Should You Lease Your Next Car? - Consumer Reports (2024)

Shopping for a new car means deciding between leasing and buying. In general, you’ll have a lower monthly payment if you lease, but you’ll pay less in the long run if you finance your new car—and you’ll save even more if you pay for the whole thing in cash.

But the decision isn’t all about cost. Leasing and buying offer unique benefits and drawbacks depending on your lifestyle and preferences. Would you enjoy getting a new car every three years for a predictable monthly payment without worrying about out-of-warranty repairs or the hassle of selling or trading it in? If so, you probably should consider leasing rather than buying. But if you plan to keep your car for a long time or expect to put a lot of miles on it, you’ll probably be better off buying.

With that in mind, we’ve got real-world examples of lease deals offered by automakers and exclusive Consumer Reports survey data to help you decide whether leasing or buying makes more sense for you this year.

When You Should Lease

You’re interested in a luxury car. Automakers often discount the cost of leasing a luxury car to attract new buyers to a brand. It can bring the monthly payment in line with what it would cost to finance a less-pricey vehicle, Libby says. But be aware that specific options and trims aren’t always available on a discounted lease deal.

You want a car with the latest features. "New cars often have the latest safety equipment and better crash protection than older models," says Jennifer Stockburger, operations manager at CR’s Auto Test Center. "If you go from lease to lease, you’ll always have a late-model car with the most current safety features."

When You Should Buy

In the situations that follow, buying—either financing or purchasing a vehicle outright—makes more sense.

You drive a lot or put a lot of wear and tear on your car. Most leases cap how many miles you can drive—usually 10,000 to 15,000 per year—and will charge you 10 to 30 cents for every mile you go over your limit. For many people, that’s not enough mileage. Leased cars also have to be returned in good condition as part of the contract, so if you have a messy pet or tend to attract dings and dents, you’re better off buying.

You plan to keep the car for a long time. You’ll have no monthly payments after your car is paid off, but it will still have resale value. By contrast, you’re left with nothing when a lease is up. "Are you then prepared to go into another lease with another down payment and potentially higher monthly payments if you don’t put a lot down?" asks Melinda Zabritski, senior director of the financial solutions team at Experian Automotive.

Your needs may change in a year or two. "It’s hard to get out of a lease before its term is up," says Gabe Shenhar, associate director of the CR Auto Test Center. Buying makes more sense if you think your needs may change—if, say, you expect to need a larger car or you may have to drive more miles than a lease may allow.

Why It's Smart to Lease an EV

According to the data analytics company Experian, 30.7 percent of EV drivers chose a lease in 2023, up from just 9.8 percent in 2022. It’s easy to see why. Lessees can qualify for a federal tax credit of up to $7,500 without meeting restrictive requirements on where an EV or PHEV was made, how much it cost, or the lessee’s income—all of which apply to purchases. Some automakers also discount leases on EVs and PHEVs to help sell vehicles that meet emissions rules.

Leasing an EV makes sense for other reasons, too, says Jake Fisher, CR’s senior director of auto testing.

"Prices and rebates on EVs have been fluctuating quite widely, making resale values impossible to predict," he says. For example, both Ford and Tesla have recently cut the prices of some of their EVs by thousands of dollars. "But if you lease an EV that depreciates significantly over the next few years, what it’s worth at the end of the lease isn’t your problem."

In addition, EV technology is advancing so rapidly that today’s EVs may end up obsolete in a decade. Battery ranges are growing, charging standards and speeds are changing, and purchase prices are dropping, Fisher says. "If you bought an EV a couple of years ago, it might not even be capable of the fastest kind of fast charging," he says, "whereas the newer vehicles have larger batteries, faster charging, and may cost less."

These Cars Might Be Better to Lease

If you’ve got your heart set on a fun-to-drive vehicle even though it scores below average in CR’s reliability ratings, leasing may be the way to go, says Steven Elek, program leader for automotive data analytics at CR. "While it still may be a hassle to bring an unreliable vehicle to the dealer for repairs, at least it’s under warranty while you’re driving it," he says. "Then it’s somebody else’s headache when you turn it in at the end of a lease."

The much-loved vehicles below have high road-test and owner satisfaction scores but lower-than-average reliability. It would be better to lease one rather than buy—but only if you can find a good deal that also makes financial sense.