With the price of second-hand cars soaring in recent years and the cost of buying a new car seemingly out of reach for many young drivers, new data shows that leasing provides a cost-effective alternative with cheaper running costs, according to Leasing.com – the car leasing comparison website.
With a lower initial outlay – often less than £1,000 – and monthly costs mapped to driving habits (e.g agreed mileage), leasing enables young drivers to pick a new car without the worry of depreciation or the out-of-warranty repair bills associated with old run-around models, according to a statement from the comparison website.
Leasing.com analysed the market for the best value purchases on new and used cars for first-time motorists and compared them to their leasing equivalents to investigate which option can make your money stretch further.
Getting behind the wheel of a new Vauxhall Corsa, for example, could be £10,000 cheaper than buying it outright. And since manufacturer warranties, VED costs, fair wear and tear and breakdown assistance are all included in monthly rentals, young drivers could be set to save over £900 a year with a newer, more economical model parked on their drive.
An optional maintenance package for an additional monthly fee also removes another motoring headache helping new drivers to spread the cost of servicing bills,
Crucially for younger drivers, leasing a first car also helps to boost credit scores if budgeted and paid on time; a challenge many young people face when starting out.
Dave Timmis, Founder and CEO of Leasing.com, believes that young drivers, and their parents, will be buying smart in 2023:
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By GlobalData“With the economic climate teaching us to track our pennies, young drivers will be looking to save money when it comes to buying and running their first car. Gone are the days of garishly painted and unreliable first run-arounds, today’s first-time drivers are more interested in the latest tech and affordable monthly payments.
“Our data shows that personal leasing makes the latest new cars attainable with lower upfront costs, fixed monthly payments and other expenses already covered such as breakdown assistance and VED payments. Manufacturer new car warranties also give motorists peace of mind in the event of any mechanical issues, helping motorists to avoid unwanted repair bills.”
Leasing deals are based on an initial three-month rental on a 36-month contract with an annual 10,000 mileage allowance. Total maintenance costs for used and newly purchased vehicles have been based on KwikFit and RAC monthly estimates and combined into a total cost over 36 months for comparison with their leasing equivalent.
By leasing a car and following safe driving practices, young drivers may be able to reduce their financial burden and minimise the risk of accidents on the road, according to Distracted driving: a safety guide for responsible young drivers.
Consumer car finance new business volumes fell by 6% in December 2022: FLA
