There are several reasons I can think of that are causing people to relook the possibility of leasing instead of owning a car.
But if you have been reading the posts on this site, you’ll find that we have questioned the move from ownership to leasing of vehicles. Whilst that may still hold true for the majority of Singaporeans, the shift, though small, is increasing and logically so.
Many want to have a vehicle they can call their own – it’s a mentality that many Singaporeans have held onto for the longest time. But viewed from another perspective, our system does not support ownership at all. Any so called ‘ownership’ is but temporal, for when that new car reaches the ten year mark, the owner has to face the dilemma of what many are feeling now, that is, the renewal of the COE for the next ten years. It’s that or the scrap yard. This current dilemma is pretty big right now, to the tune of over to $70,000.
To the scrap heap with this Picnic. I sympathise with the lament of its owner, a big waste.
Very ironic when our neighbours can continue to drive cars like these.
And many more comments from the disgruntled here.
So in fact, we are owning a 10 year lease for permission to drive our cars on the road.
And so, the logic of leasing a vehicle is coming to make more sense. For some of these reasons are obvious, like the expat that is here on a contract for two years, he knows exactly how long he needs the car and doesn’t want to face the headache of selling it while holding onto a ticket for that impending flight out of Singapore.
The Rest of Us
But those Singaporeans who are looking at the end of the 10 year ‘lease’ called COE, leasing is becoming a viable alternative. Why?
I know people who about 4 years ago, have bought cars when the COE was low and driven for three years to resell their car at a gain or minimal loss. Or maybe that statement should end with a ‘!’. It’s happened before and who’s to say it will not happen again?
There are reasons to expect a dip in COE prices to below the $50,000 level but I will not go into that here. Any predictions on COE are just that – predictions.
But, at the least, we have to admit, that COE levels fluctuate and so lower is a definite possibility. Given that scenario, would it not make sense to financial plan our car purchase till COEs are lower? After all, we do savings plans with insurance companies, purchase investment plans and trust funds that promise returns, why must car purchase be entered into in a haphazard manner?
Plan! Leasing now makes more sense, and if COE does fall to the estimate I have indicated in the upcoming 18 ~ 24 months, you’d have 1) leased for free, and 2) gotten a new car at the low end of COE levels, which 3) you may possibly sell again in years to come without loss!
Especially if there are budget leasing options here that you can have a basic car for transport for less than $900 a month, inclusive of road tax, maintenance, breakdown replacements and insurance*?! Find out more here and contact us for your quote.