farewell, Sold the IS350
07-20-11, 08:17 PM
#31
Lexus Champion
1. because I can
2. the vast majority of people out there aren't like us. They don't surf the discussion boards about mods, maximizing a certain utility/option, etc. A car is a tool that gets them from point A to B. If they think they can get away putting a few more K miles before an oil change, they will. They'll save a few pennys / gallon and fill up at the *enter your local questionable gas station here* instead of Chevron or what have you. An acquaintance went 30K miles before an oil change because she thought an oil change was going to run $250. After she was set straight (on the cost of an oil change and that you can't go that long without one), she traded it in.
3. I don't think anyone is foolish to think that a carfax report is full-proof. It may or may not tell you everything about the car's history but it certainly won't tell you whether someone crapped their pants in the car, like my college roomate did a couple of times before selling it.
On the other hand, you may get lucky and get a car from an enthusiast, who maintained the car properly, never redlined the engine until fully warmed up, parked it way out in the lot to avoid door dings, and wasn't interested in any HPDE's or autocrossing it.
People's priorities are different, as mentioned above. I have a bud who orders very expensive wine when we go out for dinner. He has the means and he really enjoys it. He drives an 5 year old Camry and is perfectly happy with it. I like custom 1911 pistols for IPSC/USPSA. To compensate, I try to be frugal in other aspects that don't matter so much to me.
Last edited by al503; 07-21-11 at 08:50 AM. Reason: spelling
07-21-11, 06:02 AM
#32
Because its not always about the $. People have different priorites... The main reasons I purchase new cars include:
1. because I can
2. the vast majority of people out there aren't like us. They don't surf the discussion boards about mods, maximizing a certain utility/option, etc...
3. I don't think anyone is foolish to think that a carfax report is full-proof. It may or may not tell you everything about the car's history but it certainly won't tell you whether someone crapped their pants in the car, like my college roomate did a couple of times before selling it.
On the other hand, you may get lucky and get a car from an enthusiast, who maintained the car properly, never redlined the engine until fully warmed up, parked it way out in the lot to avoid door dings, and wasn't interested in any HPDE's or autocrossing it.
You also have to consider that people's priorities are different, as mentioned above. I have a bud who orders very expensive wine when we go out for dinner. He has the means and he really enjoys it. He drives an 5 year old Camry and is perfectly happy with. I like custom 1911 pistols for IPSC/USPSA. To compensate, I try to be frugal in other aspects that don't matter so much to me.
1. because I can
2. the vast majority of people out there aren't like us. They don't surf the discussion boards about mods, maximizing a certain utility/option, etc...
3. I don't think anyone is foolish to think that a carfax report is full-proof. It may or may not tell you everything about the car's history but it certainly won't tell you whether someone crapped their pants in the car, like my college roomate did a couple of times before selling it.
On the other hand, you may get lucky and get a car from an enthusiast, who maintained the car properly, never redlined the engine until fully warmed up, parked it way out in the lot to avoid door dings, and wasn't interested in any HPDE's or autocrossing it.
You also have to consider that people's priorities are different, as mentioned above. I have a bud who orders very expensive wine when we go out for dinner. He has the means and he really enjoys it. He drives an 5 year old Camry and is perfectly happy with. I like custom 1911 pistols for IPSC/USPSA. To compensate, I try to be frugal in other aspects that don't matter so much to me.
Lesson on economic utility = http://www.investopedia.com/universi...economics5.asp
07-21-11, 06:02 AM
#33
Why I bought mine new- (the first brand new car I ever bought, and I've bought a lot of cars)
It made no financial sense to buy used when I bought mine, so I bought new.
Now, 3+ years later, used 350s are a bit easier to come by (though still none the way I'd really want) but even so they're STILL selling in the high 20s to low 30s for those that have factory warranty remaining.
But back when I looked (mid 2007) the only USED ones were mid-high 30s. Which is more than I paid for mine new.
It made no financial sense to buy used when I bought mine, so I bought new.
Now, 3+ years later, used 350s are a bit easier to come by (though still none the way I'd really want) but even so they're STILL selling in the high 20s to low 30s for those that have factory warranty remaining.
But back when I looked (mid 2007) the only USED ones were mid-high 30s. Which is more than I paid for mine new.
