Leasing a used vehicle is indeed a viable option, although it’s important to note that not every dealership offers this service. The process requires some patience and effort, as you may need to contact various dealerships to find one that provides leases on used cars. The reason for the rarity of this option is the risk associated with predicting the future value of a used car, which can be more variable than that of a new car.
When you do find a dealership that offers used car leasing, it can be an excellent way to access a newer model at a more affordable rate than buying new. Many leased used cars are certified pre-owned, which often includes the benefit of a warranty. Additionally, you might find vehicles with enhanced features or higher trim levels for a better value.
Recent market studies have provided insights into the used car market dynamics. In the third quarter of 2023, the average transaction price (ATP) for used vehicles dropped by 5.5 percent compared to the same quarter in the previous year. This decline is notable, especially when considering that in August, the proportion of used cars priced under $20,000 decreased to 12.4 percent from 49.3 percent in 2019, signaling a shift towards more traditional market patterns.
The gap in pricing between new and almost-new used vehicles is also widening. Typically, a new vehicle loses value quickly with even minimal use. However, during recent market disruptions, “nearly-new” used vehicles were priced almost as high as new ones. There’s now an average difference of $13,686 in price between new cars and used cars under three years old. In September 2023, the prices for used cars up to 36 months old saw a year-over-year decrease of 4.8 percent.
Despite these trends, the return to a stable, pre-pandemic used car market is not guaranteed. The demand for pre-owned vehicles remains high, leading to quick sales as soon as they are available. This high demand keeps prices elevated; in 2023, cars with a certain age and mileage were about $10,000 more expensive than in 2019. Furthermore, the quick sale of newer, lower-mileage cars means that the average used car on the market is now older and has higher mileage than it did four years ago.
As we step into 2024, the question of whether leasing a car is a sensible choice remains a relevant and complex decision for many consumers. The automotive landscape continues to evolve with technological advancements, economic shifts, and changing consumer preferences. In this context, leasing a car, as opposed to purchasing it outright or opting for alternative transportation methods, requires a thoughtful assessment of various factors including personal financial circumstances, driving habits, and future market predictions. This article aims to explore the pros and cons of car leasing in the current year, delving into the latest trends in the auto industry, the financial implications of leasing versus buying, and how shifts in consumer lifestyles and preferences might influence this decision. Whether you’re a long-time lessee considering your next move or a first-time car user weighing your options, understanding the nuances of car leasing in 2024 is crucial to making an informed decision that aligns with your personal and financial goals.