No it doesn’t but what I think he is saying is if you trade it in you wouldn’t have to pay sales tax. This isn’t totally correct though because in CA you are still paying sales tax on the monthly.
Here is the breakdown I came up with. You obviously don’t know how well you did until you sell and if nothing major needs repair outside the warranty. Basically, driving a Lexus NX for $375 to $450 a month depending on how long we keep it. It has very low miles for a 2018 and Lexus do keep their value better than most. This also gives us the flexibility to jump into a new NX 2022 or 2023 when the right deal comes along. Yes, you take a hit on sales tax with buying but there is also sales tax in CA on the payment per month. So a $600 lease per month you would pay $1,100 in sales tax over 24 months VS the buyout of $1,869.
This is a brave estimate. Not sure if there is data like that but a year ago 2 years old NX300 was valued at around $25k. Do you think in 2 years the same value will be for 5 years old unit?
I just found a quote from July 2020. 2 years old unit with 30k miles
And kiss that equity goodbye will be a great thing since we will be back to norm. Unless equity complete collapses in out used and leased vehicles and auto companies are still selling cars well above msrp. I dont think that’s possible you can’t have one without the other.
That would defy econ 101. Not saying it is not possible (our policymakers at this time are eager to screw the economy any way they see fit, so, i would not be shocked if they’d mandate a used car ceiling price, in the interest of ‘helping the poor’), but in normal, functioning capitalist economy where laws of supply and demand work, that won’t happen.
Yes, my cost to buy out the car is $9k - $11k for the next two years or $375 to $450 per month (including tax). Even in 2 years I feel good about being able to sell a low mileage premium trim AWD Lexus SUV.
This is not reflecting actual market condition for last several years. A year ago 2 years old nx300 was valued at $25 - 27k . Today 3 year old - the same unit is valued at $35k. Do You want to see “the slope” when this craziness will end? All happy byuers with overpaid cars in 4 years will end up with equity around 30% of original MSRP and own to the bank at least 50%. Everyone will try to roll in negative equity into next car.
I would argue this is the actual market conditions and the chip shortage won’t ease up until the end of next year. Cars will remain expensive for the foreseeable future.
Even when the chip shortage ends, there will be a couple years of “catch-up” where there’s not enough used cars available. Even if manufacturers start mass producing vehicles we will have had 18-36 months of limited production.
I don’t feel the market will return to normal for a couple more years.
I was in a similar situation but I sold and cleared $10k after selling my 2018 Jeep GC
When I first started the process of looking for a new car I had about $8k equity but by the time I found my next car a month later I found a dealer willing to pay $37xxx for the Jeep I owed $27xxx
I did a Volvo subscription which I started with only first months payment $800 insurance is included in that payment and I can turn the car in in just 4 months
So hoping inventory gets better
Msrp on the Volvo S60 is around $47k so my payment is high but hopefully I’ll find another car at around 4 months
But that $10k was just too juicy to pass up