Leasing is Up; Buyers Checking Re-sale value
Two pieces of news this week make it clear that the people in the market for a new car or truck have some opportunities to make their choice of leasing or buying more interesting.
First, leasing is coming back.
The latest data shows the percent of domestic cars and trucks being leased continues edging higher. It was up to 17.3% in the fourth quarter of last year. The highest point since leasing rates bottomed out at 10% in 2003. But it is still well below the high of 23% for leasing rates back in 1999. Leasing's comeback is due to a couple of changes in the industry. The first being the big 3 pulling back on the hefty incentives (0% for 60 months) the automakers used to push new car sales the last two years. Without those deals, the monthly payment for many new cars is higher for some buyers.
Meanwhile, the automakers are doing a better job of managing the residual values expected for vehicles when the come off their leases. That means the industry has a better shot at avoid the nasty downside effects it felt after leasing boom in the late 90's.
But while leasing is up, Kelley Blue Book has a new toolcar buyers will find helpful. It allows you to figure out the estimated value of your car, truck, or minivan at some point in the future - like when your loan is paid off. This is a great tool. Many people are constantly buying and selling cars and essentially making sure their monthly payments stay within a certain range. For them, and others, knowing the estimated value of their car could be a huge help in planning when to buy and sell vehicles in the future.
For too long, trying to figure out what a car might be worth as been the art of guessing, and often incorrectly. Kelley Blue Books new tool could go a long ways to removing the guesswork.
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