Re: HCHII Lease $199/month
Yes, it takes a couple years and a LOT more than 12,000 miles/yr. to make a hybrid worth buying. People who drive only 1,000 miles per month should get a regular car.
Also, that $199 payment sounds good until you see the $3,400 down payment. I'll do the math here compared to my recent purchase of a 2007 HCH on a 3 year loan:
Lease -- $3,400 down, $200/mo x 36 months = $7,200 ---- total $10,600
Buy -- $0 down, $650/mo x 36 months = $23,400 ---- total $23,400
(the 'buy' total doesn't include the $2,100 tax credit, since that expires next month)
The price difference looks tempting, but remember, the lease's $10,600 price only covers 36,000 miles. That's 30 cents per mile. The buyer gets unlimited miles -- in my case 24,000 per year. So that's 33 cents per mile.
Also, at the end of the lease, you have nothing. You either have to give the car back to the dealer, or buy it at an inflated price, or lease another car. At the end of a purchase, you own a car, which you can either keep or sell.
If you keep it, the cost per mile drops dramatically. If you sell it, you re-coup a large percentage of your outlay.
Say that you sell your 3-year-old Civic Hybrid for $14,000 the day after you pay it off. That reduces the $23,400 cost to $9,400. That's less than the lease, and it leaves you with 14 grand in the bank, instead of no car and no money.
Now, certainly, if you leased the HCH and put that $400/month that you saved vs. the purchase into a bank account for 3 years, you'd have $14,000, too. But, first of all, no one here does that, because if they did, they'd all be millionaires, and would be leasing Lamborghinis, not Hondas. Second, the guy who leased would have driven much less than the guy who purchased, which goes to value.
The proverbial bottom line is that leasing is rarely a good deal for the average guy buying an average car. It's best for expensive or exotic cars that are difficult to sell on the used market. And leasing a hybrid is pointless because you need years and miles to justify the extra cost, anyway.
To put it another way, look at it from the dealer's point of view. To him, leasing is great! He gets you to pay him 11 grand to rent a car for 3 years. Then, he gets the car back with low mileage and in perfect condition (otherwise you pay him a fortune for extra miles or body damage). Then he gets to re-sell the car for full market value -- about $18,000 in this case. So he winds up making $30,000 on a $20,000 car.
That's why dealers are always pushing you to lease cars.
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Last edited by 1stpik : 12-14-2007 at 07:13 AM.
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