Finance vs lease car the finance vs lease car shift is

The finance vs lease car shift is quantified in sector-wide price-to-book ratios, with leasing-focused firms averaging 1.28 versus 0.92 for finance-heavy peers. Equity strategists flag this as a near-term buy signal in auto equities. You want lower monthly payments. Average car payments on a leased vehicle were $638 per month in the second quarter of 2024, Experian reports. New car loan payments averaged $655 per month in the same period. If demand for used EVs is high at the end of your lease, resale values may be higher than expected, and it may make sense to purchase the car for the buyout value that’s written into the lease contract. “If the automaker underestimates the resale value, you can buy the car and have equity, or sell it for a profit,” says Fisher. That’s what many lessees were able to do when used-car values soared early during the pandemic. But if similar cars are selling for less than the buyout amount written into your lease—or if the new crop of EVs are better than the leased one you’re turning in—it’s smart to walk away. In technical stock analysis, finance vs lease car adoption rates are emerging as a sector momentum driver. Breakout patterns are forming in charts of leasing-heavy auto stocks, suggesting potential upside moves within the next earnings cycle.