Be honest please.

[Chrisb2015]

Nothing wrong with either approach. I don’t hold with the ‘rent it if it depreciates’ argument as funders understand cost of capital and depreciation better than we do so finance only makes sense if your own return on investment is higher and/or you get better prices for taking finance as is often the case on new cars these days. Of course there is nothing to stop you paying off the finance once you have received the incentives (deposit contribution, free services etc).

The main reason people go PCP or leasing is that it gets them into a car that they may not be able to afford for cash or on HP. The manufacturers know this and, as it means people change their cars more often when acquired this way, do all they can to promote it - notice how many new car adverts these days don’t actually mention what the capital cost of the car is they purely mention the headline predatory price per month with a tiny * taking you to the hugely variable deposit you need to make. There is a lot of mis-leading advertising in this regard and this will be regulated much more strongly in the aftermath of the financial crisis which is gently brewing.

There is definitely a cultural shift and move towards consumption economics across the board, not just car ownership. I am of a generation that was taught if you can’t afford it don’t buy it, but I can also see the double standard in all this. I was encouraged into home ownership at every turn. I was lucky, had a good financial education and made in hindsight some good decisions, but many in the aftermath of 2008 were left in significant trouble despite house ownership being the supposed promised land. The reality in MHO is almost everyone uses finance to a greater or lesser extent and using it for a house purchase is no more worthy or morally correct than for a car. The key is to try as far as is possible to make sure that it remains affordable should the unexpected happen. It is only in recent times that bricks and mortar have been considered better or a safer bet, many forgetting recessions past and double digit interest rates.

 

[FF1078]

Exactly! How many people are in a position to spunk £80k on a motor? Or even spend £20k on a new Ford Fiesta when you can lease one for £99 per month with a £800 deposit. When you add up the total cost for the monthlies the money spent is actually less than the depreciation in most cases so lease is a much more sensible option. Plus many emplyers now give car allowances instead of a company car so leasing is perfect for fixed monthly costing and budgeting etc.. mine gives it so I run what I can with those monthlies in this case the GTS.

You don't. You buy one car and run it for how ever long you want while still working and saving, you then chop your £40k car in and put another £40k in and get an £80k car and so on until your happy with your car or cars. Welcome to the layer cake son as Micahel Gambon put it on the film.
I totally understand why people lease or PCP it's just not for me. As I said I'm old fashioned.

 

[Goodfella]

Welcome to the layer cake son as Micahel Gambon put it on the film.

Bunch of f*ck pigs.

 

[rockits]

that’s on a used car. Talking new... do the maths on a new one and then see..

You might be talking new but the OP mentions nothing about new cars just cars in general.

It is pretty obvious that it is better for a private punter to lease/rent a new car these days against buying one as the discounts are massively imbalanced day one. The most a private punter will ever get off a new car on average is max 15%. The lease & rental companies get 50% discount in comparison. You are at a 35% disadvantage day one. Best you can hope for is that the profit they make absorbs that 35% difference so you are neutral.

I suspect a new Discovery Sport SD4 HSE would be circa £500pcm. I am happy buying my 3 year old and running it for £145 per month thanks. Over 4 years that saves me £17k. I don't need a new car that badly lease, rent or purchase. That is £17k net after tax btw. I can see why half the country haven't got any chuffing money!

An additional major contributory factor for me is I can sell me owned and paid for car any time I want whenever I want and am not tied into 2/3/4 or more years of a lease without penalties or mileage restrictions. I risk being kicked in the knackers when I hand it back with a few bumps and bruises on it.

Every body is different and there is no right or wrong but I can't afford to and don't want be dropping an extra £17k net one a new car. I'll have an old one That £17k pays for a QP GTS with running costs for 4 years!

 

[Chrisb2015]

You might be talking new but the OP mentions nothing about new cars just cars in general.

It is pretty obvious that it is better for a private punter to lease/rent a new car these days against buying one as the discounts are massively imbalanced day one. The most a private punter will ever get off a new car on average is max 15%. The lease & rental companies get 50% discount in comparison. You are at a 35% disadvantage day one. Best you can hope for is that the profit they make absorbs that 35% difference so you are neutral.

