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      10-24-2015, 02:34 PM   #1
omega3effect
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Anyone ever do a 24 Month Lease?

Hey All,
I heard that the new 5 series body is coming in 12-14 months? Is that correct? I assume the new m5 will be out 14-20 months from now? So, I was thinking of doing a 24 month lease on the current model. Anyone ever do a 24 month lease? Is it just a bad deal as the residuals aren't good? Any thoughts would be greatly appreciated!
Thanks!
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      10-26-2015, 07:22 AM   #2
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The next generation 5 series will be for the 2017 model year, which means they'll start showing up here in August 2016. The M5 launches one model year later, so 2018MY appearing in August 2017.

Generally, 24 month leases are not very good deals. The sweet spot for most leases is 36 months, although sometimes you'll see a great deal on a 39 month or something like that.

In my opinion, I'd go with the 36 month lease. You're better off financially, plus when the lease ends you'll be in the second model year of the new M5. As a general rule I try to avoid the first year of a new model. It was unavoidable for me on the F10 M5 and my 2013 M5 was missing a lot of nice features that showed up with the 2014 M5s.
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      10-26-2015, 01:26 PM   #3
omega3effect
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Thanks for the info! So the M5 will release a year after the 5 series launch? Not at the same time? I'm getting confused with all the auto magazine articles. I'm thinking 36 month regardless. Saw the new 7 series this past weekend -- some pretty crazy new technologies.
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      10-26-2015, 01:54 PM   #4
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Quote:
Originally Posted by omega3effect View Post
Thanks for the info! So the M5 will release a year after the 5 series launch? Not at the same time? I'm getting confused with all the auto magazine articles. I'm thinking 36 month regardless. Saw the new 7 series this past weekend -- some pretty crazy new technologies.
Listen to AGS, he's a good dude. M Cars never get released at the same time as regular BMW models.
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      10-26-2015, 02:54 PM   #5
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Quote:
Originally Posted by AGS View Post
The next generation 5 series will be for the 2017 model year, which means they'll start showing up here in August 2016. The M5 launches one model year later, so 2018MY appearing in August 2017.

Generally, 24 month leases are not very good deals. The sweet spot for most leases is 36 months, although sometimes you'll see a great deal on a 39 month or something like that.

In my opinion, I'd go with the 36 month lease. You're better off financially, plus when the lease ends you'll be in the second model year of the new M5. As a general rule I try to avoid the first year of a new model. It was unavoidable for me on the F10 M5 and my 2013 M5 was missing a lot of nice features that showed up with the 2014 M5s.
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      10-26-2015, 06:05 PM   #6
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Quote:
Originally Posted by RPiM5 View Post
Listen to AGS, he's a good dude.
Thanks Dave! I hope all's well with you and Mika.
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      10-29-2015, 06:49 PM   #7
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It just depends on the residual, I have seen instances where the 24 month residual was 10% higher than the 36 month. So as long as you are in a state where you don't have to pay full taxes on the car, a 24 month lease would make sense in that situation.
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      10-29-2015, 11:29 PM   #8
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I've done mostly 24 month leases.....key is to get the sweet spot length-wise. I'd rather pay $1,500 a month for 24 months than $1,400 month for 36.
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      10-29-2015, 11:35 PM   #9
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Quote:
Originally Posted by mjr24
I've done mostly 24 month leases.....key is to get the sweet spot length-wise. I'd rather pay $1,500 a month for 24 months than $1,400 month for 36.
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      10-30-2015, 12:34 AM   #10
omega3effect
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Thanks for your thoughts! I believe the current residuals are 62 for 36m and 68 for 24m... What do you guys think of that difference?
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      10-30-2015, 11:20 AM   #11
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Quote:
Originally Posted by omega3effect View Post
Thanks for your thoughts! I believe the current residuals are 62 for 36m and 68 for 24m... What do you guys think of that difference?
I don't know the details of your pricing. But that is probably about a $200 difference per month. Just depends if you want the third year or not.

If the $200 difference is correct, then you would be paying $4800 more at the 2 year mark. Which is probably a 4 - 5 month loss, depending on how much the 36 month lease is per month.

Last edited by dsad1; 10-30-2015 at 11:27 AM..
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      10-30-2015, 01:02 PM   #12
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Thanks! I haven't gotten pricing yet, but it sounds like a lot of $ to have a car for less time, haha!
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      10-30-2015, 01:37 PM   #13
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Quote:
Originally Posted by omega3effect View Post
Thanks! I haven't gotten pricing yet, but it sounds like a lot of $ to have a car for less time, haha!
Let's say your 36 month lease is $1000 a month. You would still need to pay $7k-$8k more for the last year. The question is if you will enjoy the car enough for that last year.

Financially unless there is at least a 10% difference in residual the 36 month will always be the better deal. It's just if it's worth it for you to pay for that third year or not.

I have always gone 36 months, but on this last car decided to go 24 months because I figured I wouldnt enjoy the car as much the third year. Even though the 36 month deal was better I didn't want to pay more for the extra months.

That being said this was a second/third car not my daily.
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      10-30-2015, 08:12 PM   #14
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Totally understand, I'm just coming out of a 36 month Active Hybrid 5, so 6 years of essentially a similar interior is kind of worrying me (this would be my daily driver). The 4% residual difference doesn't sound that hot. I was also considering a lease take over, or even an m6 to mix it up...
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      10-30-2015, 10:19 PM   #15
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Quote:
Originally Posted by omega3effect
Totally understand, I'm just coming out of a 36 month Active Hybrid 5, so 6 years of essentially a similar interior is kind of worrying me (this would be my daily driver). The 4% residual difference doesn't sound that hot. I was also considering a lease take over, or even an m6 to mix it up...
You can do a re-lease. I was offered an insane 24 month lease on a 9 month old M5 - dealers are allowed to lease such cars out with BMW programs. The payment was about $750 (IIRC) on a $130k sticker car. It was all black and I snoozed.