07-21-11, 09:19 AM
#34
Because its not always about the $. People have different priorites. You can spend big bucks to get an Armani suit at Sak's or you might get lucky at the thrift store. The main reasons I purchase new cars include:
1. because I can
2. the vast majority of people out there aren't like us. They don't surf the discussion boards about mods, maximizing a certain utility/option, etc. A car is a tool that gets them from point A to B. If they think they can get away putting a few more K miles before an oil change, they will. They'll save a few pennys / gallon and fill up at the *enter your local questionable gas station here* instead of Chevron or what have you. An acquaintance went 30K miles before an oil change because she thought an oil change was going to run $250. After she was set straight (on the cost of an oil change and that you can't go that long without one), she traded it in.
3. I don't think anyone is foolish to think that a carfax report is full-proof. It may or may not tell you everything about the car's history but it certainly won't tell you whether someone crapped their pants in the car, like my college roomate did a couple of times before selling it.
On the other hand, you may get lucky and get a car from an enthusiast, who maintained the car properly, never redlined the engine until fully warmed up, parked it way out in the lot to avoid door dings, and wasn't interested in any HPDE's or autocrossing it.
People's priorities are different, as mentioned above. I have a bud who orders very expensive wine when we go out for dinner. He has the means and he really enjoys it. He drives an 5 year old Camry and is perfectly happy with it. I like custom 1911 pistols for IPSC/USPSA. To compensate, I try to be frugal in other aspects that don't matter so much to me.
1. because I can
2. the vast majority of people out there aren't like us. They don't surf the discussion boards about mods, maximizing a certain utility/option, etc. A car is a tool that gets them from point A to B. If they think they can get away putting a few more K miles before an oil change, they will. They'll save a few pennys / gallon and fill up at the *enter your local questionable gas station here* instead of Chevron or what have you. An acquaintance went 30K miles before an oil change because she thought an oil change was going to run $250. After she was set straight (on the cost of an oil change and that you can't go that long without one), she traded it in.
3. I don't think anyone is foolish to think that a carfax report is full-proof. It may or may not tell you everything about the car's history but it certainly won't tell you whether someone crapped their pants in the car, like my college roomate did a couple of times before selling it.
On the other hand, you may get lucky and get a car from an enthusiast, who maintained the car properly, never redlined the engine until fully warmed up, parked it way out in the lot to avoid door dings, and wasn't interested in any HPDE's or autocrossing it.
People's priorities are different, as mentioned above. I have a bud who orders very expensive wine when we go out for dinner. He has the means and he really enjoys it. He drives an 5 year old Camry and is perfectly happy with it. I like custom 1911 pistols for IPSC/USPSA. To compensate, I try to be frugal in other aspects that don't matter so much to me.
What I'm trying to understand are specific reasons for buying new vs. buying used. I'm not talking buying a 2011 Lexus IS vs. a 1995 Camry - the answer there is clear. You get more features, nicer car, more performance, warranty, etc. What I'm wondering about is a situation of a very recent car vs. a brand new car. Like comparing buying a used 2007-2008 IS350 vs. a brand new 2011-2012 IS350. They're almost the same car, with a few minor differences (LED headlights, etc). So the features, niceness of the car, performance are all the same. If it's about warranty, you could buy a certified one with 50k miles, which would give you a warranty for 3 years/50k miles, almost the same period as the factory warranty, and still come out price-wise far ahead of the brand new car.
When I bought my 2007 IS350, which was highly-optioned, it was $24k with 50k miles on it. It was also Certified, so I had a 3 year/50k warranty. So for exactly half the price as new (I just checked new IS350 prices in my area and I found multiple for $48k) I get a car with an almost-identical warranty with almost-identical styling, features, performance, etc. In addition to the fact that I acquired the car for half as much as a new car, I'll suffer far less depreciation as if I'd bought a new car, since car values drop most precipitously in the first couple years then flatten out.
So what is it about a brand new car vs. a couple-year old car, same features, styling, engine, even warranty? And to be clear, I don't hold one philosophy to be better than the other. I'm asking the question not rhetorically but out of genuine curiosity for what goes into the thought process.
Well said al503, most of us are frugal in certain aspects and liberal spenders in others. I own several pairs of $200+ sunglasses, I buy custom basketball shoes a couple times a year, and I drive a Lexus. On the thrify side, I bought the Lexus used, I live in a conservative house for my salary, clip coupons at the grocery, try not to eat out too much, and pretty much only buy clothing from the clearence rack. Everyone has a different economic utility.
Lesson on economic utility = http://www.investopedia.com/universi...economics5.asp
Lesson on economic utility = http://www.investopedia.com/universi...economics5.asp
Last edited by calvin2376; 07-21-11 at 09:22 AM.
