Unless you’ve been living under a rock at Changi Beach, you would know that buying a car in Singapore doesn’t come cheap.
Indeed, we’ve shed light on why owning a car in Singapore can cost a fortune in this informative video. Even though public transport can inconvenient with the occasional MRT breakdowns and waiting for buses, it’s still a far more affordable choice for many Singaporeans.
But what if you desperately need a car for family requirements?
What was once a luxury or a distant dream is now becoming more commonplace thanks to the emergence of long-term car leasing in Singapore.
The Shift Towards Car Leasing in Singapore
Not so long ago, renting a car in Singapore was mostly a short-term affair. Car leasing was a pricy service aimed at companies needing vehicles for their executives.
However, as the private-hire industry has grown, long-term car leasing has become more accessible and affordable.
Car rental companies, keen to seize the opportunity, started offering long-term rentals paid weekly with low deposits to attract private-hire drivers.
The Changing Landscape of Renting a Car vs Buying a Car
A significant shift occurred in the industry on 1 July 2018 when the private-hire licensing framework was introduced, requiring drivers to obtain a vocational license.
The new rules led to a drastic reduction in the number of private-hire drivers, which resulted in a surplus of rental cars.
Concurrently, prices for car rentals started to drop.
In previous years, it was common to pay a two-month deposit, but this gradually decreased to as low as $200 in some cases, making the prospect of renting a car vs buying a car more attractive.
Assessing the Pros and Cons of Renting a Car in Singapore
One of the main benefits of renting is that you don’t have to worry about insurance or maintenance costs. The car rental company usually covers these, saving you a significant amount of money every month. In addition, renting provides flexibility. You’re not tied to a long-term commitment and can adjust your arrangement according to your needs and financial circumstances.
However, car leasing in Singapore has its drawbacks as well. One obvious downside is that you end up paying more overall than if you owned the car.
Also, you may encounter high “excess” charges in the event of an accident, with some rental companies charging a large sum of money.
Considering the Pros and Cons of Buying a Car in Singapore
Buying a car in Singapore can be cheaper in the long run, especially if you choose a second-hand car with low depreciation.
In terms of insurance, the excess is usually lower when you own the car, which could save you money in case of an accident.
However, car ownership comes with a substantial initial down-payment. Furthermore, the value of the car decreases as soon as you start driving it.
Also, if you’re unfortunate enough to end up with a problematic car, you’ll have to shoulder all the repair costs.
In conclusion, when considering renting vs buying a car in Singapore, weigh the pros and cons of each option carefully. And whether you’re leasing or buying, remember to do your due diligence to avoid any unpleasant surprises.
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