If you like 24 months, let your CA know. If you have a good relationship with your CA, he will probably drop you a line when a car comes in. I think it's ridiculous someone will change the car after a few months, but someone's loss / stupidity can be your gain.

Lease swap is another good idea. A friend of mine picked up a 22 month lease on a 550i xdrive for the same reason as what you mentioned (didn't want to be stuck in a F car when G is around the corner).

Hope this helps. Good luck.
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      10-30-2015, 11:44 PM   #16
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Wow, awesome deal. I'll have to look around for something like that! Yes, I'm looking at swaps now as well as getting prices for leases! Thanks for the info and thoughts!
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      11-05-2015, 08:52 AM   #17
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Quote:
Originally Posted by SuddenDebt View Post
E90potentialbuyer,

I was looking for low miles car so that I could re-lease but the pricing offered is not significantly different from MSRP.

For example, if the MSRP is $100k, I would expect that when the dealer bought back few month old car, they offered around $75k to a previous buyer. However, now that they are selling (re-lease) it again, they are doing it for around $96K. In your view, how much I should push them down approx. I am thinking of around $80k.

Thanks for your input
Is there any way for you to figure out what they bought back the car for? Are you able to see who the last owner was and contact him? If you could figure out what they bought it for and how long it has been sitting on their lot since then, that could very much help you determine how far down they would go.
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      11-05-2015, 08:53 AM   #18
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Quote:
Originally Posted by E90potentialbuyer View Post
You can do a re-lease. I was offered an insane 24 month lease on a 9 month old M5 - dealers are allowed to lease such cars out with BMW programs. The payment was about $750 (IIRC) on a $130k sticker car. It was all black and I snoozed.

If you like 24 months, let your CA know. If you have a good relationship with your CA, he will probably drop you a line when a car comes in. I think it's ridiculous someone will change the car after a few months, but someone's loss / stupidity can be your gain.

Lease swap is another good idea. A friend of mine picked up a 22 month lease on a 550i xdrive for the same reason as what you mentioned (didn't want to be stuck in a F car when G is around the corner).

Hope this helps. Good luck.
I was looking for low miles car so that I could re-lease but the pricing offered is not significantly different from MSRP.

For example, if the MSRP is $100k, I would expect that when the dealer bought back few month old car, they offered around $75k to a previous buyer. However, now that they are selling (re-lease) it again, they are doing it for around $96K. In your view, how much I should push them down approx. I am thinking of around $80k.

Also, is there any financial benefit in doing a 24 month lease on a 2015 brand new, asuuming the discounts are at least 15%. I think it can be pushed to 20%.

Thanks for your input

Last edited by SuddenDebt; 11-05-2015 at 09:06 AM..
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      11-05-2015, 08:57 AM   #19
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Quote:
Originally Posted by djsaad1 View Post
Is there any way for you to figure out what they bought back the car for? Are you able to see who the last owner was and contact him? If you could figure out what they bought it for and how long it has been sitting on their lot since then, that could very much help you determine how far down they would go.
Unfortunately, no and the dealer will never disclose this. However, we can use the average Trade-In market price as a baseline.

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      11-05-2015, 11:55 AM   #20
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Quote:
Originally Posted by SuddenDebt View Post
I was looking for low miles car so that I could re-lease but the pricing offered is not significantly different from MSRP.

For example, if the MSRP is $100k, I would expect that when the dealer bought back few month old car, they offered around $75k to a previous buyer. However, now that they are selling (re-lease) it again, they are doing it for around $96K. In your view, how much I should push them down approx. I am thinking of around $80k.

Also, is there any financial benefit in doing a 24 month lease on a 2015 brand new, asuuming the discounts are at least 15%. I think it can be pushed to 20%.

Thanks for your input
The answer is in your post. If they are selling it to you at $96K - I wouldn't touch it. a $100K MSRP 2015, is probably at least 15% (if not higher) on dealer lots. So there is absolutely no reason in the world you should use $96K as the cap cost - have to negotiate that down. $80K maybe doable.

If at all possible, I would recommend going for the brand new M5 instead of a few months old unless you know the oriignal driver and trust that he broke in the car properly...

If you are a BMWCCA member, you get another $1,000 off!
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      11-06-2015, 09:00 AM   #21
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Quote:
Originally Posted by E90potentialbuyer View Post
The answer is in your post. If they are selling it to you at $96K - I wouldn't touch it. a $100K MSRP 2015, is probably at least 15% (if not higher) on dealer lots. So there is absolutely no reason in the world you should use $96K as the cap cost - have to negotiate that down. $80K maybe doable.

If at all possible, I would recommend going for the brand new M5 instead of a few months old unless you know the oriignal driver and trust that he broke in the car properly...

If you are a BMWCCA member, you get another $1,000 off!
So a brand new 2015 car with 24 month lease seems to be a sweet spot, assuming at least 20% discount.

Not a BMWCCA member, but will get a UDE discount ($1k)

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      11-09-2015, 08:25 PM   #22
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Just fyi, the current 24 month residual on a 2016 7 series is 12% higher than the 36 month. In that situation it would only make sense to do a 24 month lease.

Every once in a while bmw messes with the numbers to make 24 more favorable.
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