Singapore Car Lease vs Buy Calculator
Compare the total cost of leasing versus financing a car over the lease term — lease payments + fees against the net cost of buying after you sell and recover its value. Free.
Car Lease vs Buy Calculator
Leasing has lower monthly payments but you own nothing at the end; buying costs more per month but leaves you with a car worth selling. This compares the true cost of both over the lease term — counting the equity you'd hold if you financed and sold at the end.
In Singapore the COE is a large, separately-bid component of what a car costs, and it is the part that expires rather than depreciating — which is why lease-versus-buy behaves differently here than in markets where the whole vehicle holds resale value. Premiums are the closing bids of the most recent exercise, as published by the Land Transport Authority.
Contains information from COE Bidding Results / Prices (Land Transport Authority) accessed on from data.gov.sg which is made available under the terms of the Singapore Open Data Licence version 1.0.
How to Use the Lease vs Buy Calculator
Enter the lease quote
Your down payment (drive-off amount), the monthly payment, the lease term, and any end-of-lease disposition fee. The lease total is simply everything you pay over the term, since you hand the car back at the end.
Enter the finance terms
Your down payment, the loan APR, and the loan length if you bought the same car. The tool computes your monthly payment from the price, down payment, and rate.
Estimate the resale value
The key buy-side input: what the car would be worth when the lease term ends. This is the value you recover by selling — the equity that makes buying cheaper in the long run. Use a realistic figure: the residual value written into the lease quote itself, a dealer's guaranteed future value, or used-car listings for the same model at the age yours will be when the term ends.
Read the comparison
Buy net cost subtracts the equity you'd hold (resale value minus any loan still owed) from what you paid. Lease total has no offsetting asset. The lower figure is the cheaper option over that horizon — though cash flow and how long you keep the car matter too.
Lease vs Buy — Comparing the Real Cost
Why Monthly Payment Is the Wrong Comparison
Dealerships love to compare a lease and a loan on monthly payment alone, and on that measure leasing almost always wins — you can drive a nicer car for less per month. But the monthly payment hides the whole story, because at the end of a lease you own nothing, while at the end of a loan you own an asset you can sell. A fair comparison has to count that asset. This calculator does it over the lease term: the lease side is just the sum of everything you pay (down payment, monthly payments, and any disposition fee), since the car goes back. The buy side is what you pay over the same period, minus the equity you'd hold — the car's resale value less any loan balance still outstanding. That equity is the buyer's reward for the higher payments, and it's exactly what the payment-only comparison ignores.
When you do the full math, buying is usually cheaper if you keep the car, because leasing means continuously paying for the steepest part of a car's depreciation and then walking away with nothing. A lease essentially rents the car for the years it loses value fastest, plus a built-in profit (the "money factor") for the leasing company. Buying and holding spreads the cost of that same depreciation across a longer ownership, and once the loan is paid off you drive for "free" except running costs. The decisive variable is resale value: the better a car holds its value, the more equity the buyer recovers and the more leasing costs by comparison. That's why leasing can look relatively better on fast-depreciating luxury cars and worse on value-retaining models — and why your resale estimate is the most important input here.
"A lease rents a car for the years it depreciates fastest, then hands it back. Buying pays for that same depreciation but keeps the leftover value — which is why, if you keep the car, owning usually wins on total cost."
When Leasing Still Makes Sense — and the Global View
The total-cost winner isn't the only consideration. Leasing has real advantages for some drivers: lower monthly payments free up cash flow, you always drive a newer car under warranty, you avoid the hassle of selling, and for business use the tax treatment can favour leasing. People who want a new vehicle every two or three years, who value predictable costs and no resale effort, or who can write off a business lease may rationally choose to lease even though it costs more over time. Buying suits those who keep cars for many years, drive high mileage (leases penalise mileage overages heavily), or want to build equity and eventually be payment-free. For drivers outside the US, the same comparison applies with local nuances — in the UK, personal contract purchase (PCP) and personal contract hire (PCH) deals dominate and work similarly to leasing; across Asia, including Singapore and Malaysia, high vehicle taxes, COE costs, and strong-or-weak resale markets shift the maths, so plug in your own figures. Whatever the market, compare total cost including the resale value, not just the monthly payment.
A lease rents the steepest depreciation years, with a margin on top
A fair comparison counts the equity a buyer holds, not just monthly payment.
Leasing has lower payments but you own nothing at the end.
A lease essentially rents the steepest depreciation years, plus a profit margin.
If you keep the car, buying is usually cheaper over the long run.
Resale value is the key input — better value retention favours buying.
The lease quote's own residual value is a ready-made resale estimate for the buy side.
Leases charge steep mileage overage fees — bad for high-mileage drivers.
The lease "money factor" is the built-in interest you pay the leasing company.
Leasing suits drivers who want a new car every few years with predictable costs.
UK PCP/PCH deals work much like leasing; tax rules can favour business leases.
Frequently Asked Questions
- Over the long run, buying and keeping the car is usually cheaper, because leasing means paying for a car's steepest depreciation years and then owning nothing. Leasing wins on monthly payment but not on total cost once you count the equity a buyer keeps. The decisive factor is resale value: the more a car holds its value, the more buying saves. Enter your figures above — the calculator compares lease total against net buy cost after resale.
- Because a lease only charges you for the car's depreciation during the lease term plus a finance charge — not for the whole vehicle. A loan payment covers the entire price (minus your down payment) plus interest, so you're paying down the full value. That's why leases feel cheaper monthly: you're financing a slice of the car, not all of it. But you give the car back at the end, while the buyer keeps an asset worth selling.
