Irish Calculators
Loans & mortgages

Lease or Buy a Car Cost Comparison Calculator

Compare the present cost of buying and leasing a car over the same number of months. Enter the lease quote and resale assumption yourself; neither a market valuation nor a lease offer is generated.

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%
Monthly interest is the annual nominal rate divided by 12. This is not a fee-inclusive APR.
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How the calculation works

Compare the present cost of buying a vehicle with a supplied lease quote over one horizon. Buying recognises estimated sale value and outstanding debt; leasing includes the upfront, monthly and ending charges entered.

Discount all monthly costs to today; buying deducts resale value less outstanding loan at the common horizon. Leasing includes upfront, monthly and end charges.

  1. Build purchase cash flows

    Deduct the deposit from price to calculate borrowing. Include deposit, upfront fees, repayments and running costs over the chosen horizon.

  2. Recognise ending equity

    Account for remaining loan debt when deducting resale value at the horizon. Ignoring debt when selling early would make buying look artificially cheap.

  3. Compare present costs

    Include lease upfront, monthly, running and end charges. Discount both alternatives consistently, then subtract buying cost from leasing cost.

Worked example: Cash costs over two months

Sample inputs demonstrate the method. They are not a forecast or product offer.

In the first example, buying costs €10,000 and the vehicle retains €5,000 value after two months, leaving €5,000 net cost. With no other charges or discounting, two €1,000 lease payments cost €2,000. Leasing minus buying is minus €3,000.

Purchase price including taxes
10000
Purchase deposit
2000
Annual nominal interest rate (%)
0
Remaining term (months)
2
Comparison horizon (months)
2
Estimated resale value at horizon
5000
Purchase and loan fees paid upfront
0
Monthly running cost when buying
0
Lease upfront non-refundable cost
0
Lease monthly payment including taxes
1000
Monthly running cost when leasing
0
Lease end and mileage charges
0
Effective annual discount rate
0

Expected result

Present cost of buying
€5,000.00
Present cost of leasing
€2,000.00
Leasing minus buying cost
-€3,000.00
Worked example: Remaining debt included at early horizon

Sample inputs demonstrate the method. They are not a forecast or product offer.

Purchase price including taxes
10000
Purchase deposit
2000
Annual nominal interest rate (%)
0
Remaining term (months)
4
Comparison horizon (months)
2
Estimated resale value at horizon
7000
Purchase and loan fees paid upfront
100
Monthly running cost when buying
50
Lease upfront non-refundable cost
200
Lease monthly payment including taxes
1000
Monthly running cost when leasing
0
Lease end and mileage charges
100
Effective annual discount rate
0

Expected result

Present cost of buying
€3,200.00
Present cost of leasing
€2,300.00
Loan balance at horizon
€4,000.00

Understanding your result

A negative leasing-minus-buying result means the entered lease scenario has lower present cost. It does not establish that all leases are cheaper or account for different vehicle condition and usage.

Resale and running-cost assumptions can materially change the conclusion. Test plausible alternatives before relying on a small difference between the two scenarios.

Questions you might have

Why include the remaining loan balance?

If you sell before the loan ends, the sale proceeds must first repay that debt. Omitting it understates buying costs.

Choosing the right inputs

Comparison horizon (months)
Use one comparison period for both alternatives. The purchase loan can have a different term, so remaining debt matters when the comparison ends earlier.
Estimated resale value at horizon
Supply estimated vehicle value at the comparison horizon. The tool does not obtain a market valuation or guarantee sale proceeds.
Lease end and mileage charges
Include expected end or mileage charges under the quote. Zero means no allowance was entered, not that the contract cannot impose charges.
Effective annual discount rate
Use an effective annual discount rate for cash-flow comparison. This differs from the nominal annual interest rate on purchase borrowing.

Common mistakes to avoid

  • Do not compare a short lease period with full-lifetime ownership cost without a common horizon.
  • Do not deduct full sale proceeds while forgetting debt still payable from the sale.

Assumptions to check

  • Vehicle resale and running costs are your assumptions; no market valuation or lease price is generated.

Sources and method

Read our calculation and testing approach.