Should you buy the car at the end of your auto lease? Not before doing your homework. Often, the post-lease purchase price, also known as the “residual value,” is $3,000 to $4,000 more than the actual market value of the car.
Why? Because market values of used cars are plunging. Back in 1999, a record number of cars went on 36-month leases. As those cars go off-lease, supply exceeds demand and prices are falling.
Your best bet might be to wait until the very end of the lease and ask the leasing company if you can pay a lower price for the car. Do some shopping around to get an idea of market value. In some cases, the leasing company will give you a price break rather than take its chances selling at a wholesale auction.
If you don’t get a good price, walk away. Either rent a new car or go buy a used car on your own.