In BC, what should I know about leasing vs financing for car loans?

In British Columbia, the choice between leasing and financing a car loan carries distinct financial implications and lifestyle considerations. Leasing typically offers lower monthly payments and often requires less upfront capital, allowing you to drive a newer vehicle more frequently, usually under manufacturer warranty for most of the term. However, you don't build equity, face mileage restrictions, and may incur wear-and-tear charges at the end of the lease. For 2025, market conditions with potentially higher interest rates could still make leasing attractive for those prioritizing lower monthly outflows, though residual values and lease factors are dynamic.

Financing, conversely, means you own the vehicle outright, building equity over time with no mileage limits or end-of-lease fees. While monthly payments are generally higher and you're responsible for all maintenance post-warranty, you gain full control and the asset is yours to sell or trade whenever you choose. In BC, Provincial Sales Tax (PST) is applied differently: on each lease payment versus the full purchase price upfront for financing, which can impact cash flow. Understanding your driving habits, budget, and long-term ownership goals is crucial to determine which option best aligns with your personal financial strategy in the current Canadian auto market.