The leasing market, from business fleets and luxury professional vehicles (you can take a look at some of the best deals on the market over at vantage-leasing.com) to economical consumer cars, is showing signs of considerable growth. Leasing has always been a hugely popular option, but why the sudden boom? In today's blog post, we'll consider just a few of the reasons for this...
1. Cars have become essential for young professionals
For anyone entering the job market or working their way up the ladder, cars have become essential. With most professional jobs based in city centres, but candidates unable to afford high rent prices, very few of these individuals will have a lump sum lying around to pay the deposit on a car or even buy it outright. As a result, the ability to lease a car with no deposit for low monthly payments has been a huge hit amongst this demographic, allowing them to broaden their search for work.
2. A better option for start-ups
In the digital age, there seem to be more and more start-ups, as entrepreneurs can set up full businesses with only a laptop, and this has certainly given the vehicle-leasing industry a boost. On the one hand, tax can be claimed back on the monthly running costs of the car if it is used for professional purposes, but the same cannot be said for a car loan, so it makes strong financial sense. On the other, the fact that there are no deposits required means such individuals don't need to worry about finding the capital for a professional, high-end vehicle, which will impress clients and help win contracts.
3. People don't mind monthly debits
These days, everything seems to be paid for by monthly direct debit, and people rarely see any ownership gain. More people are renting, taking out phone contracts, paying for Sky or Virgin television packages and so on - they don't often own any of these items, but it helps them to live the lifestyle they want more easily. This is now so common that the long-term investment of buying a car doesn't have the same appeal that it once did.
4. Better cars for less money
Finally, one of the most crucial aspects of the growth in leasing is that people see this option as a way of getting more for less, all without getting that painful depreciation in value. Renting a high-end vehicle for less money than buying an older car for high monthly payments is simply a more appealing option to most consumers. Plus, in some circumstances it makes a person financially better off; if you only intend to have the vehicle for a couple of years, and the depreciation on the car equates to more than the leasing payments, buying the car will mean you've lost money.
Albert Adam - 24 Jul 2017