I wanted to share what I have been experiencing.

Our X3 lease is coming due next June but I was hoping to get out of it by end of year and into a new car.

I have always leased my daily car as I don’t have to worry about any minor scratches if they happen, parking in the city, or some idiot crashing into it then dealing with reduced value etc. There are many advantages.

Ever since Covid - the lease programs have been horrendous on most cars. This is across many brands both luxury and non-luxury. I think the new generation of consumers is just OK to take on massive debt or have car notes that are 6years or more.

Recently I have shopped several options I’m considering - MB GLE450 / 53amg, BMW X5, LR Defender, Acura MDX, Mazda CX90, VW Atlas, Subaru Legacy etc.
As a rule of thumb - a good lease payment should be about 1% of the car’s msrp without putting any money down. So for $50k car, a lease of $500 is considered good. The lease numbers I’m seeing are completely out of whack.
For $55k CX90, payment is in the high 700s for example.

BMW leases are completely insane - $80k X5 is $1,300 😂
MB is also over $1,200 for $82k GLE.
Mind you - these SUVs in SAME generation before Covid were $700-900.

I’m at $1,000 on my current X3 lease which was in 2023 where there was still some Covid hoopla, shortages etc but those days are way gone yet ppl are still paying these prices.

I think people in general are over leveraging themselves whether it’s student loans, cars, houses etc. Walking around these dealerships and looking at the window stickers, its just laughable what they are charging for the product that you get.

Anyway just venting as it’s frustrating to look at numbers that don’t make sense…..

 

Have you had any experience with leasehackr.com? That seems to be a good place to judge the market.

Although I personally place some stock in the 1% "rule," it is frequently derided there.

 

Varies by region. More urbanized areas with multiple competing dealers tend to discount more and leases end up being less. But overall, we are still way above and beyond where we were before covid. Manufacturers have purposely kept production and inventory down, which causing prices to spike. And interest rates are still high.

 

I actually contacted a few brokers from forums and places like leasehack - they weren’t able to do any better than what I can get myself. I have been leasing for a long time so I know all the games / structures probably better than some of the sales ppl. It’s just the programs themselves that are not very good. The residual is in low 50s combined with high MF/interest rate, so even if you get discounts and incentives, the final price is still inflated.

So for me now, it’s actually better to purchase rather than lease. Not something I prefer to do though lol.

 

I agree but also think that the average consumer especially the younger generation is more comfortable with huge monthly payments. The older generations especially boomers were much more frugal.

I don’t blame the automakers - if they can get away with inflated prices than for them it’s why not. But at least for me, I’m not interested in overpaying for a car or any other product.

 

i used to lease as well but that's why i just buy them now (not finance) and sell when i feel like. lease doesn't make as much sense anymore especially with the high interest rates

 

You need to bring your expectations up into reality. We have become accustomed to very low lease payments because of nonexistant interest rates and high rebates, tariffs are causing automakers to rein in rebates and subvented rates as a way of passing those on to consumers while appearing to hold the line on prices. If the prices you are seeing everyhwere are "insane" to you, yet people are still paying those prices...the issue is your perception of the prices, not the prices. Everybody isn't "foolish", they just live in 2025 and you are still in 2019. The 1% rule is about as salient as saying $100k is a high income. From the past.

 

Also, many younger are just simply not driving. I think the latest studied showed a much higher age for the average first-time driver.

 

Another option if you want a better lease deal, consider a sedan.

 

Definitely is. Paid $94.4k cash (plus TTL, etc) for my M3 2.5 years ago. Got a buyback offer from the dealer in the mail yesterday for $78k if I wanted to trade for a 2026. I don't, but that's not bad IMHO.

 

For me it still makes sense to lease financially because of the tax benefits.

 

While thats certainly one way to rationalize the market behavior, thats also the driving principle of how dealers get away with ADMs.

While living in the past is never a good way of approaching car sales, the length of time the op has for his acquisition should work in his favor.

Side note @RNM GS3 I see them leftover lot anchors known as XMs are ripe for the picking though.

 

It is what it is. If you want a car today, you have to deal with the realities of today. I have no issue with dealers charging ADMs if the market will pay them. I can choose to buy a car or not. This is one big reason why I haven't gone to an SUV, something like a Range Rover or even a GLS would cost more to lease than my S580 despite being cheaper price wise because they are more in demand with less incentives. Like I said the OP could consider a Sedan, he could get a $140,000 i7 for the monthly cost of that $83k X5. He could get a V8 760 for not much more. Payment on my $140k S580 is only $500 more.

When you want what everybody else wants, you're going to have to pay for that. Want what other people don't want? Deals are all over the place.

 

Yep 100% agree

I got a great quote on 740i of $1350 on custom build of $110k. Loyalty incentive is $7k I believe.
That is a decent deal vs paying almost the same on X5 that is 30k cheaper.

If only the 7 wasn’t hideous 😂
I did drive one extensively and the interior was impressive just don’t like the screens.

 

I have been leasing cars since 2005 going back to my GS300 which was like $500 back then.

Its not my perception- it’s more ppl wanting NEW cars and willing to pay CRAZY monthly payments. Therefore leases are no longer subsidized as they were before. Also some of those incentives are being spent to move EVs rather than SUVs which sell.