VisualEcho

FWIW, I purchased my '18 IS350 AWD FS new for a few thousand less than the '17's with low miles were going for, AND got .8% financing. This is because I purchased in October, and took advantage of the special lease.

Moral of the story? Always compare the price of a new one in October before buying a used one, these cars retain their resale so much that many times it's better to buy new.

Now, if you were buying a Dodge...

unioncorps

^ Very true; should go without saying to always compare how much of a price difference it is between new and used.

I also bought my '18 IS350 AWD F-Sport new that was fully loaded for around the same price (after dealer incentives and discounts) as 2017 CPOs with very low miles. Of course, it depends on the price range you're willing to spend but in my case, it made much more sense to buy new. And in case you were wondering, I did buy at the end of the month too when the dealership was more willing to give a slightly better price than sticker.

VisualEcho

Not sure it's true for everyone, but the 2 Lexus dealerships in St Louis, Missouri don't get the new model year of the IS before ALL of the old ones are sold, so they have a big incentive to sell at the end of the year. They also are allowed to lose money on them in October to do so (the factory reimburses them). My car stickered for $52,300 IIRC, and I got it for $38,200.

Now BMW, not so much. I looked at an '18 M2 in APRIL of 2019 and they wanted to sell it, but they didn't want to sell it that bad, and were fine with getting 19's and having an 18 on the lot.

GaryJG

I prefer leasing.

It's usually only about $400 a month with zero due at signing.

Olasek

Excuse me, why are you asking this since you already have access to the car with the ML? Just listen to it with a good CD, don't let others tell you what you can easily test yourself.

Tharr62

I was a lease guy for years. Now, at 37 I see its not the best option. (need to now convince my wife of the same LOL).

I mean, I just bought a CPO with 23K on it.. for less per month than a lease, and in 60 months its mine and will be worth more than $10K easy. It's just so hard to keep leasing over and over again. Your just renting the car, and for some exotics this is the only way for sure. But man, for a nice Lexus.. where its mainly just tires, oil and brakes. Own it! Stop the cycle and start saving money for things that matter more than a car!

VisualEcho

I never lease to lease, I lease to buy. I just do it to get the special incentives and money factor, then at lease end I usually get a traditional loan for however many months I can get the best rate.

Tharr62

Yes, I did that too on my last car 2015 RX350. In my case I needed to lease to absorb negative equity from a trade (another lesson learned). However, in my case I had a new model year MDX (2014 re design) and it was a MAJOR problem with steering shutting down, and frame issues! I could not get the lemon.. and decided to dump it. That's when I became obsessed with Lexus, and learned what quality truly is.

Leasing is still more costly in the end, *sometimes* on a blue moon you can get it to balance out IF you negotiate hard on the buy out price at the end. But with Lexus, it's tricky because of the value they typically hold. For example my wife with a perfect credit score of 800 / 790 is leasing her 2018 RX. She did zero down and has a mid / top level package. Its $510/mo. So, she will pay $18,360 for the term. If she buys it.. she will once again now get financing (and used APR is never that great).. so lets say the balance is around $32K.. on a new 60/mo with current offers of 5.3% shes looking at $608/mo (now too much) and the total cost to own is now $36,497 + $18,360 = $54,857 which.. is about $5K MORE for the same car. AND there is no CPO. Also, this is now 8 years of car payments.. and thats just not a good idea.

vs.

Buying a 2 / 3 yr/old car with CPO. You can save over $20K AND have a three year warranty as I just did with my 2016 IS.

So, it all depends on what your goals are and how much you truly want to spend on a car. But, leasing is almost never the way... unless you want a toy for the weekends and have lots of cash. Or.. want to "test" a new model year car and are willing to pay extra for it.

I mean.. I just bought a once $48K Lexus IS for $24K that has only been on the road for two and a half years with 23K on the clock and I have all records and CPO for three years (first in service date was 6/2016). THIS is a deal! In the same time period (60/mo) my payments are FAR less.. the car looks brand new.. I have almost the same warranty, AND can sell for at least $10K at the end for money down on another good deal. So really my only "cost" is about $11K ;-) This just seems soooooooo much smarter in todays world where everything is so $$.

Just another option for someone who wants to try another way and be smart with money too.

