Purchase vs Leasing

5 min read
It’s not a widely accepted idea among locals — who are still beholden to the prestige of ownership — but leasing a car has many advantages beyond those enjoyed by car owners.

Singapore has an admirable public transport network, which includes the MRT system, buses, taxis, and ride-hailing services.

If all these transport modes get us to work and play efficiently, why is owning a car still so desirable? Maybe it’s the convenience; after all, having a car on hand makes it so much easier to bring the family out on weekend outings, or even a trip up north to Malaysia over the school holidays. And nothing beats having your own car in an emergency.

However, cars in Singapore are really expensive. The monetary outlay for one is huge, and we are tied down to a long repayment term of a few years. However, if you still wish for your own set of wheels, but don’t want to be obliged to place a five-figure down payment, leasing may be the way to go.

Common among expats

Leasing a car may not be a top-of-mind idea, but it’s common among the expatriate community. As expats are here on a temporary basis, buying a car does not make economic sense. Leasing gives them the convenience of a car without the headache of buying one. You don’t own the car, but you do really have a car to call your own!

While many Singaporeans still seek the prestige of owning a car, more and more are viewing vehicle ownership as something purely practical. Leasing is like renting: you get your very own set of wheels for a period of time, paying a monthly rent for that convenience. When you buy a car, you need to fork out a huge amount for the upfront cost, which includes the down payment, road tax, and insurance fees. Then there is the financial commitment for the long haul while the car is depreciating at the same time. Over the years, your monthly payments are going towards something that is slowly but surely losing its value.

When you buy a car, you may need to wait up to a few months for delivery, depending on availability. With leasing, you select from the company’s fleet of cars and get your keys almost immediately. The bonus is that some of these leasing companies boast the newest models — imagine changing to the latest hot rod every few years without the huge initial monetary outlay each time. Of course, if you are ultra-picky and must have a particular make and model, you will likely need to bear with some lead time before getting to drive it.

And if you feel you cannot afford the lease after it expires, you have the option to stop the lease until you can afford to renew, or go for a less expensive model. Some companies let you transfer your existing deposit to the new car so it’s easier if you decide to upgrade or downgrade the car model.

Do note, though, that new and flashy models may not necessarily be more affordable via leasing as opposed to purchase. Most companies have a list of recommended cars that they could sell. It is advisable that you exercise due diligence.

Perks by leasing companies

Of course, as it is not your own car, you don’t have the liberty to customise the wheels, or get it spray-painted to match your favourite colour. But these are indulgences that are unlikely to be on everyone’s priority list. The idea of not worrying about road tax, insurance premiums and servicing costs makes leasing an attractive financial alternative to purchasing.

Some leasing companies even provide extras, such as vehicle delivery and collection (usually during normal business hours) and unlimited mileage. Most will also take care of vehicle inspections, servicing, and replacement of parts due to wear and tear.

For example, Avis Lease has an all-in-one yearly car solution that takes care of insurance, taxes, servicing, delivery, and breakdown assistance. Hertz Long Term Lease offers comprehensive insurance, road tax, servicing, 24-hour breakdown assistance, unlimited mileage and replacement vehicles. They are also currently running a BMW promotion for as low as $2,288 monthly. (Hint: Read to bottom of article for more promotion details)

Who should consider leasing

Leasing is ideal for those who need to use a car but want to avoid the hefty cash downpayment required to buy one. These could be:

  • part-time salespeople doing occasional sales calls
  • expatriates posted to Singapore for a two- or three-year term
  • senior citizens who don’t wish to drive beyond the next two to three years
  • car enthusiasts who want to be seen driving the latest models every few years

Leasing terms usually last between one and three years; the longer the term, the cheaper the rate. As a rough guide, for a brand-new Toyota Altis, the rates range from $1,540–$1,820 per month. If you are looking for a SUV-type vehicle, a brand-new Mitsubishi Outlander will set you back about $2,400 per month. Looking at a luxury compact model? Then you need to pay around $2,800 for a 2015–2017 Mercedes CLA. The leasing rates usually include all taxes and insurance, as well as a courtesy car in the event of any scheduled maintenance.

With so much freedom and flexibility, leasing a car — rather than buying one — may be an idea worth looking into.


Looking for a more flexible term? Try Avis Flex, a monthly car rental. Email reservations@avis.com.sg with AWD: S733100 to enjoy 25% off for bookings and pickups by 31 Dec 2019.

Terms and conditions:
– Valid for bookings and pickups by 31 December 2019.
– Not available for bookings in 2020.
– Minimum 28 days and above.
– Driver requirements: 23–69 years old, at least 1 year’s driving experience (no P-Plate), valid credit card.

For long term leasing alternatives, email sales@avis.com.sg.


Experience sheer driving pleasure. Lease a BMW with Hertz from just $2,288 per month. To find out more, call Hertz at 6447 3388 or email lease.hertz@simedarby.com.sg. Promotion is valid till 31 Dec 2019.

Terms and conditions apply.