I suspect a new Discovery Sport SD4 HSE would be circa £500pcm. I am happy buying my 3 year old and running it for £145 per month thanks. Over 4 years that saves me £17k. I don't need a new car that badly lease, rent or purchase. That is £17k net after tax btw. I can see why half the country haven't got any chuffing money!

An additional major contributory factor for me is I can sell me owned and paid for car any time I want whenever I want and am not tied into 2/3/4 or more years of a lease without penalties or mileage restrictions. I risk being kicked in the knackers when I hand it back with a few bumps and bruises on it.

Every body is different and there is no right or wrong but I can't afford to and don't want be dropping an extra £17k net one a new car. I'll have an old one That £17k pays for a QP GTS with running costs for 4 years!

I agree with most of your logic but it’s not a fair comparison. Used will almost always work out cheaper in a side by side comparison when compared with buying new outright with the initial depreciation factored in. This however ignores the peace of mind and desire to own a new car. This is where this argument always falls apart. The buyer of a new car has no interest in a 10 year old QP and wants new, modern and a manufacturer backed car. Likewise the second hand buyer feels smart, smug and better off for being able to pick up a relative bargain after the initial depreciation hit and accepts the chance of a bigger repair bill and potentially less trouble free motoring. More than one way to skin a cat.

 

[Contigo]

Reminds me of the Chris Harris thread on Pistonheads when he bought a FF on finance, £35k down and £150k on pcp with monthlies around £2700. People were livid with him and I just watched on and thought fair play, it enabled him to further his career as a journalist/petrolhead and you could argue got him the gig he has now at TG. You have to take risks in life to get on.

 

[Contigo]

I agree with most of your logic but it’s not a fair comparison. Used will almost always work out cheaper in a side by side comparison when compared with buying new outright with the initial depreciation factored in. This however ignores the peace of mind and desire to own a new car. This is where this argument always falls apart. The buyer of a new car has no interest in a 10 year old QP and wants new, modern and a manufacturer backed car. Likewise the second hand buyer feels smart, smug and better off for being able to pick up a relative bargain after the initial depreciation hit and accepts the chance of a bigger repair bill and potentially less trouble free motoring. More than one way to skin a cat.

Exactly. Where's the warranty on that 3 year old Disco Sport? How much are the bills when the turbo goes? Factor 3k on that a year to run it like any Landy/Rangie. So again it's not a fair comparison esp as these lease deal have the RFL thrown in for the duration, wear and tear including tyres and servicing. It's proper fixed price motoring with no hidden costs or dramas.

 

[Chrisb2015]

Reminds me of the Chris Harris thread on Pistonheads when he bought a FF on finance, £35k down and £150k on pcp with monthlies around £2700. People were livid with him and I just watched on and thought fair play, it enabled him to further his career as a journalist/petrolhead and you could argue got him the gig he has now at TG. You have to take risks in life to get on.

I loved the way he addressed this directly in the video review knowing full well it would be a topic of huge interest and discussion on the forums. Agree, good for him. I bet he won’t look back and regret it on his death bed.

 

[Contigo]

You don't. You buy one car and run it for how ever long you want while still working and saving, you then chop your £40k car in and put another £40k in and get an £80k car and so on until your happy with your car or cars. Welcome to the layer cake son as Micahel Gambon put it on the film.
I totally understand why people lease or PCP it's just not for me. As I said I'm old fashioned.

And how many people earn a wage where they can save 40k in 3 years or even 10 years let alone adding 40k to a 40k car. I suspect very few. Again it's not for everyone but don't hate.

 

[Contigo]

Thread is heading Pistonheads way. The op should have the thread re titled "Be honest now, which ones of you Peasants need finance?"

 

[Chrisb2015]

Thread is heading Pistonheads way. The op should have the thread re titled "Be honest now, which ones of you Peasants need finance?"