VisualEcho

Not necessarily. In fact, not even generally, if you know what you're doing.

If the purchase price is the same (and it should be), and there is an incentive given by the manufacturer to lease, then you're ahead that amount less your total financing in the end.

So, for example, if your first 3 years on a lease are .8%, and your next 2 are 4.9% on the traditional (making 5 years total), you have to figure the difference on what it would have been at 2.9% (or whatever your best buy rate is) over the life of a 5 year buy.

I take the money, take the extremely low money factor, then get a very low interest rate loan for the remainder (credit union, as opposed to a bank, is better every time). I come out on top every time.

Lexus offers such a great lease because they want you to treat the vehicle with care, and turn it in 3 years later, flooding the market with fantastic used cars that they can certify and make a mint on because of resale.

In fact, if you do turn the car in, even with the generally lower payments of a lease, you're losing money because 9 times out of 10 you could sell it outright for more than what's owed against it.

I sold cars for 4 years bro, I know this stuff. But for those that don't understand all the bits and bobs, just buy for payment like the rest of the sheep.

Tharr62

Thanks for your expert advice, with your whopping 4 years of "experience" selling cars! I sold cars too when I was in my 20's and I learned to be smart with my money and there is absolutely no arguing with any of what I said above. This is tried and true, and simply makes common sense. Bro, LOL.

Hey, your not wrong.. anything can be done. Its a tricky tight rope and the truth (and reality, lets face it) is that your average consumer walking into the dealer is just not going to get this deal. What I am saying, is that its just a lot easier to go CPO and save a TON of cash right up front and let someone else take the depreciation hit. I would much rather ride around town in my "looks new" Lexus for $11K out of pocket for the whole term vs. paying a whole hell of a lot more for a new one.

To each their own. When I worked and sold for BMW here in Miami, FL I had a sick M3 for a period of time under a lease. This car was in the shop all the time (nightmare) Leasing was a big savings for the fun I had with that car. I would have to be nuts to now want to own a BMW as a CPO car LOL. But, we are talking about one of the most reliable cars out there (Lexus), so I am a big fan of people saving money and living within means. It just makes more sense for MOST of us.

However, when your coming off a current lease and need a car NOW.. timing needs to be in your favor. Sometimes it is.. and sometimes not. Again, not great for a lot of people. It just depends. December to remember event is nice for sure.. but, right now the current lease deal on the IS (as an example) is $2,999 down and then I get a $5K lease incentive. LOL. Move that figure to zero down, and change an option on the car to a different trim and now there is no deal. It's a scam for most people, most of the time. Scotty did a nice video on this on his YouTube channel.. I will see if I can find it.

This depends on your local market more than anything. Here, in South Florida. Not a chance. Just like you said.. "a flooded market". Here every other car on the road is a Lexus. They dont hold the same value, and here its a used market for sure as you can get some insane deals on pre-owned. (which is where my whole point stems from) We have leased a 2015 RX, 2015 ES, and now my wifes current 2018 RX. My in laws also lease the NX, and my sister in law just leased a new GX (love that truck). In all the contracts, the buy out is more then the current selling price on Autotrader for the same optioned car at the same age, and estimated miles. Thousands in fact. I just went through this with my 2015 RX. The selling price on AT was around $28K in my area for one with 32K on it. This was either the same or $2K more then the balance. AND if I flip it into a loan now, I dont get more CPO (which is a big deal) AND I have a higher APR because its a used car now. You dont generally win at this game my friend, and besides.. who wants to make car payments for EIGHT YEARS? LMAO.

Get a nice, low miles CPO.. do a cash deal (bank check) and pay half for the car like I did. Much smarter ;-) 5 years from now its owned free and clear, all the while less per month AND CPO for three years (in my case). Once I flip the car for $10K.. I have only spent about $11K. This is the best way, and most people will agree.

VisualEcho

4 years was quite enough for me, and more than enough time to be an expert on buying/selling/financing.

But now you're comparing apples to oranges. COP is not new, but you pay a mint for it anyway because the resale is so high on these cars. If the resale was terrible I'd agree with you 100%, but it's not.

I'm in MO, but I'm certain that if I were in FL I could buy the car at lease end, detail it, make sure all the service was perfect, and make money selling it outright myself.

