I'm in the market for a car too, and have noticed a lot of financing deals being advertised. We're considering a Subaru, Honda, or Volkswagon. Admittedly I get confused whether it's better to buy new or a 2-3 year old car coming off a lease. We thought we would do the latter, but those makes don't really seem to lose much value and I can't tell whether the cars I see advertised are a good deal. If a used car is only $2k less than a new one and that savings could potentially be eaten up by new tires, brakes, etc., then what is the point? Not sure what the best answer is.

I think PPs are thinking that because a car is a depreciating asset, it shouldn't be considered an asset at all. That's not smart in my opinion.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Throw money away so you have no equity or long term commitment to anything? Sounds like the perfect strategy to market to millennials.

If you can't afford the car buy something cheaper. Unless you're writing off for business no one should lease a car. Ever.

How much equity can you really get from a car?

My point exactly! Cars offer ZERO equity, unless it is some rare, exotic model.

So if you buy a car and own it free and clear (either up front or 3 years from now), you have no equity in it? You can sell it for cash, or trade it in, whatever. I am driving an 11 year old car that is still worth maybe $3-4k, requires maybe $500 of maintenance a year, and I can either run it into the ground or trade it in for something else and write a smaller check. Sure you know what the definition of equity is?

Anonymous wrote:I think PP's point was that with a purchase, at some point you own the car outright. The benefit is the years you get to drive it while paying nothing but maintenance.

I own my cars, drive them forever, and have always subscribed to this view, but someone on a similar thread last year posted an interesting analysis of why my view may be outmoded given some current favorable lease terms out there. I don't remember the details, and I still own my 10+ year old cars, but apparently there may be favorable leases out there, depending on the #'s.

I'd love to see that. Bottom line the issue is cost to operate the vehicle. You can measure it by month or by mile. There is no way you can convince me it is cheaper to lease a new car than to buy outright (or finance with low interest rates) a 2-3 year old quality used car.