Speaking to my dealer Land Rover are seeing falls in value on the older Sports (but not the 3.0 TDV6's), disco's (3&4) and freelanders. Apparently the FFRR & 3.0 Sport are holding strong mainly due to lack of supply on the second hand market.

I am looking at a 2008 Vogue SE which is on the forecourt at £44K - the GFV after 3 years and a predicted 24K miles is an upsetting £13,811

Don't know if I can bring myself to sink so much into that kind of money pit or if it is better to persevere with my old Sport (nothing has gone wrong with it for at least 2 months - a personal record for the time I have owned it)

Hi Simon,
That ties in with what I was quoted as a future value and heaven knows what it could end up at in 3 years if fuel increases at the same rate.Bear in mind I do 20K+ miles per annum ,they were asking me to take a risk on mine being worth at least £10k,the last time I did that on a MY2000 MB E320 AV it was worth half that so I had to pay a £10K balloon and sell it at half that to get shut and even then the only people who would offer me a part ex where MB against another E Class which I hated.
On your example COA is about £30K over 3 years which is roughly what mine will cost me on CH so about the same. MY2011 HSE Santorini/Ivory/Piano Black/Privacy Glass/TV .Sadly gone.
Audi A5 Sportback Black Edition 3.0 tdi quattro S Line

Thanks Chris and Simon form your advice. I am going to go down the cash route for sure, but now taking a puntnof future values of RRS's is the harder part. New model in 2013/14....do model prices really drop sharply when a new one comes out?

two thoughts from me

1. what price flexibility? with a cash purchase (when I say cash I mean cash - not borrowed cash) then I can sell the motor basically immediately and take that cash out. The cost/penalty of doing so "quickly" is much less than ending a finance deal early

2. residuals. One post said "if it's worth <£21k after 3" - my 3.5 year old (admittedly TDV8 not TDV6) is worth ~£30k from ~£58k new and recently has been going up in value. I have often thought the maths doesn't quite add up - okay you can't factor for economic/wider trends.. but again if bought for cash you can exit (one assumes) ahead of the real storm? For example the oft-quoted LR 60/40 deal - well if my motor has lost 60% after 2 years.....

3. (!!) the commission that dealers earn from this also points to the economics of car finance. We are talking thousands as opposed to hundreds - that just strikes me as a little dis-proportionate as far as 'value for money' is concerned

Nick,
That's easy just ask LR for a deal with a 3 year GFV and that will give you a good indication what it will actually be.
I did get a quote from somebody with a GFV I'll try and dig it out for you and see what it was. MY2011 HSE Santorini/Ivory/Piano Black/Privacy Glass/TV .Sadly gone.
Audi A5 Sportback Black Edition 3.0 tdi quattro S Line

NickM wrote:

....do model prices really drop sharply when a new one comes out?

RRSBoy
"3. (!!) the commission that dealers earn from this also points to the economics of car finance. We are talking thousands as opposed to hundreds - that just strikes me as a little dis-proportionate as far as 'value for money' is concerned"

A mate of mine used to sell motorbikes and gave me a tip years ago but not sure if it is till valid in law today.
He said negotiate the best deal you can based on finance they will often give you a discount off the price of the car but then claw it back from legging you up on the finance APR and getting commission on that,formally accept the deal BUT during the cooling off period change your mind and decide to pay cash at the agreed purchase price. MY2011 HSE Santorini/Ivory/Piano Black/Privacy Glass/TV .Sadly gone.
Audi A5 Sportback Black Edition 3.0 tdi quattro S Line

Reading this with interest Just to keep the thread on track, if someone is buying NEW and taking any of the special finance rates (low rate PCP or APP) then the dealer will recieve a 'Doc Fee' which would average £200 on a RRS. If dealers are steering you towards anything that is not 'campaign' finance then yes they will earn more, but in reality it will be (on average) significantly below £1000 per finance case.

GMFV's are the incentive to use funding as opposed to workable cash, however the GMFV needs to be generous enough for it to act as a residule value insurance policy. Regardless of the finance plan, the rate, or term, the most important thing is the interest charged over the term and if the cash could earn/save you more over the same period. An example is £50k financed leaves £50k savings to reduce a mortgage term, and would that saving represent more than the interest charged?

Interestingly we did have someone ask 'Whats the catch' when we mentioned the 0% APR APP deal that is running on 5.0 SC currently!

James

So are you saying James if it was your money you would.........

The financial side is one side of the issue, the other is what car!!

I miss the RRS so very much and so does the missus!!

RRS still looking as being the favourite......James I nearly came in on Sunday, but willngive it def thoughtnthis weekend and make up my mind....

NickM wrote:

So are you saying James if it was your money you would.........

To be fair, Mrs T changes her car every 2-3 years, usually for a premium brand. We always fund via a PCP, put as little cash down as a deposit as possible and obtain the highest GMFV at the lowest rate possible.

This means that at the end of the term, any equity forms the deposit for the next one, usually requiring just a 'holding deposit' to order the vehicle. We try to go for vehicles with good residule values and are careful regarding specification and colour/combo's to maximise the possible equity.

The above results in her always driving an 'in warranty' vehicle with roadside cover etc etc which is important as we live in a fairly remote area, and we know how much a month this 'transport cost' will be for a fixed period of time. We also know that should residules dive then the worst that can happen is we will not have equity (but remember that we put very little in anyway so not a major issue).

My thinking is.... how cheap can I get the payments with as little as possible in. The recipe for this is to buy a car which is in demand, order a sensible spec, take advantage of luring special finance rates. This should result in a minimal monthly outlay and keep your cash in the bank (or im my case the pockets of builders ). Then if residules are not quite as good as expected then give it back!

James

James,
I concur 100% with your thinking
I think most people worry too much about the equity in their car rather than cost of ownership. MY2011 HSE Santorini/Ivory/Piano Black/Privacy Glass/TV .Sadly gone.
Audi A5 Sportback Black Edition 3.0 tdi quattro S Line

How about a 2-3 year old RS6 avant. Prices have been coming down from the list price of £75k to around £45k to £55 for a 2-3 year old, low milage and high spec car. And if you can wait a few more months they will be even cheaper, £5k or more.

Before come over to LR last month i ran two audis, RS4 and S4. Great Cars if not a bit exensive for the RS4 to maintain, £2500 for the front brakes to be replaced. Apart from that never put a foot wrong. Just the dealers are up their own ass. RRS TDV8, 22 rims, Privacy Glass, Premuim ICE plus Leather, Sun Roof, Stornoway Grey.

Audi RS4 Avant gone but not forgotten
Audi S4 Avant gone for good, thank god.

ChrisP wrote:

James,
I concur 100% with your thinking
I think most people worry too much about the equity in their car rather than cost of ownership.

ChrisP A friend of mine who lives in the states keeps telling me that over there everybody effectively leases / rents their cars, he states that he would never consider buying and cannot understand our philosophy of buying, not sure if it is the norm or just his opinion. He does live on the west coast and enjoys a herbal cigarette whilst waiting for "surf Up"

My friends and colleagues in the USA all lease their cars. There is a cultural thing here but it really stems from the idea of why would you aspire to own something that will eventually be worthless? As long as the rental is low they are happy.

simon123 makes what at first glance is a valid point

however.. if i buy for cash and 3 years later it is worth £20k less, it has cost me £20k (ignoring opportunity cost and effects of inflation)

if i rent for 3 years and those payments add up to £24k, then what is the benefit exactly?