To answer this common question in South Africa, we have limited our response down to 5 quick reasons why leasing a car is the clever option and why you may want to consider leasing your next new ride.
Reason 1: Leasing a car is cheaper than buying one on a traditional HP agreement with a bank
Cars are seen as an investment by many buyers, and they are not cheap in South Africa, despite being a necessity for many people to carry out their day-to-day activities. Depending on the status of your credit rating score, your budget, and the reason you need a new car, leasing is generally the more economical option.
For example, if paying a large, non-refundable, deposit on a car through a HP agreement is not in your budget, then leasing the same car would cost much less per month than financing on a HP would. This means your monthly payments during the lease period will be much lower, and a lower monthly payment is critical for most SA motorists considering the impact of Covid-19 on our economy. Additionally, if you wish to buy the car after your leasing period ends, the price will be less than if you bought the same vehicle through a traditional dealer.
To compare leasing with a traditional HP agreement from a bank you must do an apple for apples comparison. Bear in mind that generally a lease includes more than just the cost of the vehicle and generally covers maintenance, tyres, tracking and licensing, with insurance being another key component.
Reason 2: Leasing a car is great for lower usage
If you just do not drive enough to justify the expense of purchasing a car via a traditional HP agreement, leasing is a great alternative. When you lease a car, it is common for the leasing company to calculate the lease cost charge, based on how much you intend to travel every month. This is usually measured in the kilometers you put on the vehicle. This gives you the flexibility to decide how much mileage you want to do every month and pay less when you use the vehicle less.
Reason 3: Variety is the spice of life
Variety is another reason why leasing a car is clever. Buying a new car is a commitment and a long term one at that, especially if you do not want to have to pay in for a shortfall when you want to change vehicles. And who is to say you will not fall in love with a different car months after you make your purchase? If you would like the flexibility to change vehicles more frequently and with less hassle, then leasing is your best option. Leasing allows you to experience driving a new car for an extended period. There is only so much you can learn from a test drive, after all. People who lease cars have the luxury of driving several different cars as if they were their own, and if having that variety sounds fun and exciting, then leasing is for you.
Reason 4: You will not have to sell your vehicle
One of the unfortunate facts of car ownership is that cars lose value very quickly and that selling tends to be a hassle. Furthermore, if you lack experience in buying and selling cars who is to say you are getting the best price, all of which contributes to what your vehicle actually cost you over it’s lifetime.
On the other hand, if you lease a car, it goes back to the leasing company after the leasing period ends with no risk to you at all apart from any non-fair wear and tear damage to the vehicle. At that point, you can either leave it at that, extend your lease, lease another car, or purchase the car you leased. Because you never have to sell the car, you do not have to be concerned with getting a fair price when you sell it and potentially losing money in the deal.
The luxury of not having to be concerned with your vehicle’s value and what it is costing to maintain and keep you on the road is another reason why leasing a car is the clever option.
Reason 5: You don’t have to worry about repairs and maintenance
Because the car is owned by the leasing company, the lease will cover a wide range of maintenance and tyre repairs. However, you will be held responsible for any damage that occurs due to poor driver behaviour or negligence. People who lease cars are expected to deliver their vehicle to approved repairer as appointed by the lease company for regular maintenance, while refraining from making any changes to the car or putting excess wear-and-tear on it; but as long as you treat the car as if it were your own you won’t get surprised with an unexpected and costly repair down the line.
Ready to learn more about why leasing a car is the clever option?
So, if you have been considering leasing a car for yourself, we at Pace Fleet Services hope we have answered your questions and addressed any concerns.
Used vehicle leasing is just one of the options we offer to get you behind the wheel of an affordable car, without taking on too much risk. We pride ourselves in making your dream car affordable, so give us a call on or contact us online today to find out which car rental, car leasing or rent to buy car option is best for you.