For real estate agents, who spend a lot of time driving and in their cars for business purposes, the decision about whether to buy or lease a vehicle is more complicated than for the average consumer. Here are a few of the major factors you’ll need to consider:
Why leasing might be more attractive for a real estate agent than other consumers is the tax treatment of the car if you’re using it primarily for business. How favorable that tax treatment is for you depends on how much of its use is for business, how expensive the car is, and how you choose to deduct the expenses. Owning a car comes with different tax benefits for a sole proprietor, such as depreciation, which you can’t claim on a leased vehicle. Consider consulting a tax expert to help you figure out the details for your specific situation.
Leasing a new car lets you enjoy the latest features and comforts with a lower monthly payment than you’d have while financing the same vehicle—a plus if you want something nicer for transporting clients but don’t want to make the hefty downpayment for a luxury car. Included maintenance and warranty coverage also can be a selling point if you don’t want to worry about unexpected repair expenses or upkeep. But you will still need to keep a leased car in whatever condition is acceptable under the agreement to not be hit with penalties when you return it.
How many miles do you typically drive per year? There’s no limit to the miles you can put on a purchased car, but how many miles you can put on a leased car without penalty depends on the agreement and whether or not you purchased extra miles upfront. The per mile penalties for going over the allowed mileage can often be steep. If you work a market where listings are often far apart and your mileage will be high as a result, leasing may be more expensive for you.