Cars in Singapore is expensive due to due to many factors, mainly the Certificate of Entitlement (COE). A piece of paper which cost over 5 digit. But that doesn’t stop people from purchasing a vehicle. Both leasing and purchase has it own advantages. So when should you lease and when you should purchase a vehicle.
1) Are you prepared to place min. 40% down payment?
When you purchase a car in Singapore, you will be required to place a down payment of min. 40%. For example, the all new BMW 2 Series Gran Coupe retails at $157,888. A 40% down payment will equate to appromixately $65,000. A BMW 5 Series, retailing at $242,888 and 40% down payment will be appromixately $100,000. And that’s a lot of money. For leasing, it usually involve a refundable deposit which varies differently from companies and car model.
2) Are you one who love to change a car every few years?
Purchasing a car is a long term commitment (10 years). The decpreication is the highest for the first few years of every new car. To maximise the value of the car and lower the depreication per year, you will have to drive till the end. If you are keen to change a car, do take note that you it is best that you breakeven the loan amount with the selling value otherwise, you will have to top up the differences to the bank. For the exisiting car, you can either trade-in to the car dealer that you are keen to purchase your new vehicle, sell to a car dealer, or sell on SGCarMart yourself.
3) Repair and Maintenance
When you purchase a new car, it usually comes with free servicing and warranty. However, once the free servicing and warranty is over, you will need to pay for your servicing. For leasing, it is usaully taken care by the leasing company. So owners do not have to fork out more money for servicing and maintenance. For Thrifty Singapore, customers can be assured that quality will not be compromised as the vehicles are sent to Quick Lane Singapore, backed by the Sime Darby Motor Group, one of the biggest and most established names in Singapore’s motor trade.
4) Monthly Cost vs Monthly Installment
Leasing a car usually range from $1XXX monthly. However, Monthly Installment definitely be lower but it will varies according to the loan amount and period. Monthly installment is not the only cost that you have to take note of as there are other expenses; for example the yearly road tax and insurance. For first time owners, you wil not enjoy the No-Claim Discount(NCD) from the insurance company so you will have to have to pay a higher yearly premimum.
5) Total Cost
How much are you willing to pay in total? If you have the spare cash, purchasing a car will definitely save you more money in a long run. Leasing on the other hand cost slightly higher but you are paying for the convenience.
With all this information, have you identify which one suit your lifestyle more?
For any leasing enquiries, please email email@example.com.