07-21-11, 09:44 AM
#35
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I have never understood people who put down leases. I am a huge advocate of leasing cars. THEY'RE A DEPRECIATING ASSET!!! WHY WOULD YOU WANT TO OWN IT! Everyone needs a car so you HAVE to have one and some people want to drive an IS350 for $600 a month and some people want to drive a Toyota Yaris at $200 a month...to each their own. Some people want to tie up $10,000 cash (instead of putting it into a house or other investments) in a car and get a loan for $35,000 on their IS350...and pay like...$490 a month? Let me tell you guys a couple classic stories. I traded in my 09' IS250 with no NAV that I was paying $454 a month for...basically a rip off...(I didn't put anything down though). Anyway I decided 2.5 years away from the end of my lease and 12,500 miles OVER my miles...that I was done with that BS deal and I wanted to try and upgrade. I went in to the dealer, they gave me $500 UNDER my buyout for the car and a new 350 loaded for $500 over invoice. $800 down and I received my last car payment back so it ended up being $346 down. I basically took a very small hit for my bad judgement with the miles and also got to take all my F-Sport parts off the car. I pay $150 more a month...but I got triple the car and a deal that I am comfortable with. Now, my dad bought a 2008 GS460 in 2009 with 12,000 miles on it for $50,000 cash. He has since (two years later) put almost 70,000 miles on the car! 
Obviously it is out of warranty, starting to need a repair here and there and is probably worth maybe 34,600, now. So he's lost $15,000, is having to dump cash into the car for repairs and is tying up a bunch of cash, which he can afford to do, but why do it? Especially right now when you can get such a lower money factor and pay have the tax and registration on the car...to me it's a no brainer. I don't judge my dad's deal and he doesn't judge mine, nor would I anyone else's. But if you want to read some bad *** leases stories that would blow your mind and also how guys know really know how to manage money do it, go check ferrarichat.com in the 458 section. Ferrari financial is basically giving away 458's to qualifying people...it's pretty wild. Just my 2 cents.
Obviously it is out of warranty, starting to need a repair here and there and is probably worth maybe 34,600, now. So he's lost $15,000, is having to dump cash into the car for repairs and is tying up a bunch of cash, which he can afford to do, but why do it? Especially right now when you can get such a lower money factor and pay have the tax and registration on the car...to me it's a no brainer. I don't judge my dad's deal and he doesn't judge mine, nor would I anyone else's. But if you want to read some bad *** leases stories that would blow your mind and also how guys know really know how to manage money do it, go check ferrarichat.com in the 458 section. Ferrari financial is basically giving away 458's to qualifying people...it's pretty wild. Just my 2 cents.
07-21-11, 09:57 AM
#36
Now, my dad bought a 2008 GS460 in 2009 with 12,000 miles on it for $50,000 cash. He has since (two years later) put almost 70,000 miles on the car! Obviously it is out of warranty, starting to need a repair here and there and is probably worth maybe 34,600, now. So he's lost $15,000, is having to dump cash into the car for repairs and is tying up a bunch of cash, which he can afford to do, but why do it? Especially right now when you can get such a lower money factor and pay have the tax and registration on the car...to me it's a no brainer. I don't judge my dad's deal and he doesn't judge mine, nor would I anyone else's.
Obviously it is out of warranty, starting to need a repair here and there and is probably worth maybe 34,600, now. So he's lost $15,000, is having to dump cash into the car for repairs and is tying up a bunch of cash, which he can afford to do, but why do it? Especially right now when you can get such a lower money factor and pay have the tax and registration on the car...to me it's a no brainer. I don't judge my dad's deal and he doesn't judge mine, nor would I anyone else's.What I'm saying is that I'm not seeing how if your father had leased, he'd have gotten a much better deal than purchasing. In 2 years he took a $15,000 hit. If he'd leased in the exact same scenario, he'd have to have gotten a lease for less than $625/month to come out ahead, which would have been difficult 1) on a GS460, 2) driving 35k miles/year, and 3) without putting several thousand down.
I'm playing devil's advocate here, mainly to understand why in the above scenario you believe leasing would have been a better choice than buying.
Ultimately, in a financial analysis, it seems purchasing vs. leasing comes down to comparing the total amount you'd pay out in lease payments over a fixed term vs. the depreciation loss (in this case, the difference between what you purchase the car for and what you later sell it for) you take over the same fixed time period. Time value of money isn't too relevant here because you can finance a car in the purchasing scenario, putting down money up front and then making payments, just like leasing. So it really comes down to comparing those two amounts: total sum of lease payments vs. depreciation.
