I have been leasing cars since I got a good one on an Accord in 96. Since then I had Accords, Acura,Audi, Mercedes, Lexus, Volvo. I got for the sharp deals. One rule of thumb I have always used is as follows. If the lease is 10% or less than than the MSRP (Effective Payment)(YEARLY NOT MONTHLY), no cap cost stuff, basically rolling all in including the bank fee, then the lease has good value. That doesnt say I dont look at all the numbers, merely the initial view of things. Now I cannot recall every lease, that would be impossible. But I am very sure since I have been leasing Audi, Mercedes, Lexus, Volvo I have been well under that 10%. I am very sure I never paid over that 10% in earlier leases, if I did a very small amount. Now that Leasehacker has a database of signed deals, if you look at them, you will see that leases scoring 7.5 or higher (probably 8 average) all are at or under my 10% rule of thumb. Leases that score 10 or more are all under that 10% (some by a nice margin). I dont count MSDS which I have done with Volvo, Lexus. I think my Mercedes at the time was a one pay. I remember that as an E-Class sticker over 60K and that lease was 489 W/Tax If I remember correctly. When I returnd the car the dealer was talking 800-900 or more for another lease. I have no loyalty other than to a sharp deal. I have two S90 Inscriptions (2020) 449/M with tax and MSDS that is ending shortly. Looks like this is the end of the line for me and Volvo. I dont find their leasing company particularly consumer friendly either, but that doesnt factor in to my decision. The timing is bad because I think by the time we hit fall the 2024 are coming out and the car market may be cooling a bit. I will say over the years the best leasing company was Honda/Acura and the lesser ones (and dealing with service as well) Audi, Volvo, Mercedes. Lexus average. I find the service debt pretty arrogant at Audi, and Mercedes, Lexus we have the biggest dealer in the US here. They talk big, but their service dept is mediocre at best.
I think we can all agree that a lease should be under 10% of msrp per month. A $6500/mo lease on a $65k volvo s90 is definitely pushing what id be comfortable with.
I bet you’d become best friends with the GM and be invited on his new boat!
It’s safe down here everyone
I think they mean 10% of the Msrp yearly which would translate to a hackr score of ~10yrs
Interesting number but good luck getting there with rates and residuals where they are on most lines that people actually want to drive.
Oh right. Taxes and fees.
Still lofty but we’re definitely approaching that.
Ah yes, the part of a % of msrp rule where we pretend that there isnt a difference of thousands of dollars between different states
My rule of thumb before ever joining this site was the payment needed to be minimum of $100 less a month versus a 5 year loan, preferably $150 to even be considered a good deal.
Joe I checked that on a lease my business partner was quoted. $100 is way too low. $150.00 I think makes bad leases look good. I think $150 is too easy.
Frankly thousands of dollars between states doesnt matter to me. Because like the dealers I have no loyalty. I am mercenary. If you can get a Volvo for example for alot less than me (In South FLA) I am not going with Volvo. Because I am comparing the deal with a car in the same class/price range.
And again going back merely to what I state for me, using that quick rule It matches the leasehacker scores. In the past you had to search and click on individual deals. With the database its easy to see. Some people may not care but to me anything in the 5-6 score range is definitely a fleece. Cars that are 15% MSRP are definitely not something I would seek. Things definitely change as do the needs of the customer. These days I dont drive much and only need a 7500/yr lease. I look at this two ways, pay cash outright or lease. I havent paid cash in a while since I got some great leases since maybe 2012. Very strong programs. If the Tesla leases were sharper I would consider them. Currently their structure is better to buy vs lease. As I always say dont love anything that cant love you back. The leases I got on the luxury brands, made alot of sense to lease vs buy due to high costs to maintain those cars.
This is what I mean. MSRP 50K for example. Monthly Payment $500. Look in the LH scores. My best leases have been at that number or lower. Most lower. I have never paid 700.00 for example (+200) for that 50K car.
I didnt get my point across properly. Monthy payment 50K car, 500.
I meant yearly not monthly. 60K car roughly 600/m or less.
So your rule of thumb is just the 1% rule, the gold standard.
So is it 10% or 12%?
Wait did you just open a new thread to give us the most long-winded explanation of your personal adherence and dedication to the 1% rule?
I feel so fleeced right now. When I clicked this thread, I was so sure I was about to learn about a sweet new rule of leasing that I hadn’t heard of before. You dirty dog.
I didn’t think this could get worse but it did.
Yep a huge controvery. Something to get bent out of shape over. But since you are the expert feel free to go to the database and show me some leases with 7.5 or higher to prove me wrong. You are just hung up on the fact I didnt make things clear. 10% approx of the MSRP divided/12. If any person off the street walked into a car dealer not understanding leasing and they gave that person a single rolled in number like I press for and those numbers fall into that range, the person wont get a fleece. They wont pay 417 for a Honda Accord. Even if there is a better price out there, they wont get completely burned.