Received residuals from dealer

My dealer in miami called me today with Cayman S residuals. Money factor = .00350 36 months--55% 39 months--53% 48 months--47% Can anyone confirm these numbers?? Are you willing to buy or lease?

<p class="MsoNormal" style="MARGIN: 0in 0in 0pt">J. Paul Getty said “if it appreciates buy it, if it depreciates lease it”. However I’m thinking purchase because I don’t know how long I’ll keep it but it will probably be longer than most lease terms and I think I’ll enjoy the satisfaction of [/quote]owning. But I’m still working the problem. I cannot confirm the quoted numbers but the finance guy at the dealership still believes there is something special for the Cayman on the horizon. I know Woodhouse doesn’t and he has more information than my local dealer I wager.

cayman06, Those are exactly the same rates my dealer gave me. He also told me that Chase will do better. i will find out how much better tomorrow. Russ

What do those numbers mean? After 36 months the buyout is 55% of purchase price? How many miles are included? Santa Fe, I would think that living where you do you'll need lots of miles. I want touse a ton of miles, so I think leasing is out for me.

Ya, my dealer in Miami also told me the same thing. However, for a tiptronic (I havea bad knee) and 15.000 miles the residual is only 50%. That is ridiculously low, I think. Does anyone recommend any other financing options?

Run your numbers here to get a handle on lease versus purchase costs. http://www.edmunds.com/new/2006/porsche/caymans/100634486/calculator.html?tid=edmunds.n.calculator.calculator.tab.3.Porsche *

Chris, The 55% is the residual amount. So if you have a 70K car, they are saying that the car will be worth $38,500 at the end of your 3 year lease. So you then will be financing $31,500 with a money factor of .00350 which equals approx. 8.75%, which stinks. Russ

Russ, As we said before 15% per year depreciation at best.

MPollard, Thanks! That's the best lease vs. buy calculator I've seen so far.

Frankly, the residuals and the money factors are both pretty brutal. P cars normally hold their values pretty well but Porsche must not think it needs to 'put money in the trunk' to move these things.

I just hope it doesn't mean they are worried about the car holding value and are hedging their bets????

I think it is too early to try and second guess their motives. I really don't think they know where to place the residual, however I would love to know where it is on a 2006 Boxster S? I should have asked my dealer I will tomorrow. I want to know what the money factor and the residual % is for the Boxster. Russ

Good point Russ

In the UK, the Boxster and the 911 have both been notorious when it comes to depreciation. I remember reading on several occasions that the Boxster is the slowest depreciating car - not sure if that is for a roadster/sports car or cars in general - and is followed closely by the 911. The What Car UK website has a depreciation index showing on a graph how the car depreciates over 3yrs/36k.

When I turned in my 99 Boxster lease in 03 the car was worth 10-12K below the residual. It was good for my monthy payments butbad for Porsche. They aren't going to make those kinds of mistakes again. The depreciation for Porsche is now no better than many other cars. Used Boxster prices are not encouraging and that market has beenpretty slow as well. The 996is about the same, anddespite what 997 owners want to believe, in time the 997 will be no better thanthe rest. The lease marketis a two edge sword, because it allows companies to move alot of cars that they might not be able to sell outright, but it can leave a glut of relatively new used cars at the end of the lease period. Not trying to start an argument but if you want to go into Porsche ownership with your financial eyes open don't expect retained value significantly better than average.

Dave, You make a good point, perhaps Porsche is now making sure the car will be worth more than the residual at the end of the lease. Monday I will find out what Chase is offering as far as money factor and residual. Russ

Russ, for what I was looking at 36 month lease, 15,000 miles for the Boxster S it was 52% vs 50% residualfor the Cayman. The Cayman was the lowest. Still can't figure out why. The 911 was 56%.

mmarantz, Thanks! Originally my dealer thought the cayman would be at 60% on a 36 month lease. I have no idea why that changed. Russ

I think we should always remember the dealer wants to make money (obviously) and so is going to quote a residual rate that will render a fat profit on resale. They want to peg a low dealer cost figure rather than an actual resale figure and the difference is $5,000 to $10K even. I have sold my last two 911's on my own and got at least $3000 more than any dealer would offer. But because of that I am much more careful about some color/option combinations, as I know how sparse, cheap, and picky buyers can be.

K-Man Sculpture, I did the same thing with my BMW, residual at the end of my 5 year was 22K and I sold the car myslef for 30K. Russ Edited by - RussK on 01/05/2006 08:42:01 AM

Nice move RussK, so you did a lease, but then sold it yourself?

Umm...I'm confused...how are you getting retained value figures of about 50-60%? I checked Autocar magazine today, and it says a Boxter S will hold 70% of its value, along with the Cayman. The 911 was a bit under that. What Car gives these values: Year 0 - £43,930 Year 1 - £37,749 Year 2 - £34,001 Year 3 - £30,601 Year 4 - £27,548 So after three years, the car's value is 70% even by whatcar calculations. For the Boxster S, the retained value as a percentage, is the same again. For 911s, it works out to about 66%

K-Man Sclpture, It was a lease and I only had 9500 miles on it so I was not about to give it back to the dealer. I thought I was going to keep that car forever, and then along came a Cayman! Russ

I think one factor is the 'local' factor, too. Out here, every Tom, **** and Harry young Silicon Valley engineer and programmer leased Boxsters and 911s like crazy during the boom, and now the place is swimming in late model Boxster and 911 lease returns, which drives the resale prices down, which inturn makes people more apt to just turn their leased cars in, which means more cars flooding the market. I did a 4year/10k miles per year lease on my turbo in 2002, the cap cost was about $125k and the residual is about $72k. If my cyphering is correct, that's about 57%. I have the car for sale for about $79k, but will probably end up in the $75-77K range if I do sell it, because between craig's list and the newspapers and the dealers, there's a lot of them around for sale. brad

Here are the numbers from Braman in West Palm. 36 month lease with 15,000 miles results in 50% residual, 12,000 miles gives you 52% residual. Here is the kicker, they quoted money factor at .00355!!! Braman is brutal on customers. They have a lot of seasonal Palm Beach people that have gazillions of dollars and generally pay cash at sticker or lease without working out deals. When I balked at the money factor, she called back and said 'oh Huntington money factor is .0028'. Then I asked if the residuals were the same and she said, after clearing her throat '46.5% for 36 months'. Porsche financing rates are 6.9%. Maybe Woodhouse could weigh in here and clear this up for us. I know the dealer has to make a profit, we all need to make a little money, but the dealer is already making 12K on the sale of the car the first time. Now you know why the dealer will push you to lease the car. The dealer wants you to put as little down as possible (My dealer suggested $3,000) because they are financing more money at 8.52%. It makes sense if you are going to lease to write a check for the entire lease amount and not finance anything. Lets see, I am getting 5-6% return on my money on a good day so I can save 3-4% by paying the entire amount up front. Clearly buying at 6.9% is better than leasing. What do you guys think of my idea of just paying the full amount up front? It is either that or buy. By the way, my car will arrive at the dealer on Monday, but I am not going to WPB until January 19th.

Being a business owner, you can write off the entire amount of the lease that is used for work purposes. When you BUY a car you can only depreciate the car up to $16,000 total over the life of the buy. If you are a business owner, you would need to factor in the fact that of the write offs vs. only depreciation. All upkeep, etc.. is also dedcutible. When you buy the car, the interest is also deductible, but all in all, it is a pretty difficult mathematical formula. Buy, you pay taxes up frront. Lease, you spread them. Buy, you can sell whenever, the residual will probably be higher on the buy. However, when you buy the write-offs could be a lot less. Lots to think about.