A fixed horizon changes the question
Most advice about leasing against buying assumes you will stay put. A temporary posting removes that assumption. You know roughly when you will leave, you may not be able to take the car with you, and you will be selling or returning it under time pressure in a market you do not know well. That reshapes the comparison, because the exit is no longer a distant abstraction. It is a dated event with a cost.
The correct method is horizon matching, which means we compare the two options over exactly the number of months you expect to be there, counting every payment in and out, including the exit.
The two formulas
Cost of buying over horizon H = purchase price plus acquisition costs, minus net resale proceeds, plus running costs you bear, plus the cost of the capital tied up.
Cost of leasing over horizon H = initial payment, plus monthly payments across H months, plus excess distance charges, plus end of contract damage and reconditioning charges, plus any running costs the contract does not include.
The two are only comparable if you treat running costs consistently. Many lease contracts bundle maintenance, road tax and sometimes insurance. If yours does, you must add the same items to the buying side or the comparison is meaningless.
A hypothetical worked example
All numbers are invented for illustration. They correspond to no real market or contract. Assume a 24 month posting and 15,000 kilometres a year.
Buying. Suppose the car costs 22,000 including taxes, and registration and transfer costs are 700, so 22,700 out. Suppose after 24 months it sells for 68 percent of 22,000, that is 14,960, and suppose selling costs, being advertising, a roadworthiness certificate and transfer paperwork, come to 400, so net proceeds are 14,560. The capital loss is 22,700 minus 14,560, which is 8,140. Suppose maintenance, road tax and inspection over the two years total 1,200. Suppose the capital tied up could otherwise have earned 3 percent a year, so approximately 22,700 multiplied by 0.03 multiplied by 2, that is 1,362, treated as a simple approximation. Total cost is 8,140 plus 1,200 plus 1,362, which is 10,702, or 446 a month.
Leasing. Suppose the initial payment is 2,000 and the monthly payment is 320, so 24 months at 320 is 7,680, giving 9,680. Suppose maintenance and road tax are included. Suppose you exceed the contract distance by 4,000 kilometres, charged at 0.08 each, that is 320. Suppose return condition charges are 250. Total is 9,680 plus 320 plus 250, which is 10,250, or 427 a month.
| Line | Buying (illustrative) | Leasing (illustrative) |
|---|---|---|
| Cash out at start | 22,700 | 2,000 |
| Payments over 24 months | 1,200 running costs | 7,680 |
| Exit charges | 400 selling costs | 570 excess distance and condition |
| Cash back at exit | 14,960 resale | 0 |
| Cost of capital tied up | 1,362 | 0 |
| Total over 24 months | 10,702 | 10,250 |
| Per month | 446 | 427 |
The answer is inside the error bars
The difference is 452 across two years, under 5 percent. That is smaller than the uncertainty in the resale assumption, which is the point. Rerun the buying case with 62 percent retention instead of 68 percent. Resale becomes 13,640, net proceeds 13,240, capital loss 9,460, and the total 9,460 plus 1,200 plus 1,362, which is 12,022, or 501 a month. A six point move in a number you cannot control swings the comparison by more than the comparison itself.
This is the practical conclusion. Over a short horizon, buying is a bet on resale value and leasing is a purchase of certainty about it. The lease company has priced the residual risk and taken it. You are paying for that transfer, and whether the price is fair depends on whether their residual assumption is more or less optimistic than reality.
Factors specific to being temporary
| Consideration | Buying | Leasing |
|---|---|---|
| Eligibility | Usually needs local registration and an address, sometimes local residency | Often needs residency, a local bank account and a credit check you may fail as a newcomer |
| Contract length flexibility | Sell whenever you like, at whatever the market gives | Fixed term. Early termination charges can be severe |
| If the posting is extended | Simply keep the car | Extension may be possible, often at a renegotiated rate |
| If the posting is cut short | Forced sale, likely below market | Early termination penalty, sometimes most of the remaining payments |
| Taking the vehicle when you leave | Possible, subject to export and import rules | Normally prohibited without written consent |
| Cross border driving | Check insurance territorial limits | Contracts often restrict which countries you may enter |
| Cash requirement | Large amount tied up from day one | Small deposit, preserves liquidity during relocation |
| Condition risk at exit | Damage reduces resale price | Damage assessed against a written fair wear standard |
Other options worth pricing
- Short term subscription. Higher monthly cost, but usually cancellable monthly and inclusive of insurance and maintenance. Often the cheapest total for stays under a year and for uncertain end dates.
- Buy back arrangements. Some sellers offer a contracted repurchase at a fixed price and date, which converts the residual risk into a known number.
- Employer provided vehicle. Frequently the cheapest option in cash terms, though it may create a taxable benefit that must be counted.
- No car at all. In dense cities, the honest comparison includes rentals, car sharing and public transport for the same period.
What to check before signing
On a lease, read the early termination clause, the excess distance rate, the fair wear and tear standard, the territorial restrictions and what happens if your residence permit ends. On a purchase, verify that you can legally register a vehicle at your residence status, get an insurance quote before committing, and research resale liquidity for that model in that market, since a car that is easy to buy is not always easy to sell.
Leasing law, consumer protections, credit requirements and residency rules differ considerably between countries, and tax treatment of leases can differ again. We would have any contract reviewed by a qualified local professional before signing, and treat this article as general information rather than personalised financial or tax advice.
How to Use This Guide
Every worked example on this page is illustrative. The figures are chosen to show how the calculation behaves, not to report current market rates. Costs, tax rules and eligibility criteria differ by country and change over time, so take the method from this page and put your own current figures into it. Browse the rest of our guides, or see how we source and check our comparison figures on the about page.
Information only. This article explains how costs and rules are structured. It is not financial, tax, legal or immigration advice, and it is not a recommendation to buy any property, vehicle or investment. Confirm anything that affects a decision with the relevant local authority or a qualified professional before you act on it.
Last updated: August 14, 2026