The pros of buying a car
Vehicles are assets, hence are expected to depreciate. The moment a car is ignited and driven off, its net value shoots down by approximately 20% and will never gain what it has lost.
Over an extended period, purchasing a car is usually cheaper than leasing it. This is because after one has cleared his loan, he still has the asset which is of a given value.
The buyers have an assured authority over the car and can use it for whatever reason they wish. The owner is not strained to put the vehicle in a condition acceptable to a leaser.
At the point one has cleared all his installments, he is not obliged to carry any other costs other than maintenance and insurance.
The pros of leasing a car
The costs of renting a vehicle are far much less; hence drivers can drive vehicles that are out of their reach. If one is interested in the latest luxury automobiles after every few years, then the best option would be to lease. However, these advantages come with some tasks to bear, including being hit with fines for driving beyond the required mileage allowance and returning the car in a non-acceptable state.
For business purposes, vehicles that are leased benefit from the tax deductions hence reduction of costs as long as they are used for the purpose of the firm.
Companies also need nice looking cars so as to promote the overall outlook of themselves and this would be done better through leasing as it involves fewer costs than buying a new car after every 2 to 3 years.
Leasing a vehicle has the advantage of low repairing costs, reason being that the car is put under a factory warranty.
Another option at the disposal of the drivers is the lease to buy method. The idea here is that when the contract period is over, one has the option to purchase the vehicle according to the residue value or the value that the seller has assessed it to have. Naturally, before one makes a decision, he is bound to make comparisons between the net worth that the seller is proposing and the value of the vehicle in the market. A reliable source to get the market values of the cars would be the “True Market Value.” If the proposals of the dealer are higher than the value offered in the market, then it would be advisable to drop the project and move on to a more economical method.
In summary, buying tends to be favorable to those planning long-term ownership. On the other hand, leasing favors businesses which have to attract customers and cut costs. Leasing is also beneficial to individuals interested with new cars after short periods of time.