money factors and residuals
10-13-2018, 12:10 AM
#26
Senior Member
Shocking to see the residuals on this car after 3/36. But part of that is the game they play - anyone think that in 2021 they would be able to buy a 3 year old S560 lease return for 42% of the original cost? Not a chance, the sale price on a lease return would be dramatically higher than that 42% figure. I tried to buy a 3 year old S (from a dealer) in August 2017 and saw this game first hand, couldn't buy the car for anywhere near the lease residual. They figure that people who lease cars like this don't shop the payment much, so they soak them. Then they get the cars back off lease and markup that residual $20K and resell the same car again pre-owned with that marked up profit in it. Go try and buy a 3 year old 911 coming back off lease for anywhere near the residual it went out at - impossible on a clean car from a dealer, pre-owned price is dramatically higher. Only BMW gives a fair deal on this - the residuals the leased cars go out with match the pre-owned selling price when they come back, actually sometimes less.
The residual on these cars can go either way. Most of the time, leasing works out well for the s-class. My 2010 S550 (purchased) when we traded in for a 2015 S550, car was right around 3 years old. Leftover 2010 bought in 2011 and MY15 S was picked up in 2014. Trade in Value was 35k, 105 msrp. That’s like a 38% residual. The going price at dealers at the time was around 40k.
MY15 S550 Msrp was 120k. Residual 51% so around 61k. I went $5k over miles ~ 50k miles. I’m now at 56k. Trade in value was 47k from 3rd party. Imagine if you had some body/paint work. Be even less yet lease wouldn’t care. All in all, lease made sense for me so we are still in a 18 S560.
10-13-2018, 07:15 PM
#27
10-14-2018, 11:41 PM
#28
Senior Member
10-17-2018, 08:03 PM
#29
For me it would be around $18k or a bit more and .0066. Zero down. Depending on your driving I would go for 7500-10000 miles a year. You get better residuals and going over is cheap and can negotiated at the time when the dealer is trying to get you into another car. Which at 36 months is the same time of the year so the leverage will be on your side.
No problem to take the MF to retail. It’s a good rate either way. Keep in mind that residual has a larger impact on payments than MF.
I would also look for a similarly equipped car on cars.com to get a similar deal via phone/email. This will get you firm leverage over the (presumed) local car.
That said, you might have to wait another month or so to make sure that sufficient MY19 stock is in dealer inventories. Floor space is expensive and old cars are an anchor for dealers.
Year end will be better price-wise but inventory will be picked over with few desirable models left.