I agree with you that in many cases, leasing a new car makes more sense than buying, because the depreciation hit on new cars is huge, and especially if it's a brand new model, you won't have access to past market data and won't be sure of what the resale value will be at the end of a period of time, whereas with a lease you have a fixed residual value. However, I personally view buying used as superior to either scenario, because 1) the purchase price of the car is far less than a new car so you're paying out less cash to start with, and your payments are lower if you finance, and 2) depreciation is less severe the older the car is, so you take less of a hit.
Last edited by calvin2376; 07-21-11 at 10:09 AM.
07-22-11, 12:57 PM
#37
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I'm wondering in your father's example what a comparable lease would have cost him. So he bought a GS460 for $50,000, put on 70,000 miles in 2 years, and now it's worth $15,000 less. What would his payment have been if he'd leased it? Just doing simple math, if I take $15,000 / 24 months = $625. In this very simple example, if he'd leased it for a payment of $625 per month, he'd have ended up financially in the same position as today. $625/month doesn't seem high. On a GS460, where he was going to put 35,000 miles (!) on it per year? I just did a quick search and some of the lease deals on GS460s I'm seeing are $599/month, and that's only with almost $4,000 down and only 10k miles/year. The payment obviously would have been much higher putting nothing down and putting 35k miles on it per year instead of 10k.
What I'm saying is that I'm not seeing how if your father had leased, he'd have gotten a much better deal than purchasing. In 2 years he took a $15,000 hit. If he'd leased in the exact same scenario, he'd have to have gotten a lease for less than $625/month to come out ahead, which would have been difficult 1) on a GS460, 2) driving 35k miles/year, and 3) without putting several thousand down.
I'm playing devil's advocate here, mainly to understand why in the above scenario you believe leasing would have been a better choice than buying.
Ultimately, in a financial analysis, it seems purchasing vs. leasing comes down to comparing the total amount you'd pay out in lease payments over a fixed term vs. the depreciation loss (in this case, the difference between what you purchase the car for and what you later sell it for) you take over the same fixed time period. Time value of money isn't too relevant here because you can finance a car in the purchasing scenario, putting down money up front and then making payments, just like leasing. So it really comes down to comparing those two amounts: total sum of lease payments vs. depreciation.
I agree with you that in many cases, leasing a new car makes more sense than buying, because the depreciation hit on new cars is huge, and especially if it's a brand new model, you won't have access to past market data and won't be sure of what the resale value will be at the end of a period of time, whereas with a lease you have a fixed residual value. However, I personally view buying used as superior to either scenario, because 1) the purchase price of the car is far less than a new car so you're paying out less cash to start with, and your payments are lower if you finance, and 2) depreciation is less severe the older the car is, so you take less of a hit.
What I'm saying is that I'm not seeing how if your father had leased, he'd have gotten a much better deal than purchasing. In 2 years he took a $15,000 hit. If he'd leased in the exact same scenario, he'd have to have gotten a lease for less than $625/month to come out ahead, which would have been difficult 1) on a GS460, 2) driving 35k miles/year, and 3) without putting several thousand down.
I'm playing devil's advocate here, mainly to understand why in the above scenario you believe leasing would have been a better choice than buying.
Ultimately, in a financial analysis, it seems purchasing vs. leasing comes down to comparing the total amount you'd pay out in lease payments over a fixed term vs. the depreciation loss (in this case, the difference between what you purchase the car for and what you later sell it for) you take over the same fixed time period. Time value of money isn't too relevant here because you can finance a car in the purchasing scenario, putting down money up front and then making payments, just like leasing. So it really comes down to comparing those two amounts: total sum of lease payments vs. depreciation.
I agree with you that in many cases, leasing a new car makes more sense than buying, because the depreciation hit on new cars is huge, and especially if it's a brand new model, you won't have access to past market data and won't be sure of what the resale value will be at the end of a period of time, whereas with a lease you have a fixed residual value. However, I personally view buying used as superior to either scenario, because 1) the purchase price of the car is far less than a new car so you're paying out less cash to start with, and your payments are lower if you finance, and 2) depreciation is less severe the older the car is, so you take less of a hit.
Bottom line is that I think people should lease for the right deal. If some scum bag dealer is trying to get you to put $5k down on a $45,000 car with a $600 a month payment...no deal. Lease with the idea that you're turning it back in and getting a new lexus, bmw, audi...whatever, in 2-4 years...for me that flexibility mixed with the option of not tying up a large amount of equity is of huge value and works for me.
