A car leasing web site owner predicts a big rise in car lease deals in coming years for the UK market. Car leasing involves paying a hire fee to the company that retains ownership of the car and to whom it is returned at the end of the hire period.

Car leasing is also known as contract hire and comes in various styles: Personal Contract Purchase, Personal Contract Hire, Business Contract Hire, Hire Purchase, Lease Purchase, Finance Lease, etc. Lease agreements can include a maintenance contract such that all servicing and repairs are the responsibility of the contract hire company.

One of the reasons for the predicted boom in car leasing is that car prices are ever-rising and depreciation is now a significant factor. A conventional hire purchase deal sees you pay off the cost of the car, plus finance interest prices only to be left with a car that has depreciated substantially in price at the end of the finance term. You could lose twice - interest rates plus depreciation values. A car lease deal sees the lease company as taking the shortfall in the car's value, plus you don't have to spend a big sum to acquire the car.

Only about 1 per cent of UK car purchases involve a lease deal at the moment. Contrast this with the USA where the rate is around 25%.

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