The Art of Buying or Leasing a New Sports Car
By Everette Jamison
It has been the norm to purchase a vehicle outright over the years. It was not until recently that leasing a vehicle became an option for the average person. For many people, leasing a new sports car will cost them less in monthly payments than it would cost to make payments. Because a car has usually depreciated in value once it has been paid off anyway, many people figure they might as well lease the vehicle. There are many side benefits to leasing as well such as: tax write offs, less upfront cash, the newest vehicles and innovations, and no long term, multi-year loan.
Even with the many benefits of leasing a sports car instead of buying, the latter is still the way to go for most people. Since banks and dealerships began offering extra low monthly payments, low interest rates, and cash-back offers, leasing has fallen out of favor once again. Studies have shown that the number of new leases to occur from 2001 to 2008 has dropped by 29 percent. As a result of this new lack of interest, both Chrysler and GM have dropped their new leasing incentives by a considerable amount.
Economists agree that the popularity of leasing a vehicle has to do with the costs involved. When interest rates are low, consumers simply are not going to be able to lease a vehicle for much less a month than they could to buy it outright. If the economy sees an increase in interest rates, then leasing will most likely become popular again. When it comes to the decision of whether or not to lease a vehicle, an individual will always choose the option that promises the lowest monthly payments.
Those that lease a vehicle still do have a lot of good reasons to do so. For example, when someone leases a sports car, they still have the option of buying it if they choose. This can even be looked at as a 2 year test drive. If you decide to lease and not buy, then you do not have to worry about the depreciation of the asset. Vehicles lose value when they are first driven off the dealers lot; to a person that leases, this is not even a concern. Another great thing about leasing is that there are no huge repair bills to worry about either. As long as a lessee takes care of the car and stays within the miles limits, they can turn in the car in and walk away.
While there are benefits to leasing, economists like to remind the public that the benefits are largely short term. In 2 or so years, the person will have to make the decision once again to buy or lease another vehicle. Leasing can mean endless payments, keeping track of miles, or annoying issues regarding wear and tear. Before you make the decision to either buy or lease, make sure you have weighed the pros and cons of each method heavily.
About the author
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