First and foremost, love the forum and very interesting to see what kind of deals are available. I’m looking for some ideas for my next lease as my current lease comes due in May. Here’s my situation:
Current car:
2016 BMW 428i Gran Coupe (more or less fully loaded - $55.6K MSRP)
12K miles per year; I paid first month and registration at signing; $589/mo. (including tax)
Current Mileage: 13K and will likely end my lease at 15K miles (my daily commute is very short as explained below)
Current Situation:
My total commute to and from work is less than 5 miles per day so I’m significantly under mileage (13K now and will likely end under 15K). I live in Los Angeles so occasionally I will drive down to OC or San Diego but nothing major. I thought about purchasing my lease but the residual is higher than I would like at $33K. Further I looked up my car’s value on KBB and it doesn’t look like the market price is any higher so even with the low mileage, I don’t think it’s worth buying the car out.
My Options
Given my commute is so short, I would like to get into a cheaper lease. Ideally in the $300 - $350 range w/ nothing DAS, OK if I had to put some security deposits down. Would also prefer to have a decent sized car as I often drive family around but it doesn’t have to be huge. I know I’ll likely have to downgrade my car but wanted to get some ideas from ya’ll experts. Here’s what I was thinking:
Stay with BMW (to avoid lease return fees, etc.) and try to find a lease deal on a loaner @ 7.5K miles per year (not sure if they even offer these kinds of leases)
Try to find a similar lease deal on a loaner from another German car maker (e.g., Benz, Audi)
Find a 12-24 month lease to step into off SwapALease or LeaseTrader for ~$350/mo. (anyone have experience with this?)
Get into a cheaper option w/ Lexus or Infiniti
I probably will rule out any American cars and coupes. Nothing wrong with them just my personal preference.
Swapalease is a great option as you as there are people trending significantly over per their lease allowance and need to dump the car. May take a few weeks and some negotiation, but should be able to find a lease with 15-25 months left with 200-300 miles per month which should be plenty for you.
You would likely need to get a significant incentive to take the lease due to the limited mileage and also difficult for people to understand/accept they signed a terrible lease initially. Just take a similar car with the correct monthly mileage average at a good price and subtract .15 or .25 per mile you are missing to determine a fair incentive.
You should have no problem getting a 3 series for $300 or even below but just may take some time to find the right car (locally preferred) and someone who agrees with your analysis.
Keep in mind that the transfer could take 2-3 weeks plus registration/titling which can’t take place until the transfer is complete so give a month or so leadtime.
IMO: if you are set on luxury type vehicles, you are far better off buying a pre-owned vehicle than leasing if you are interested in saving money. Leasing rarely makes sense if you drive very little or a lot. If you insist on leasing, look for a lease transfer with very low remaining mileage - they are hard to get rid of, so sellers should be incentivizing them heavily. You should easily be able to get a 3er or 4er lease swap for your price that has 400-500 miles/month remaining.
By paying for 36k miles and only using 15k miles, you are paying a tremendous amount of money for mileage depreciation that you are not using and never going to use. This is far more than you would pay for an extended warranty on a used vehicle or any potential maintenance/repairs. You’ve paid ~$22k to drive 15,000 miles. That’s really, really rough for an entry level luxury vehicle.
Here’s a CPO 428i listed for the price of your current total lease cost, it should last more than 15k miles (It’s probably not ‘more or less fully loaded’ but you get the point);
Technically, there is not a tremendous amount of money lost due to his unused mileage, rather just depreciation of the vehicle solely based on age which would happen to a new car that was purchased or leased. Actual mileage (outside of the extremes) has a minor impact on the overall resell value and think we put too much emphasis on leftover miles especially since most cars are underwater when they are turned in anyway. KBB estimates about $1,800 difference for his car with 15K vs. 36K miles so $50/month.
Leasing vs. buying is always a personal preference and no right or wrong answer. The example you provided is a 5 year old car with 35K so like comparing apples to oranges. It’s two years older than the car he has today that is about to be turned in. Also, maybe he just enjoys having a new car with the latest bells and whistles.
The right comparison would be buying the same car outright vs. leasing and don’t think he would be in a significantly better position after 3 years owning the car vs leasing even if he only had 15K on it and signed a 30K lease. He would have paid the entire tax bill and still have to resell it and the hassle that comes with that. If he planned on running it into the ground, that’s a different story.
@jy1022 - Some manufacturers do 7,500 miles/year leases like Acura & Audi (BMW does not), but it’s not going to save you a ton as it’s typically just a 1% increase to residual ($500-$600 total over 3 years) vs. a 10K lease. If you like your BMW, I suggest you stick with them and focus on best possible deal you can get, potential a loaner as suggested or lower end model. If you follow this board and/or hire a broker, you can probably get a better deal than you would have done on your own which can easily offset the “wasted” mileage. If you are patient and have flexibility on colors/options maybe you can run into a unicorn deal like this and then the mileage is irrelevant:
I don’t know what your deal is with strawman arguments and semantics - nowhere did I suggest that he should have bought this new instead of leasing. I suggested that he should look at pre owned models because he will get much more vehicle for less money since he is not paying for nearly as much time depreciation as you brought up. And driving so little, he really doesn’t have to worry about huge repair or maintenance bills that make leasing so attractive. There is precisely no real difference between a 2015 and a 2018 4GC. The ladies also don’t care what year it is.
