy and sell you can have an Audi A3 or BMW 1 series for Astra money - looking at it as an average monthly expense and providing you have the means to fund the higher purchase price.