Speak to any high end car company and the majority of their cars are financed. Speaking to a finance contact the other day about the state of the high end car market he said amongst other things that hardly any of his clients ever intend to own the cars they finance. He actually made a point of saying only one Ferrari he has financed recently was considered a keeper by its owner, this being the last UK registered 458 spider, which went to a wealthy collector. He also mentioned it is quiet and high end stock is sticking...........but the £40-70k market is holding up quite well.

 

[Gp79]

Cash only here for cars / motorbikes etc.

No money, no honey!

But most of mine have been / are sh1te, for me having a 20-50k Bmw or similar that is then worth 1/2 that in a few years is a total waste of money.

The GS in the other hand is money well spent!

 

[GeoffCapes]

Speak to any high end car company and the majority of their cars are financed. Speaking to a finance contact the other day about the state of the high end car market he said amongst other things that hardly any of his clients ever intend to own the cars they finance. He actually made a point of saying only one Ferrari he has financed recently was considered a keeper by its owner, this being the last UK registered 458 spider, which went to a wealthy collector. He also mentioned it is quiet and high end stock is sticking...........but the £40-70k market is holding up quite well.

I'm sure I read somewhere that almost 99% of new cars are financed now.

Should we have another recession, surely that leaves the car market on it's ar5e?

 

[Contigo]

I'm sure I read somewhere that almost 99% of new cars are financed now.

Should we have another recession, surely that leaves the car market on it's ar5e?

And imo it is heading that way right now so I suggest people get out of them unless they can afford to lose their shirt.

 

[FF1078]

I should have said I'll never buy a new car. I only buy second hand. Let someone else loose the big money for 2 years of ownership.

 

[rockits]

It started with the housing market and the car market is going the same way. People are going to go through life with no house ownership, no car ownership, no savings, no wiggle room, no inheritance for their children and no investment in the future. If we don't invest in our future and everyone does the same thing the planet will cease to exist.

I understand people want to live for today and enjoy their lives. However at the expense of their children and their children's children and every generation to come after that. Not sure it works does it. We all can;t be Chris Harris can we.

If you work hard enough, are efficient and save hard enough why can't you save £40k in 3 years? Surely £40k in 10 years is a breeze. That is £333.33 per month. Or 30 boxes of cigarettes.

 

[keith]

When I brought the Ghibli I took advantage of the finance deal Maserati were offering:- 50% down the remainder in two years interest free.
Made a expensive car for me affordable.

 

[outrun]

I'm sure I read somewhere that almost 99% of new cars are financed now.

Should we have another recession, surely that leaves the car market on it's ar5e?

It's around 85% of new cars are financed. If you compare that to somewhere like Dubai, around 5% are financed, the rest are bought outright. That should give you an understanding of just how poor we have become in the UK.

I don't think we're heading for recession, for what that's worth. Brexit is causing uncertainty while the politicians postulate over the terms. While that is ongoing, people are naturally cautious. As soon as a deal is struck - no matter what that deal looks like - the uncertainty will shift and confidence will return. It happens to blue chip shares all the time, as soon as clarity is achieved, markets rally. Remove a CEO the city likes and the shares drop while he's replaced, get in a new guy and they rally back. Every time.

Add the Labour antisemitism row in and that fuels the problem further. So where we are is in a moment where the business community doesn't trust the Conservatives to get a decent deal for the country but they are far more scared of looney lefty Corbyn and what he could do if he gets power. Solve the Brexit deal and solve Jeremy and confidence will return from the top down.

In the car market, those than can afford 75k plus cars to add alongside others on their drive are not buying right now while they watch these key issues unfold. The middle market from 25k to 75k has been driven down because only those at the lower end are buying and so these cars are now pushing downwards to fit the buyer profile. It's not a new trend, happens in cycles and is directly related to confidence at the upper end of the market.

 

[Scaf]

All mine have been bought outright - mainly because if ever I lose my job I don’t want to have to change my lifestyle / sell cars I can’t to pay the loans on.

 

[Chrisb2015]

This is slightly apocalyptic isn’t it? The world won’t stop spinning because too many people finance a 320d. Whilst most on here can easily save the amounts you mention, we probably aren’t the most representative demographic given this is a Maserati forum.....