07-22-11, 03:08 PM
#38
Ok so I just did a Kelly Blue Book on the GS460 right now for fun and the trade-in value with his milage is $27,575. So that's almost $25,000 in two years. I'm not saying by him leasing it would have saved him a ton of money, other then the tax and registration, but it wouldn't have tied up his depreciating cash. Again some people don't like having a monthly payment and therefore just pay cash and paying interest on something that depreciates isn't a great idea but these days with great credit you can basically get free money. The money factor on my lease for my 350 works out to be almost 1.7%. Whether he leased the GS or not, the amount of miles that are on the car has driven down it's value obviously and you're right to get a $600 a month lease would have meant a big down payment and I think 15k a year is the limit. But to tie up cash in the down payment of a lease is idiotic too! Why would you make a $10,000 down payment on a car you're renting? My buddy did that with a Volvo and I just couldn't believe it...obviously to drive his monthly payment down.
Bottom line is that I think people should lease for the right deal. If some scum bag dealer is trying to get you to put $5k down on a $45,000 car with a $600 a month payment...no deal. Lease with the idea that you're turning it back in and getting a new lexus, bmw, audi...whatever, in 2-4 years...for me that flexibility mixed with the option of not tying up a large amount of equity is of huge value and works for me.
Bottom line is that I think people should lease for the right deal. If some scum bag dealer is trying to get you to put $5k down on a $45,000 car with a $600 a month payment...no deal. Lease with the idea that you're turning it back in and getting a new lexus, bmw, audi...whatever, in 2-4 years...for me that flexibility mixed with the option of not tying up a large amount of equity is of huge value and works for me.
Leasing involves making a down payment then making monthly payments. Most people who buy a car finance it, meaning they take out a loan on the car and put some money down up front but they also end up making monthly payments. So it's not like buying a car automatically means you're tying up a ton of equity in it - by financing, you can make it look just like a lease. You can end up actually tying up very little money depending on the size of the loan you take out, potentially even less than a lease on the same car that might require a large down payment.
07-25-11, 06:34 AM
#39
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wow lots of posts here, i was out of town for a few days (picked up the 335xi... love it so far... and i'll post a review post in about a week after i have a chance to drive it more... initial impressions are more fun to drive and actually more comfortable than the IS350... more details in a week or so!)
regarding the lease, and people saying "$600 to lease!!?!!"
first off, your purchase payment is NOT apples to apples... you have a purchase payment of 584... big deal, means nothing without the details. this is a 3 year lease. To purchase the car (sticker 55,000, sold at 48000)... say you finance 48000 over 3 years with NO interest and NO tax... your payment is $1,333/mo. My lease is $600/mo. big difference.
The only way your payment is lower than mine is: 1- terms are longer, 1- big down payment, or 3- cheaper car, or a combo of all 3.
my is350 was the same $600 a month and that was a great deal for a 3yr IS350 lease with no money down, taxes included, only first month due at signing. That was a 45000 car selling for 39000. 39000 over 3 years with no down and no interest and no tax would be $1083/mo...thats WITHOUT tax/interest.
if you arent comparing the same terms and tax then your comparisons are worthless. I dont care if your IS250 is 584 a month to buy because 1- the sticker is a lot less, 2- your terms are much longer than 3 years, 3- you probably put a down payment.
if anyone here has a purchase deal thats cheaper than $600/mo feel free to post the details of your purchase including sale price, terms, interest, month...and i'll be happy to explain why my payment holds up as a great deal. theres no way your making a purchase with the same low payment unless theres a BIG difference in price/months/tax/interest/down payment- and really if there is a big difference in selling price then making the comparison is pointless. Unless you bought a car for $21,600 after taxes and had 0% financing for 36months, your real payment is higher than 600, end of story.
and remember, after making significantly lower payments for 3 years, i still have to option to buy our and finance the rest of the car if i decide to keep it.
to the guys trying to explain leasing to others on here, thank you and good luck, i do not have the patience for that!
thanks for the help over the years, i'll be sure to post impressions after a week to help out anyone thats considering the 335.
regarding the lease, and people saying "$600 to lease!!?!!"
first off, your purchase payment is NOT apples to apples... you have a purchase payment of 584... big deal, means nothing without the details. this is a 3 year lease. To purchase the car (sticker 55,000, sold at 48000)... say you finance 48000 over 3 years with NO interest and NO tax... your payment is $1,333/mo. My lease is $600/mo. big difference.