OP seemed very concerned with monthly payment and saving money so I suggested a way to save a lot of money. OP can make up his own mind and do whatever he fancies with the information and suggestion provided.
Sorry… 416 miles vs. a guesstimate of 200-300 had a monumental impact in the discussion so good you chimed in there.
Of course, buying a used car will make better financial sense 99.9% of the time. Think you may be too practical for this forum where a majority posts are about $65k+ luxury cars.
Outside of questioning your comparison, my point was not using up a large portion of your mileage does not have huge financial ramification as one would think.
Just his BMW loyalty discount can almost can offset that “cost” so shouldn’t rule out leasing but maybe look at lower MSRP cars with good residuals/incentives if he wants to be more practical and it’s ok to turn in a car under mileage.
For people who don’t drive much, I think the most reasonable thing to do is buy new and own it for the length of the longest OEM extended warranty rangjng from eight (Honda, Toyota, etc) to ten years (Hyundai, Kia, etc).
A one-owner car with, say, 45K miles and a year remaining on the OEM warranty can be worth many thousands of dollars on the private market.
Purchase price + TTL plus maybe one set of tires + essentially zero repair costs less resale value = say 27k over nine years is only $250/month
Thanks everyone for the quick input. I wasn’t aware that BMW did not do 7.5K mile lease deals on some of their lower-end cars. Yeah unfortunately when I first leased the car, I was living somewhere else where my daily commute was significantly higher. I’ve moved much closer so obviously that cut miles down significantly but nonetheless coming near to the end of my lease.
I’ll be the first to admit, I do enjoy the bells and whistles of a new car so I’ll probably pass on purchasing a CPO (despite it being the most practical option here). @Britten440 i like the idea of staying posted on this board or even hiring a broker to help me do the leg work. Was not even aware there was a broker for lease deals - do you know how you source a good one? I’m crossing my fingers to find that unicorn deal. To me, sticking with BMW is probably the “simplest” (i.e., least time consuming) route.
in your situation I would definitely use a reliable broker that can be found all over the forums. I see @autopia and @legendsauto and @LeaseHero posting all sorts of BMW deals for socal. Granted most of them are loaners or demos so if you want a non-loaner/demo I would contact them directly to see what sort of non-loaner/demo deals you can get. Use the forums as a tool to gauge their reliability and get a general sense of which car you want (e.g. price range). I personally have used Paul @legendsauto for my wife’s x2 and have been a happy camper.
Spend some time on the forum… tons of BMW deals discussed and brokers available (at a fee of course). @BMW_Dave is a great person to follow as he’s at a dealership by you and always posting deals.
Feel free to email me directly if you decide to stay with BMW (I don’t check PM’s very often at all) although the budget you working with ($300-350 with $0 DAS) will probably limit you specifically to a 320 or X2 loaner.
Keep in mind that I work for BMW so there wouldn’t be a broker fee (Sorry guys. Just a simple fact). I’d beat any new car quote on a comparable new car but the loaners are case by case. If I don’t have the right loaner car than the broker angle may work out better.
I have more reviews than any BMW Client Advisor in CA so you can clearly see what my past customers have experienced and what you can expect. My Reviews
I am also happy to help with loaners/demos and new vehicles alike! As you can see with my previous post history, my prices are some of the lowest and are hard to beat! BMW does not do 7.5k mile leases on cars other than the 7 series and a few M vehicles, but I do think sticking to BMW for your next lease is a good move as you save the disposition fee and can take advantage of BMW’s aggressive loyalty programs.
I didn’t see it mentioned here but with the combo of a short commute, living in Cali, and already owning a BMW then an electric/hybrid vehicle would be a very good choice if you can charge at home or at work. Most gas vehicles do not tend to do well longer term with very short journeys, it’ll be easier on the vehicle with the Socal weather but your situation seems to be perfect for an i3, 330e, etc. You get a lot of fringe benefits as well going that route in Cali.
@LeaseHero and @legendsauto, are you guys considered brokers or w/ BMW? Reason I ask is I have a few more months before my lease ends so want to know if there are any options to turn in my lease early. Loaners would probably be good for my situation so I want to start the hunt early so I can find the right loaner.
@BMW_Dave thanks! I do have some flexibility with my monthly payment and DAS. I’ll email you directly with all my specific details.
@ajgraham that’s a good idea. I don’t think 330e’s qualify for anything in California anymore though. I think it’ll have to be a 530e in order to get HOV and federal credit.
