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This was a good read but the section on cars is not right. They are a special kind of asset in that they depreciate incredibly fast, which makes leasing not so

This was a good read but the section on cars is not right. They are a special kind of asset in that they depreciate incredibly fast, which makes leasing not so much of a bad proposition. In places where interest rates are low, you might end up spending a mere 10-20% more, and in turn you don’t have to deal with insurance, maintenance or selling it at the end of the period.

OldTimeCoffee 5y ago
Leasing is still terrible unless you're a business replacing your vehicle on a schedule. If you buy a car new and keep it for a decade, you'll be ahead even including maintenance. Many dealerships offer free maintenance during the warranty period, then continue to offer free oil changes for as long as you own it. You have to carry insurance on a leased car at your own expense as well.
- vetinari 5y ago
  > You have to carry insurance on a leased car at your own expense as well. Not only that, you have to have a plan by insurer that the lessor has chosen (and yes, they do earn money here). With your own property, you can find your own deal.
- jnwatson 5y ago
  The devil is in the details. If you can predict how many miles you drive, it is essentially an agreement to sell your car at a predetermined price. The main problem is that when buying a car outright, there are two parameters the dealer can screw you with (price and interest rate.), with leasing, there is a third (sell price).
- ricardobeat 5y ago
  Indeed, the math falls apart getting 3-4 years in. Makes more sense for people who want to always have a relatively recent model.
calpaterson 5y ago
The lease usually takes into account the depreciation. Lessors aren't usually in the business of just eating the cost of depreciation. That said there are _some_ arguments in favour of leasing (https://www.reddit.com/r/slatestarcodex/comments/ow97zp/it_looks_like_a_product_but_is_secretly_a/h7gyfko/?context=3 https://www.reddit.com/r/slatestarcodex/comments/ow97zp/it_l...) but a) I don't think they're enormous and b) most people on a PCP don't really appreciate that it is a lease.

OldTimeCoffee 5y ago

Leasing is still terrible unless you're a business replacing your vehicle on a schedule. If you buy a car new and keep it for a decade, you'll be ahead even including maintenance. Many dealerships offer free maintenance during the warranty period, then continue to offer free oil changes for as long as you own it. You have to carry insurance on a leased car at your own expense as well.

vetinari 5y ago
> You have to carry insurance on a leased car at your own expense as well. Not only that, you have to have a plan by insurer that the lessor has chosen (and yes, they do earn money here). With your own property, you can find your own deal.
jnwatson 5y ago
The devil is in the details. If you can predict how many miles you drive, it is essentially an agreement to sell your car at a predetermined price. The main problem is that when buying a car outright, there are two parameters the dealer can screw you with (price and interest rate.), with leasing, there is a third (sell price).
ricardobeat 5y ago
Indeed, the math falls apart getting 3-4 years in. Makes more sense for people who want to always have a relatively recent model.

calpaterson 5y ago

The lease usually takes into account the depreciation. Lessors aren't usually in the business of just eating the cost of depreciation. That said there are _some_ arguments in favour of leasing (https://www.reddit.com/r/slatestarcodex/comments/ow97zp/it_looks_like_a_product_but_is_secretly_a/h7gyfko/?context=3 https://www.reddit.com/r/slatestarcodex/comments/ow97zp/it_l...) but a) I don't think they're enormous and b) most people on a PCP don't really appreciate that it is a lease.