According to Edmunds.com, more millennials lease vehicles like Jaguars, Cadillacs, and Dodges.
Just because many millennials live on tight budgets doesn’t mean they don’t have nice cars.
But rather than buy new vehicles, they are leasing bigger, more luxurious cars and trucks than they otherwise could afford.
Almost 30% of millennials’ new vehicle purchases in 2015 have been done through a lease, according to a new study from the car-buying website Edmunds. This is higher than the overall percentage of leased vehicles across all ages, which was just under 27% during the same time period.
During the past five years, the number of millennials who lease vehicles has increased by 46%, while the overall number of leasers has increased by 41%.
Data from Edmunds’ millennial survey showed that 57% of people said they would not put more than a $2,999 down payment on a vehicle. Nearly 55% if respondents said that they would pay more than $299 a month on a car payment.
Using those figures, car shoppers who need financing typically have to find cars that cost less than $20,000.
However, people who choose leasing over buying can use the same down payment and monthly cost to get a car that costs as much as $35,000.
Most millennials understand and accept that they’re on a tight budget but that doesn’t mean that they are limited to the most basic vehicles, said Jessica Caldwell, director of industry analysis for Edmunds.com. If they see an opportunity to get into a nicer car while staying within their budget, they’ll take it.
Millennials often prefer to lease bigger, more high-end, tech-savvy brands compared with vehicle-buyers across all age groups.
The study showed that millennials who get certain vehicles are more likely to lease it than other age groups.
For example, millennials were 30% more likely to lease a Dodge Ram than other age groups. The same principal applied to certain brands, with millennials being 26% more likely to lease a GMC vehicle and just under 24% more likely to lease a Lexus.
The other brand that Millennials lease more than anyone else are Jaguar, Cadillac, Buick, Subaru, Scion, Mini and Acura.
The rate that millennials lease vehicles is larger than that of the overall population in every one of Edmunds’ 24 vehicle segments except for compact cars.
An estimated 25% of all new compact cars registered by millennials this year were leased, compared with 26% of new compact cars registered by the general population.
Overall, the findings suggest that millennials are more willing than older adults to sacrifice the long-term financial benefits of car ownership in order to get into a new vehicle with the newest technology every two to three years, much like they do with their cell phone.
