caddyowner

Generally, I've found that if your car habits fit the lease model of:

- a new luxury vehicle every 24 or 36 mos

- predictable annual mileage under 12 or 15K

- keep your car well-maintaine & in good repair

- accept a monthly car payment as a normal expense.

Leasing is generally cheaper than traditional buying with cash or finance. However, if your habits vary from the above, other options are less expensive.

I've decided to drive a new GS and trade my LS. I was planning to lease and spread my annual personal miles, thought to be about 27K, among my 3 vehicles (mainly split between the Prius and GS). However, I reviewed the model this weekend and determined that my annual personal miles will likely climb to over 33K per year plus my girlfriend is likely to be driving my Prius a lot in the coming years. I'm now planning to buy the GS with traditional financing with the LS in trade plus some additional $ down.

faifai83

It would depend on the opportunity cost of your cash.

There a money factor (interest) to be paid on a lease. For example: a 0.0019 money factor (* 2400) = 4.56% APR.

...as long as you can make more than 4.56% APY on your investments, it might be a better idea to lease.

jj14

Check out this article (old, but the principle is still the same - have to make some adjustments in interest rate - since you wouldn't be paying 6% interest rate, cost of car, maintenance cost, GAP insurance etc)
http://www.edmunds.com/car-buying/co...-used-car.html

(If you are considering paying the full purchase amount down when you purchase the car, consider what faifai83 said about your loss in investment income - but if you are considering monthly payments, you aren't paying for the car up front - so you can still invest the money)

I tend to keep my cars for a long time (7 years or so - very low mileage though). Based on calculations that I've done, buying has always worked out to be cheaper for me - compared to 2-3 separate lease agreements.

I agree with what caddyowner said. if your purchase habits match what caddyowner has listed, a lease may be a better option (there are a variety of lease vs buy calculators on the web - plug in your numbers and see what works best for you)

jjscsix

I have found that leasing makes sense if you keep a car three years or less, and you are leasing a car that the manufacturer has aggressive residuals (and decent money factors). The math is really quite simple to do if you do someone homework on what your expected trade-in value will be if you buy - and if you are realistic about it and have a good understanding of trade-in values. And resale value should not be confused with trade-in value.

Another factor for Texas residents is that it is not unusual to be able to get tax credits on leases. That makes a significant difference in making the comparison. For folks in areas where you only pay taxes on the lease payment, your have an advantage over those of us in states like Texas that charge tax on the full "purchase price" of the lease if you don't get tax credits.

Leo23

Hi All, thanks for explaining- certainly better than my Lexus dealer did.

My fault, I was unprepared when i made the purchase two months ago. He offered me a lease of $650 on a new gs 2011, value 52k, actually paid 45k. So, to me the lease in that case did not make much sense. He scared me off when he mentioned $750 lease for the upcoming 4gs. I see now an attractive $599 in NY area, based on a $55k(I think).

-aggressive residual: amount to pay when the lease expires, if the owner decide to keep the car, right?

rominl

iTrader: (4)

correct. if residual is aggressive, that means the lease payment will be low, perfect for those who don't care about buying out the car when leases expire

zoombie99

While I agree that the residual is high, the money factor is a little on the high side.

Got PSI

Just got off the phone with Keyes Lexus in CA (again). As it turns out, I CAN lease a car out of state. I knew that first sales guy I talked to the other day was just pushing me out because he didnt want to deal with the headache. Hopefully this lady can help me out. Im waiting for her call.

Howiiieee

I just picked up my long awaited car from Lexus of Riverside on Wed 3/28/2012

Red 2013 Lexus GS F-Sport with Lexus Dynamic Handling, Mark Levingson Audio, Head up display, Blind Spot monitoring, and Park Assist.

MSRP: US$60468.00
- $1000 from Dealer
- $1500 for Conquest rebate
- $1000 for Lexus Performance tour credit
- $500 Lexus of Riverside GS event credit

I think the tax is calculated before the rebate, still it is a good $4K off.
Extra Down payment $7000

Lease for 5 years, 15K miles/per year. @ $715
Residual at the end of the lease $23594

Add 4 year 60K miles maintenance contract $3000

Final lease price: $777 per month.

That's a lot of money, but it is for a great car.

Howiiieee

GX4704ME

What is this?

jj14

sounds like a maintenance contract that covers all scheduled maintenance for 4 years/60k miles... ?

Liferules

but that seems a lot of money for a 4 year contract!

freddy2020

Congrats I really want the HUD also but it is hard to get in the west coast...

jettie1767

Why did you lease for 5 years? I've always felt that leases don't make sense over 36 - 39 months.

Howiiieee

You are correct.

It is not cheap, but service done in Lexus is never cheap. However, with so many new tech in this new car, I want to have someone who knows or have the resources to fix it if needed.

While other maintenance are mostly fluid changes, the 60K miles one will get new brand new spark plugs.

I also love that I don't need to budget extra for maintenance the next four years and the cost is spread in the life of the lease. That's why I did it.

If you trust your independent mechanics shop to do your maintenance, you can save some money. That's what I did on the 2007 GS350 I just traded in for this F-Sport.