I disagree...bro.

Tharr62

Your right 4 years is a long time in the car industry! Its not easy, so I commend you for that!

So this 2016 I just bought.. it was $44K new. It was purchased 6/11/16. Driven about 7,800 miles a year, and had all the dealer service done. I picked this up a few weeks ago for $24K flat out the door. (pics above). The car is truly now in mint condition. I really love it too! (so sick). This car dropped almost 50%!! in three years. To me, if a car is going to have a REALLY strong resale no more than 30% loss.

Now.. the car is still under the original manufacturer bumper to bumper. (in service was 6/16) so because of the low miles, and my driving is only 8K a year.. this means I still have a full year before the CPO even kicks in! So, this is now near new car territory for service, with three years in total. Lets not forget.. that if I were the original owner of this car.. and wanted to buy it at the end of the lease, it would NOT have the CPO.. and this is a factor to think about!

Lets now look at this in 5 years when its paid off. Based on other 10 year old IS models in my area I can expect about $10K. (especially this one with low miles etc..).

This means, that after I sell it.. I will be left only paying $11,000 plus any interest on the loan for this car!

I mean.. this all is what it is. You can say, think, or advocate what you want.. and yes, on paper it may look good. But in reality, a deal like this just is so easy to live with and makes very nice, solid, common sense. None of this logic is "sheep" or based on any "payment" either. It's based on the selling price of a car, that is always a terrible "investment" anyway. So, it only stands to reason to mitigate this as much as possible and get over the "new" bug that SO many poor people have in today's world.

If you really want your "cake and eat it too" than this is by far the best plan, and you save up front money.

Anyway. I know you think I am wrong.. lets see if someone else wants to chime in with their honest thoughts...

VisualEcho

Where to begin.

First, you really like your apples with your oranges don't you? You're comparing new to used, and you're always going to spend more for new, but for many it might just be worth it, because in the long run it won't make much difference.

Second, your car may have LISTED for $44K new, but that's not what was paid for it, so your depreciation calculation is completely wrong.

Lastly, your idea of "mint" is quite different from mine. Compare your car to mine and I'm sure you'd understand quickly that yours isn't mint.

In reality you got a used car, and I got a new one. New as in, I got to pick the color, the options, it was flawless when I got it, and it had 100% factory warranty. I paid $38K for a new car, and you paid $24K for a used car. It is what it is.

Tharr62

That your kinda being a jerk, dont you think? Why cant you simply admit that what I am saying is true and a good idea for most people who want to get a nice car and yet save some money.? I already bowed down, and told you that you were right and that what you said could work too. Its just a lot harder to do, and requires much more luck than anything else.

Did you happen to catch the title of this thread? Or can you read? This is a NEW vs. USED thread bro. Thus, this is about sharing thoughts on each. Which.. is why I said before that you had some good points. But, you insist on highlighting what I say, and imply that I am wrong. I am not wrong, its simple math and a LOT of common sense.

It was sold for $41,500 (actually leased) based on that MSRP to the original owner. It LISTED for $43,545. I end up paying $11,000 BRO.. ELEVEN GRAND. for pretty much the same car. You want to throw your money in the toilet and play complex games with cars.. LMAO, go ahead. Ill go on a nice trip to Paris with my family and call it day, all the while driving the same nice car.

LMAOOOOO give me a break. What, are we buying a Ferrari now? Seriously.. do you hear yourself at this point.

I got news for you bro.. so did I. So did I. I used the search feature on Autotrader and got the color I wanted and all of the features. I got the same warranty too. Oh.. and by the way.. your "new" car is only new when your signing the papers in the F&I office. The second you leave the lot.. its just as used as mine ;-) AND.. with one bad day at the food store you may find a ding in your fresh paint, vs. mine still "flawless" bro, anything can happen "new" or not. Need to get over that.

The only FACT here is that I have saved about $20,000 on the same deal and I get all the benefits.

Anyway, you can have the last word on this.. I am done. This is insane now.

babaijebu

Opinion on these kinda questions are baseless anyway. It all depends on your budget. I buy used, but that's because that's what i can afford. If i can buy new without going over budget, that's all i will buy all day and change it every 3 years.