Leasing rents the car's best years; buying pays full price but keeps the machine. The honest comparison needs a time horizon.
When a lease ends, you sign another: the down payment repeats each cycle, with payments rising a bit on each new car.
Cars lose ~15–20% in year one, then ~10–15%/yr. The car's value at your horizon comes back to you when you sell.
Leased cars stay under warranty; owned cars get older. Applied after year 4.
This lease vs. buy calculator compares the total cost of leasing against buying over a time horizon you choose. Buying pays full price but keeps the resale value; leasing only pays for the years you drive but starts a new down payment each cycle.
Leasing is modeled as a stream of payments plus a fresh down payment each time a lease cycle restarts over your horizon. Buying is the purchase price and financing cost minus the car's resale value at the end, following a depreciation curve. The longer the horizon, the more buying pulls ahead, because a bought car's cost is front-loaded while leasing keeps repeating.
Over a short horizon leasing can cost less per month, but buying and keeping the car usually wins over longer periods because you retain the resale value.
Leasing repeats its costs every few years, while a bought car's cost is front-loaded and then drops. The longer you keep a car, the more buying pulls ahead.
Yes, in the sense that you own a depreciating asset you can sell. A lease leaves you with nothing at the end of the term.
Per month and over a short horizon, often yes. But leasing never stops paying, while a bought car's cost drops once it's paid off and you keep the resale value. Over many years buying usually wins.
You return the car and have nothing to show for the payments, then typically start a new lease with another down payment. The calculator counts each of those repeated down payments.
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