The only way your payment is lower than mine is: 1- terms are longer, 1- big down payment, or 3- cheaper car, or a combo of all 3.
my is350 was the same $600 a month and that was a great deal for a 3yr IS350 lease with no money down, taxes included, only first month due at signing. That was a 45000 car selling for 39000. 39000 over 3 years with no down and no interest and no tax would be $1083/mo...thats WITHOUT tax/interest.
if you arent comparing the same terms and tax then your comparisons are worthless. I dont care if your IS250 is 584 a month to buy because 1- the sticker is a lot less, 2- your terms are much longer than 3 years, 3- you probably put a down payment.
if anyone here has a purchase deal thats cheaper than $600/mo feel free to post the details of your purchase including sale price, terms, interest, month...and i'll be happy to explain why my payment holds up as a great deal. theres no way your making a purchase with the same low payment unless theres a BIG difference in price/months/tax/interest/down payment- and really if there is a big difference in selling price then making the comparison is pointless. Unless you bought a car for $21,600 after taxes and had 0% financing for 36months, your real payment is higher than 600, end of story.
and remember, after making significantly lower payments for 3 years, i still have to option to buy our and finance the rest of the car if i decide to keep it.
to the guys trying to explain leasing to others on here, thank you and good luck, i do not have the patience for that!
thanks for the help over the years, i'll be sure to post impressions after a week to help out anyone thats considering the 335.
07-25-11, 06:39 AM
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the problem with a down payment on a lease is that if the car gets totalled and even with GAP protection, you dont get back the down payment. You can skip the remaining payments, but that money you put down is in the dealers hands and gone forever. If you have the credit score to avoid a down payment (i do,and many others do) you are never obligated to put money down.
down payments artificially lower payments, and i avoid them at all costs unless the interest rate/money factor is higher than the market rate... but then i wouldnt be taking a lease/loan thru that company anyways.
07-25-11, 10:00 AM
#41
Ok so I just did a Kelly Blue Book on the GS460 right now for fun and the trade-in value with his milage is $27,575. So that's almost $25,000 in two years.... Bottom line is that I think people should lease for the right deal. If some scum bag dealer is trying to get you to put $5k down on a $45,000 car with a $600 a month payment...no deal. Lease with the idea that you're turning it back in and getting a new lexus, bmw, audi...whatever, in 2-4 years...for me that flexibility mixed with the option of not tying up a large amount of equity is of huge value and works for me.
Just to be clear, I don't have anything against people who buy new (otherwise, where would I get my used cars?). It's just that personally, my cost-benefit analysis turns out to be far more in favor of buying used than new...
...I can definitely appreciate arguments about utility, since I was an econ major. If I put my above question in terms of utility, what incremental economic utility do you get out of a brand new car that you don't get out of a car with the same features, options, styling, engine, and warranty that happens to be 3-4 years old? I understand that there might be some utility derived from the fact that it's brand new (the smell, the feel, the knowledge of it being a brand new car), but especially for an econ-minded person, I find it hard to believe that these intangibles can be valued enough to offset a price difference of $25,000.
...I can definitely appreciate arguments about utility, since I was an econ major. If I put my above question in terms of utility, what incremental economic utility do you get out of a brand new car that you don't get out of a car with the same features, options, styling, engine, and warranty that happens to be 3-4 years old? I understand that there might be some utility derived from the fact that it's brand new (the smell, the feel, the knowledge of it being a brand new car), but especially for an econ-minded person, I find it hard to believe that these intangibles can be valued enough to offset a price difference of $25,000.
Many people have been burned on a used car that was wrecked, lemmoned, flooded, etc... so to them (and their utility) its worth the extra cost and peace of mind. To others it may be the status of buying the car new, or maybe they just have more money than us and dont care. Maybe they got a killer lease deal that was too good to be true, or maybe it was the only way to get out of their terrible loan/lease that they were in. To each his/her own.
...first off, your purchase payment is NOT apples to apples... you have a purchase payment of 584... big deal, means nothing without the details. this is a 3 year lease. To purchase the car (sticker 55,000, sold at 48000)... say you finance 48000 over 3 years with NO interest and NO tax... your payment is $1,333/mo. My lease is $600/mo. big difference.
The only way your payment is lower than mine is: 1- terms are longer, 1- big down payment, or 3- cheaper car, or a combo of all 3.
my is350 was the same $600 a month and that was a great deal for a 3yr IS350 lease with no money down, taxes included, only first month due at signing. That was a 45000 car selling for 39000. 39000 over 3 years with no down and no interest and no tax would be $1083/mo...thats WITHOUT tax/interest.
if you arent comparing the same terms and tax then your comparisons are worthless. I dont care if your IS250 is 584 a month to buy because 1- the sticker is a lot less, 2- your terms are much longer than 3 years, 3- you probably put a down payment.
