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pj8708

Bmw/infinity B.s. Or Fact

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I think luxury carbuyers definitely care about depreciation...

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I think luxury carbuyers definitely care about depreciation...

I know I do. Unless you just like to waste money, it just makes sense to factor in depreciation. It's also the one thing I always found the most difficult to determine on a lease.

Paul

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I think the key transition word here is "all" and "some". Do ALL luxury car buyers or SOME luxury car buyers care? I would have to say that some would be the truer statement. I think everyone has more or less the same list of considerations when buying a car, but each individual may have it listed in a different order of priority. I also think theres more than one type of "depreciation" to consider. For example, a Toyota 4Runner may cost $25k and will run forever and beyond and still be worth $10k in 5 years, and a Ford may cost $20K and only be worth $7k in 5 years, but if I'm only keeping it for 2 years then who cares? Get the Ford, save $5k, trade it in 2 years. Say they give you $3k less than the Toyota, your still $2k ahead. This is just a short simple example, and one I just chose to show how and why there would be good cause to go against what you might think to be a direct logic in buying, cause when it comes to cars, we buy based on desire and emotion, and not on logic and need. Atleast I'm able to admit that for myself.

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I care so much about depreciation that I refuse to purchase ANY vehicle until it is at least two and preferably three model years old. In my most recent transaction during the depths of the latest recession in December 2008, I managed to steal what was originally a $50,000 vehicle new for my ridiculous low-ball offer of $17,000. The car was in like-new condition with only 18,000 miles on it and a complete service history. Best vehicle deal I've ever done, and we're still enjoying that car very much (2005 Jaguar S-Type)....

So for me, not swallowing the bulk of the depreciation along with a minimum cost-of-ownership calculation is crucial....

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Even keeping the vehicle only 2-3 years depreciation still matters a lot, I think thats a significant reason luxury cars are leased at such a higher percentage than other types of cars...

Run lease payments on a Lexus and a Lincoln, the Lincoln is really unleasable unless its a subsidized lease (which Ford does all over the place) because the projected 3 year resale is so much lower.

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There is the old saying they always use in selling car lease's. "Never buy a depreciating asset." I always assumed that in this scenario, the word "asset" was an oxymoron.

I have always been curious as to why cars depreciate the way they do. Until the recent past, we could depend on our homes appreciating. The value of our spouse's jewelry increased over time. The value of our kids education brought them more value as time went on. Even our investments gave us a reasonable return as averaged out. The market is back up over 11,600.

But not our car. Who says a 05' ES is worth $14,000. Is it the auction house? Dealer? Buyer? KBB? Who steps up when that car hits the street and controls the fluctuation of the market. In my experience, I have never felt like it was me, the customer. I would really like to know someones learned opinion on this, for over the years, the car pricing game has always felt like a crap shoot. But there has to be a logical reason why the game has lasted so long and apparently worked so well.

As for leasing over buying, I have done both, and there are great benefits to both. If I was in business I might lease again. However, I don't like having payments all the time. I have also bought only two year old cars with service records to let someone else take that first 1/2 year hit on depreciation. I just bought a new car this year because I wanted that specific car. Go figure.

Paul

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There is the old saying they always use in selling car lease's. "Never buy a depreciating asset." I always assumed that in this scenario, the word "asset" was an oxymoron.

I have always been curious as to why cars depreciate the way they do. Until the recent past, we could depend on our homes appreciating. The value of our spouse's jewelry increased over time. The value of our kids education brought them more value as time went on. Even our investments gave us a reasonable return as averaged out. The market is back up over 11,600.

But not our car. Who says a 05' ES is worth $14,000. Is it the auction house? Dealer? Buyer? KBB? Who steps up when that car hits the street and controls the fluctuation of the market. In my experience, I have never felt like it was me, the customer. I would really like to know someones learned opinion on this, for over the years, the car pricing game has always felt like a crap shoot. But there has to be a logical reason why the game has lasted so long and apparently worked so well.

As for leasing over buying, I have done both, and there are great benefits to both. If I was in business I might lease again. However, I don't like having payments all the time. I have also bought only two year old cars with service records to let someone else take that first 1/2 year hit on depreciation. I just bought a new car this year because I wanted that specific car. Go figure.

Paul

And where I'm from, there's a saying "Never bring more money to the poker table than you can afford to lose." I just buy what I want and what makes the most sense to me and my life. I think for me then, I get a much higher satisfaction feeling per dollar spent then if I had a car that I felt I made to many compromises or not thought outs but had the "Higher resale" consolation prize.

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