The decision between buying and leasing a car is a tricky one. In 2024, this choice is even more pertinent due to shifting market dynamics and attractive manufacturer incentives. Drawing insights from CarEdge Co-Founder Ray Shefska, we delve into the nuances of buying versus leasing to help you make an informed decision.
Understanding Leasing in 2024
Leasing has traditionally been a popular option for drivers seeking lower monthly payments and the flexibility to change cars every few years. However, leasing fell out of favor during the pandemic era. In 2024, leasing is once again growing in popularity as drivers look to avoid the high interest rates that come with buying. There are also reasons why the dealers and car manufacturers themselves are fans of leasing.
Leasing keeps customers coming back to the dealership, more so than selling does. It’s also seen as a proven method of increasing brand loyalty. Ray highlights that many manufacturers are trying to increase the number of vehicles that are being leased due to the benefits it offers both dealerships and customers. Leasing ensures customers return at the end of their term, potentially increasing brand loyalty and dealership traffic.
Historically, leasing deals accounted for about 30% of all new car sales. However, this figure has recently dipped to around 17-18%. In response, manufacturers are rolling out aggressive leasing deals to climb out of the leasing slump. In early 2024, there’s an abundance of attractive lease offers for popular models.
First, let’s talk about whether buying or leasing makes sense for you.
The Benefits of Leasing a Car
Leasing in 2024 offers several advantages over buying:
- Lower Monthly Payments: Aggressive leasing deals can significantly reduce monthly payments, making it feasible for customers to opt for higher trim levels without stretching their budgets.
- Quality Used Inventory: The end of lease terms brings a wave of desirable used vehicles back to dealerships, benefiting the used car market with a supply of attractive options.
- Flexibility: Leasing allows consumers to enjoy the latest models every few years, along with the latest technology and safety features, without the long-term commitment of buying.
The Benefits of Buying a Car in 2024
Purchasing a vehicle outright continues to be a viable option for those looking for long-term value and ownership. These are the main advantages of buying instead of leasing:
- No Mileage Restrictions: Unlike leasing, buying a car frees you from mileage limits, making it ideal for those with high commute demands.
- Ownership Equity: Every payment made towards buying a car builds equity, eventually leading to outright ownership, which can be financially beneficial in the long run. Keep in mind that it’s never a smart idea to buy if you plan to sell within a few years. Depreciation hit’s hard, as car owners are finding out today.
- Freedom to Customize: Owning a car allows for personalization and modifications without the restrictions typically imposed by a lease agreement.
👉 If you’re looking for a complete, in-depth breakdown of leasing see the CarEdge Consumer’s Guide to Leasing in 2024.
Making the Right Choice
The decision to buy or lease in 2024 hinges on personal preferences, driving habits, and financial considerations. Ray advises, “Customers should check the manufacturer website and see what kind of sales and lease offers are available in their area before heading to the dealership.” Additionally, it’s crucial to check insurance costs before falling head over heels for any new car.
In 2024, whether to buy or lease a car depends on your individual needs and lifestyle. With manufacturers pushing more attractive lease deals, leasing may become a more appealing option for many. Leasing is a great way to avoid the worst effects of today’s high interest rates.
However, the long-term benefits of ownership and the freedom that comes with buying a car remain compelling factors. By carefully weighing the pros and cons and staying informed about current offers, you can make a decision that best suits your circumstances and ensures your satisfaction in the ever-changing automotive landscape.
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