if anyone here has a purchase deal thats cheaper than $600/mo feel free to post the details of your purchase including sale price, terms, interest, month...and i'll be happy to explain why my payment holds up as a great deal. theres no way your making a purchase with the same low payment unless theres a BIG difference in price/months/tax/interest/down payment- and really if there is a big difference in selling price then making the comparison is pointless. Unless you bought a car for $21,600 after taxes and had 0% financing for 36months, your real payment is higher than 600, end of story.
and remember, after making significantly lower payments for 3 years, i still have to option to buy our and finance the rest of the car if i decide to keep it.
to the guys trying to explain leasing to others on here, thank you and good luck, i do not have the patience for that!
thanks for the help over the years, i'll be sure to post impressions after a week to help out anyone thats considering the 335.In your first example of the BMW purchase at $1,333 a month ($48,000) and the lease at $600 a month ($21,600)... as long as the 3 year old BMW is worth more than $26,400 then the purchase is a better deal because the actual cost would be the amount of the payments minus the value of the car since its paid off in 3 years in your example.
A more comparable payment to your BMW example would be someone purchasing it for $48,000 and financing the whole amount for 7 years at 3%. The payments would be $634/mo. After 3 years, the balance of the loan would be $28,654, so as long as a 3 year old BMW with an original MSRP of $55,000 was worth more than $28,564 then you would be better off with the purchase.
An even better example is my USED purcahse of 2006 IS350 for $25,000, Loaded with NAV/ML and more with 14,000 miles. A 3 year payment on $25,000 would be about $700 a month and then I would own a car worth well over $10,000 and the leasee would be back at ZERO$ and ZERO car.
I understand why some people lease, its just not for me.
Last edited by BLexodus; 07-25-11 at 10:05 AM.
07-25-11, 02:50 PM
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It would be hard for me to stomach $25,000 depreciation in just two years. When I say that purchasing is right for me, my depreciation numbers are a lot less as a $ amount and as a percentage. Knowing when to buy a used car is key, buying a car 1-2 years old can sometimes be a terrible idea if it hasnt seen much depreciation.
SHHHHHHH!!!!! Dont let the new buyers know our secret, I still want to be able to buy a quality used lexus at a good price!!!
Many people have been burned on a used car that was wrecked, lemmoned, flooded, etc... so to them (and their utility) its worth the extra cost and peace of mind. To others it may be the status of buying the car new, or maybe they just have more money than us and dont care. Maybe they got a killer lease deal that was too good to be true, or maybe it was the only way to get out of their terrible loan/lease that they were in. To each his/her own.
Um... are you comparing apples to apples?
In your first example of the BMW purchase at $1,333 a month ($48,000) and the lease at $600 a month ($21,600)... as long as the 3 year old BMW is worth more than $26,400 then the purchase is a better deal because the actual cost would be the amount of the payments minus the value of the car since its paid off in 3 years in your example.
A more comparable payment to your BMW example would be someone purchasing it for $48,000 and financing the whole amount for 7 years at 3%. The payments would be $634/mo. After 3 years, the balance of the loan would be $28,654, so as long as a 3 year old BMW with an original MSRP of $55,000 was worth more than $28,654 then you would be better off with the purchase.
An even better example is my USED purcahse of 2006 IS350 for $25,000, Loaded with NAV/ML and more with 14,000 miles. A 3 year payment on $25,000 would be about $700 a month and then I would own a car worth well over $10,000 and the leasee would be back at ZERO$ and ZERO car.
I understand why some people lease, its just not for me.
SHHHHHHH!!!!! Dont let the new buyers know our secret, I still want to be able to buy a quality used lexus at a good price!!!
Many people have been burned on a used car that was wrecked, lemmoned, flooded, etc... so to them (and their utility) its worth the extra cost and peace of mind. To others it may be the status of buying the car new, or maybe they just have more money than us and dont care. Maybe they got a killer lease deal that was too good to be true, or maybe it was the only way to get out of their terrible loan/lease that they were in. To each his/her own.
Um... are you comparing apples to apples?
In your first example of the BMW purchase at $1,333 a month ($48,000) and the lease at $600 a month ($21,600)... as long as the 3 year old BMW is worth more than $26,400 then the purchase is a better deal because the actual cost would be the amount of the payments minus the value of the car since its paid off in 3 years in your example.
A more comparable payment to your BMW example would be someone purchasing it for $48,000 and financing the whole amount for 7 years at 3%. The payments would be $634/mo. After 3 years, the balance of the loan would be $28,654, so as long as a 3 year old BMW with an original MSRP of $55,000 was worth more than $28,654 then you would be better off with the purchase.
