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Those familiar with the auto industry will know that leasing is becoming an increasingly common way of financing a vehicle. Not only does leasing not require the large initial outlay demanded by buying outright, it is also largely exempt from the sky-high interest rates charged by banks when taking out a loan for a car. Many people cite leasing to be a no-brainer since it avoids the massive depreciation that cars suffer when they are driven out the show rooms. As J.Paul Getty, the billionaire oil tycoon once said ‘if it appreciates, buy it, it depreciates, lease it’.

So, when it comes to your average family which loses approximately half its value upon leaving the showroom, the choice is simple. Not all cars are created equal however, what of Ferraris and Lamborghinis equipped with that cost thousands of pounds worth of car accessories? It is a well known fact that some rare cars can actually appreciate in value, simply because there is such a demand. Such cars don’t have to have a ‘prestige’ badge either, the Ford Focus RS which was released in 2009 was last year attracting 2^nd hand prices around five thousand pounds more expensive than the list price.

In this case, leasing would not make sense, an outright purchase could actually yield an attractive profit. So where does leasing fit into the luxury car market? Luxury car leasing is still a viable option a high-end car. The market is however more consumer driven, this is because those looking to spend possibly hundreds of thousands of pounds on leasing a car aren’t as price focused, they’re more worried about quality and service, meaning they will choose their dealer very carefully.

If we take into account depreciation, leasing becomes an even more efficient finance option when it comes to luxury cars than it is for regular vehicles. This is because the differential between the list price and the residual value of say, an Aston Martin DB7 is much greater than that of a Ford Fiesta. In layman’s terms this means if a Fiesta is brought for ten thousand pounds it is likely to be worth around £7,000 after three years, a £3000 loss. A DB7 costing £150,000 on the other hand could only be worth around £75,000 after the same period of time, a 50% drop in value.

This is why leasing a luxury car is even more valuable than a ‘regular’ car, you will end up losing more money in the long run by buying, and then selling. Leasing once again proves itself to be THE only option when it comes to vehicle finance.