- It's what buying actually costs you over the lease term after accounting for the car's leftover value. The tool takes everything you'd pay if you financed (down payment plus monthly payments over the term), adds any loan balance still owed at the end, then subtracts the car's estimated resale value — because that resale (minus the remaining loan) is equity you can recover by selling. The result is the true net outlay, which is the right number to compare against the lease total.
- Because the resale value is the buyer's payoff — the equity that offsets the higher payments. A car that holds its value well leaves the buyer with a large asset, making buying clearly cheaper. A fast-depreciating car leaves less equity, narrowing or even reversing the advantage. Since resale is an estimate, try a conservative and an optimistic figure to see how sensitive the comparison is. It's the single most important and most uncertain input in the lease-versus-buy decision.
- Leasing can be the better choice if you want a new car every two or three years, value lower monthly payments and predictable costs, dislike the hassle of selling, drive modest annual mileage, or can deduct a lease as a business expense. It's also appealing for fast-depreciating vehicles, where you offload the worst of the value loss. The trade-off is paying more over time and never building equity — a perpetual payment. It's a lifestyle and cash-flow choice as much as a cost one.
- Watch for mileage limits (per-mile or per-kilometre overage charges add up fast if you drive a lot), "excess wear and tear" charges at turn-in, a disposition fee to return the car, an acquisition fee at the start, and gap insurance requirements. Ending a lease early is expensive. The advertised monthly payment also often assumes a large down payment ("drive-off"), which this calculator includes in the lease total. Read the lease contract carefully — the fees are where leases get more expensive than they first appear.
- Yes — dramatically in buying's favour. This tool compares over the lease term for a like-for-like view, but the longer you keep a bought car, the more buying wins, because you stop making payments once the loan is paid off and keep driving an asset you own. A leaser, by contrast, keeps making payments forever as they lease car after car. If you typically hold cars for 5–10 years, buying's long-run advantage grows well beyond what the lease-term comparison shows.
- The money factor is the lease's equivalent of an interest rate — the finance charge the leasing company builds in. To convert it to an approximate APR, multiply the money factor by 2,400 (so a money factor of 0.0025 is about 6% APR). It's often not disclosed plainly, so ask for it and compare it to loan rates. A high money factor makes a lease more expensive even if the monthly payment looks attractive, which is one reason the total-cost comparison matters.
- The framework is the same; the products and costs differ. In the UK, personal contract purchase (PCP) and personal contract hire (PCH) are the common alternatives to a loan and behave like leasing, with a balloon/optional final payment in PCP. Across Asia, including Singapore and Malaysia, high vehicle taxes, registration fees, and in Singapore the Certificate of Entitlement (COE) heavily shape both purchase cost and resale value, which changes the maths. Enter your local figures — price, payments, term, and a realistic resale value — and the comparison holds wherever you drive.
- Yes — and you should. A lease is built on the car's negotiated price (the "capitalized cost"), so haggling the price down lowers your monthly payment just as it would on a purchase. You can also ask about the money factor (the lease's interest rate) and the residual value. Beware of rolling a big down payment into a lease: if the car is totalled or stolen early, you can lose that money, which is why many advise minimal money down on a lease and relying on gap coverage. Negotiate the price first, then discuss lease terms.
Method & sources
How it computes
Compared over the lease term. Lease total = drive-off + monthly payment × months + disposition fee. Buy payment from the amortising-loan formula M = P·r ÷ (1 − (1 + r)^−n) on (price − down payment) at APR ÷ 12; net buy cost = down payment + monthly × min(lease term, loan term) + loan balance still owed at the end of the lease term − your resale estimate. Lower total wins; a gap under 1% of the price is called a wash. Currency is a label only; no exchange rate is applied.
What this tool implements
- Closed-end lease cost = all cash paid over the term (drive-off, monthly payments, disposition fee); the lessee builds no equity — the payment structure US Regulation M (12 CFR 1013) requires lessors to disclose.
- Loan payment and remaining balance use the ordinary-annuity formulas with monthly compounding at APR ÷ 12; 0% APR falls back to straight-line repayment.
- Equity at lease-end = resale value − remaining loan balance; resale value is your input, not a depreciation model.
- COE panel: Category A and B premiums are the latest closing bids from the most recent LTA bidding exercise (held twice a month) via data.gov.sg, server-cached, and are added to the price only when you click; a car takes one COE, so only one category can be added at a time.
Sources
- Consumer Financial Protection Bureau. Regulation M — Consumer Leasing, 12 CFR Part 1013 (implements the Consumer Leasing Act; covers automobile leases and the disclosure of lease payments, early-termination and purchase-option terms). https://www.consumerfinance.gov/rules-policy/regulations/1013/
- Land Transport Authority (Singapore). COE bidding results by month, bidding exercise and vehicle category — data.gov.sg dataset d_69b3380ad7e51aff3a7dcc84eba52b8a. https://data.gov.sg/datasets/d_69b3380ad7e51aff3a7dcc84eba52b8a/view
- Brealey RA, Myers SC, Allen F, Edmans A. Principles of Corporate Finance. 14th ed. New York: McGraw Hill; 2022. (annuity, loan-amortisation and outstanding-balance formulas)
What can make this go out of date
- LTA COE premiums change at every bidding exercise (twice a month); the panel shows the cached latest result with its date
- Lease fee structures and the money-factor convention are market practice, not fixed constants
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