An even better example is my USED purcahse of 2006 IS350 for $25,000, Loaded with NAV/ML and more with 14,000 miles. A 3 year payment on $25,000 would be about $700 a month and then I would own a car worth well over $10,000 and the leasee would be back at ZERO$ and ZERO car.
I understand why some people lease, its just not for me.
but for educational reasons lets work it through:
with your example, you are assuming you can get BMW financing for 84 months at 3% which is highly unlikely. they are doing 3% up to 60months right now, 3rd party can do that for 72... pushing that to 84 will likely put you at 5% or higher, at which point your monthly rate is much much higher...
say you can get it for 3% though, with tax that 48000 is 51240. Your payment is now 677/month. after 3 years, the principle remaining is 30588. you've also paid $2772 additional over 3 years. To break even you need to fetch 33,360 after 3 years (30588+2772 extra paid) vs a lease with no buyout- this would mean you used the car for 3 years and got rid of it in both cases... and youd have spent $21600 in both cases. That $33,360 is higher than the expected residual of $32,623, so the market needs to swing in your favor a little.
My buyout after my lease is $32,623+tax (only if i buy it out)=34825.
IF the residual is what BMW expects, then I would be saving $737 by leasing instead of buying and selling @ 36mo.
Should I decide to purchase the car at 3 years in full:
If the residual is truly higher then buying upfront may save some money, but you are playing the market at that point. With leasing in this case I can buyout at the end if the true value is higher than $34,825 (32623+tax = 34825), sell and come out a little ahead (but thats way more effort than im willing to expend). If the market rate is LOWER than expected you are upside down on your loan, but i can get rid of my lease (or buy it at the lwoer market rate).
07-25-11, 03:49 PM
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dude you were comparing payments on 36 month lease to 36 month finance. Obviously the finance is going to be way higher because you are paying for the whole car. Over the 36 month lease you are only borrowing 30-40% of the vehicle not the entire amount... 17500 (35% of 50k) / 36 = ~500. 50000 / 36 = 1300. Except you own the car. Lease you borrow it, or if you want to buy it you need to make that 500 payment for another 5-6 years after the lease ends. Your example made absolutely no sense at all
07-25-11, 04:10 PM
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What's up with all these lease vs finance posts? Let's just congratulate him and move on. Some people likes to lease and some people likes to own. It's their money, let them do whatever they want with it.
To OP, congrats! 335i was one of my choice as well when I was cross shopping between G37 / IS350 / 335i. I really liked G37 until they introduced their 2011 line up with that awkward sport bumper. I'm not hating on the G37 because I absolutely love their exhaust tone but couldn't love the new body style. 335i was very tempting but it was out of my budget when I added up the packages I wanted. I fell in love with the new F Sport package with the 2011 2IS so I decided to get a F Sport IS350. Of course reliability was one of my top priority as well so that helped into consideration.
Again OP, congrats and enjoy your car!
To OP, congrats! 335i was one of my choice as well when I was cross shopping between G37 / IS350 / 335i. I really liked G37 until they introduced their 2011 line up with that awkward sport bumper. I'm not hating on the G37 because I absolutely love their exhaust tone but couldn't love the new body style. 335i was very tempting but it was out of my budget when I added up the packages I wanted. I fell in love with the new F Sport package with the 2011 2IS so I decided to get a F Sport IS350. Of course reliability was one of my top priority as well so that helped into consideration.
Again OP, congrats and enjoy your car!
07-25-11, 06:20 PM
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dude you were comparing payments on 36 month lease to 36 month finance. Obviously the finance is going to be way higher because you are paying for the whole car. Over the 36 month lease you are only borrowing 30-40% of the vehicle not the entire amount... 17500 (35% of 50k) / 36 = ~500. 50000 / 36 = 1300. Except you own the car. Lease you borrow it, or if you want to buy it you need to make that 500 payment for another 5-6 years after the lease ends. Your example made absolutely no sense at all
regarding the previous post about 1300 vs 600, yes obviously i know leasing is borrowing, but earlier in the thread, if you read it, people were making comments such as "my payments XXX , i pay less and i will own it!" and im stating that they are making poor comparisons regarding terms and actual sale prices. It CLEARLY wasnt stating that leasing is better just because the payment is less than half. So ya, the examples made plenty of sense if you paid attention to what was actually being said.
to the rest, thank you for the kind words. im enjoying the ride a lot.. but ive noticed the suspension is very soft... the spring rate seems fine but the dampers are too soft, i bounce a little too much after hitting some bumps ( i think thats more damper than spring rate right?). body lean in turns isnt too significant, but the IS felt more planted. then again the commute is smoother in the 335.
