The base rate of interest recently increased to 3%, meaning inexpensive finance rates aren’t likely to linger much longer.
How will this influence the price of cars?
We’ve taken a more holistic view by looking at the macroeconomic environment as a whole. Although rates have gone up, asset values are decreasing. In other words, assets (cars) aren’t costing as much as they used to, which has the potential to be incredibly favourable.
Here's an example:
We’ve broken down the figures for the fantastic Porsche 911 (992) Turbo S.
These two cars are ‘equivalent assets’; same age, same mileage. One was being sold in August and one in November of this year. If you financed this car through the bespoke package below, your net position would have improved by around £7,645.04, based on the same purchase in August.
Despite the increased cost of funds, interest charges are being negated by the cost saving of the asset over the three month period. Affordability has been maximised by reduced monthly payments, which will in turn have a positive effect on cash flow requirements.
In total, the amount payable has reduced from £237,159.28 in August to £224,804.32 in November, meaning you could have saved £12,354.96.
Asset Value is decreasing faster than Asset Cost, a differentiation that you could certainly benefit from.
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