You should check the incentives on Edmunds as they are specific to your zip code. They may very slightly from what I posted which were for SoCal. You can also confirm there the MF and Residual for the lease terms you need.
Cheers!
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I have yet to see a good argument as to why this is so. Payment to MSRP is a ratio, like P/E, it doesnât tell you everything, but is the best way Iâve seen to compare car deals. To put another way, what other cars could I get for the same payment/cost?
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Pinging @Audigirl
Who says that two cars offer a comparable value at the same msrp? Different manufacturers price their vehicles differently. Some inflate the MSRP and then offer large incentive packages to give the perception of a good deal. Others offer limited incentives, but have a lower starting msrp. Those limitations apply to one person, comparing two leases in a vacuum, and have nothing to do with the notion that a lease at 1% (or insert percent here) is a reasonable metric. There is some argument that can be made that directly comparing two vehicles for an individual person based on percent of MSRP has some value.
The notion that there is a specific % of MSRP that is a threshold for something being a good deal is a totally different conversation and is far further from being useful, as lease terms vary so wildly by personal situation. What incentives do you qualify for? What lease terms? What region are you in? What is your tax situation? Etc. You can have the same car sold to two different people, for the same pre-incentive selling price, for the same lease terms have payments that are off by hundreds of dollars from each other because of personal situation. You can have a situation where the same car, when adjusted for a personal situation, is impossible to get near 1% for one person and a horrible deal at 1% for another.
Letâs be very very clear that comparing two vehicles based on percent of MSRP and claiming that there is a specific percent of MSRP that represents a good deal are very different things.
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I understand all of what you said and still think youâre wrong. There are differences based on what folks qualify for, and thatâs why these differences should be accounted for when comparing cars.
As I said earlier, itâs similar to P/E and all the derivations. Some stocks have very high ratios for various reasons, but to argue P/E is useless would be pretty ridiculous.
Ultimately itâs up to they buyer to value each car based on the payment. If the OP values the $72k MSRP A6 over a $100k MSRP 7 series for the same payment, thatâs completely fine. But without doing the comparison, the OP probably wouldnât have considered the 7 series as an option.
Youâre arguing the idea of comparing two different vehicles based on their specific percent of MSRP as it applies to the specific buyer. That is a comparison that has some validity.
That is a different discussion than labeling a specific percent of MSRP and defining it as the threshold of a vehicle being a good deal or not.
Everyoneâs too busy trying to hit gross lol j/k⌠itâs Labor Day weekend⌠
Well Iâd say there are general thresholds. .5% will alway be great. .75% is usually great. 1% youâre not being ripped off, but unclear if itâs good. This could be debated though.
Over 1.25% is when you should at least consider other options.
The key is that most consumers use MSRP as a starting point anyway. They pick their favorite car with what they think is a reasonable MSRP, then try to get the best deal on that one car. The truth is that MSRP isnât a good predictor of actual lease payment cost, so consumers should compare actual costs, not msrps.
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Hereâs the problem: new people who have no idea what theyâre doing come here for info. They start reading and they see â1% means youâre getting a good deal!â and then they go off to a dealer and say âI want that $50k car for $500!â
Thereâs no attention paid to if thatâs a good deal or not. They could be leaving thousands of dollars on the table or they could be spinning their wheels trying for something unattainable.
1% is just a made up number. What is actually a good number for a specific vehicle varies so much based on vehicle, personal situation, lease terms, etc that to try to use that as a metric is completely useless.
I agree that as percent of MSRP approaches 0%, the deal is more and more likely to be a good deal, but what good does that do anyone? You cant use that to look at a specific deal and actually tell if itâs any good. To do so is just shooting in the dark and hoping for the best.
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Yes, couldnât agree more
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I donât think the 1% idea is useless, but there are some posters (not trusted ones) who literally say it is a ârule.â To say that itâs a âruleâ isnât terribly helpful, either. Using 1% as a shortcut also doesnât help people new to leasing learn that the fundamentals are pre-incentive selling price, rebates/incentives, RV, and MF.
With that kind of RV, itâs never going to be great (or even good) deal unless thereâs of incentives or rebates.
I get the wagon love (I have an inexpensive one myself), but, unless you can easily afford it, I think your idea to cross shop E-trons is a good one.
Ok, letâs challenge that assertion. What is it good for?
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For setting some sort of context. When I first joined the site (which was shortly before my car crapped out on me), I was totally confused by all the numbers being thrown around b/c itâs an overwhelming amount of info to proceess. â1%â (which I never took as a âruleâ) was a helpful figure for me to wrap my head around what a mainstream lease could be (and if my quote exceeded 1%, I needed to do some more digging to figure out what was going on).
As I have started to learn more about leasing, that number has less significance.
I would never endorse writing, âThat quote doesnât the meet the 1% rule! That deal sucks!â But, for most mainstreams cars, is there actually ever a situation where 1% is a TERRIBLE deal? Not everyone here is looking for a hack.
Again, my assertion is that the 1% idea (not rule) can be mildly helpful for a beginner as theyâre working to establish a more accurate framework for leasing. Would it be âbetterâ if that idea werenât floated at all? Probably. But once itâs out there on the interwebs, good luck eliminating itâŚ
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I think itâs because wagon is less popular in the US. E.g. Mercedes E wagon RF is 55%. Donât know why Audi Allroad RF is 51% though.
I think those are the kind of people this is most hurtful to. This gets looked at as a short cut to avoid taking the time to actually evaluate a deal. Someone reading for the first time that they can either compare to 1% or take the time to do the research are far more likely to choose the first and set themselves up for failure.
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I donât know much popularity goes into RV calculations. When I was looking at A4 Allroads in 2018, the RV was in the 60s for a 36 mo/ânormalâ mileages lease terms (high MF, though).
Well, I think that depends on how the rest of the community responds. While I donât think that 1% is useless, I also think itâs important for the community to explain why that figure can often be misleading (as it already does). But âmisleadingâ is different from (IMHO) âcompletely useless.â Not everyone is adept at math or enjoys hacking.
When 1% is mentioned and when the community responds that itâs not terribly accurate or sophisticated, then the OP gets to make the decision for themselves about how much more work they want to do.
Those of us who stick around clearly want to learn more. But there are likely many more who do not and such is their perogative. At least they still have possibly learned something mildly useful (having a vague âmetricâ and being fully informed about what that metric can and cannot do⌠Sometimes thatâs all someone can or wants to comprehend).
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A4 Allroad is not the same class as a full size wagon, though.
A6 AllRoad is comparable to E Wagon and V90âs, while the A4 is more like comparing to the C class wagon (which is not available in the US) and hence the RV will be different based on the class.
If you look at RV for E wagon, V90, V90 CC and Allroad A6, theyâre under 60% for 36/12.
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My biggest issue is that there is no one that benefits from hearing about the whole 1% concept. Best case scenario, they take the time to learn how to actually determine if something is a good deal or not. Worst case, they take it at face value and go off either overpaying or with unrealistic expectations.
So whatâs the point? It isnât useful as a vague metric in actually getting a good deal. It just sets someone trying learn back and it clouds the air with flawed data points for those that donât. Why start people off on the wrong foot?
My only comment is that in states like Texas with sales tax due on full value at lease, the 1% metric is harder to hit unless you evaluate it excluding tax.
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This thread has lost sight of the fact OP was quoted 1k/month on an A6. Broker time.
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