Car finance: best new cars for less than £500 per month

  • Choose from sleek saloons to sporty coupes
  • High-class models can be startlingly affordable
  • We've rounded up the best lease and PCP deals

£500 is a good chunk of change to spend on a car every month. And while £500 could lease you five Fiat 500s, it's probably best spent elsewhere.

The good news is that if you like the finer things in life, this amount of money really opens a whole new world of luxury. If there's £500 burning a hole in your pocket at the start of every calendar flip, and you have a driveway with space on it, boy, do we have some good deals here for you.

Leasing deals, as well as PCP finance offers, mean that a wide range of body styles are on offer, all from premium and desirable marques including Audi, Volo, Range Rover, and even Tesla.

Best new cars for less than £500 a month 2019

LEASE: Tesla Model 3 

Best new car for less than £500 a month for: eco-bling

Tesla model 3 rear

We at Parkers like the Tesla Model 3 so much, we crowned it our Car of the Year in our annual awards ceremony.

The Model 3 picked up more category wins than any single model previously, taking home the Electric Car of the Year and Company Car of the Year gongs.

Less than £500 per month gets you a 254-mile range, access to Tesla's exclusive Superchargers, and a smug-factor few can rival.*

Leasing price: from £440 per month

*These deals are indicative examples of some packages available as of 25 February 2020 but are subject to change without prior notice. Everyone’s financial circumstances are different, and the availability of credit is subject to status. Terms, conditions and exclusions apply. Parkers cannot recommend a deal for you specifically. Bauer Consumer Media Limited is an appointed representative of ZenAuto Limited for the broking of regulated hire agreements. ZenAuto Limited is authorised and regulated by the Financial Conduct Authority. ZenAuto Limited's registered office is Number One, Great Exhibition Way, Kirkstall Forge, Leeds LS5 3BF. ZenAuto Limited's company registration number is 10967345. ZenAuto is the trading name of ZenAuto Limited. Terms, conditions and exclusions apply.


PCP: Volvo XC90

Best new car under £500 a month for: safety

Volvo XC90 review

It is big, and it is clever. The Volvo XC90 brings safety and practicality for all seven members of the family, while being a whole lot less ostentatious and showy than anything with the Range Rover badge on the boot.

A fleet of safety systems ensure that it's one of the safest cars out there, and the new mild-hybrid diesel engines make sensible options.

£499 per month will bag you a B5, which is one of these sensible mild-hybrid diesels. It has 235hp and 480Nm of torque and will complete the 0-62mph sprint in 7.6 seconds. It should do close to 37mpg too.**

Volvo XC90 B5 Momentum

  • Monthly cost: £499 (47 payments)
  • Deposit: £8,112.97 (including deposit contribution of £7,133.88)
  • Total amount payable by customer to buy car: £55,216.85
  • Cash price: £53,785
  • Mileage allowance: 10,000 miles per year
  • APR: 4.9%

Volvo XC90 PCP deal

PCP: Toyota GR Supra

Best new car under £500 a month for: muscle car looks

2019 Toyota GR Supra

If you're looking for a great GT car that's filled with heritage, and attitude, the GR Supra is easy to recommend.

Toyota set out from the get go to make it an enjoyable yet every day kind of sports car. By and large it has succeeded. And while the Alpine A110 and Porsche Cayman are both brilliant too, there's no denying that the Supra is just that much better to deal with day to day.

A 3.9% APR is sensible for this kind of car, and it's backed by Toyota's five-year warranty too.

Toyota GR Supra PCP deal

  • Monthly cost: £494.59 (42 payments)
  • Deposit: £10,825
  • Total amount payable by customer to buy car: £59,475.69
  • Cash price: £54,620
  • Mileage allowance: 8,000 miles per year
  • APR: 3.9%

PCP: Audi S6 Avant

Best new car under £500 a month for: posh badge and powerful engine

Audi A6 Avant

Recent trends have seen manufacturers filling smaller and smaller niches. Audi's no stranger to this (Q8, anyone?) but the A6 is a traditional, big and practical estate.

The 565-litre boot is large (but smaller than some rivals), but at least the passenger space is very impressive front and rear. And the S6 comes with a 3.0-litre diesel sporting 350hp, that's capable of hurling this family lugger from 0-62mph in 5 seconds.

A £4,000 discount up front (in the form of a deposit contribution) is pretty hefty and brings this £63,000 car down to £519 per month. Yes, it is slightly above £500, but we thought that this deal was worth it.**

Audi S6 Avant

  • Monthly cost: £519 (42 payments)
  • Deposit: £15,927.45 (including £4,000 deposit contribution)
  • Total amount payable by customer to buy car: £59,475.69
  • Cash price: £63,430
  • Mileage allowance: 10,000 miles per year
  • APR: 3.9%

PCP: Range Rover Velar

Best new car under £500 a month for: svelte SUV looks

2019 Range Rover Velar

If you're after a super posh, super in vogue hunkered-down SUV, the Velar should fit the bill. Despite being a bit lower than the Range Rover norm, it's still elevated enough for you to lord it over more humble cars - surely the core appeal of any Range Rover.

The P250 is the least powerful petrol engine on offer, but it's not what you'd call slow. 0-62mph comes up in 6.4 seconds.

It feels large from behind the steering wheel, but in all other aspects the Velar is a surprisingly rewarding SUV that cossets the driver, and really makes everyone who rides in it feel special.

Range Rover Velar P250 S PCP deal

  • Monthly cost: £499 (48 payments)
  • Deposit: £8,287 (including £4,000 deposit contribution)
  • Total amount payable by customer to buy car: £57,699
  • Cash price: £51,695
  • Mileage allowance: 10,000 miles per year
  • APR: 4.9%

PCP: Porsche 718 Boxster

Best new car under £500 a month for: fun in the sun

2019 Porsche 718 Boxster

This may well be the entry level Porsche, but the 718 Boxster (nee Boxster) is still a mid-engined two-seat roadster that gives drivers a higher pulse than a kid with a Disneyland ticket in their left hand and a can of Red Bull in their right.

Yes, enthusiasts will tell you it's sorely missing the six-cylinder engine of the old car (in this one it's a four-cylinder) but it'll still do 0-62mph in 4.9seconds, and near-perfect weight distribution means highly impressive cornering levels. Badge appeal is off the scale too.

Porsche 718 Boxster PCP deal

  • Monthly cost: £469.55 (35 payments)
  • Deposit: £10,900
  • Total amount payable by customer to buy car: £55,785.35
  • Cash price: £49,561
  • Mileage allowance: 10,000 miles per year
  • APR: 6.3%

What to read next - car finance

Want to know more about car finance? Check out our video guides explaining what PCP finance ishow PCH leasing works, and whether Hire Purchase is for you. Take a gander at our car finance calculator to see how much you can afford to borrow. Or if you're looking at leasing, check out the Parkers personal leasing search tool.

Still perplexed by car finance? The articles below may help:

** These deals are indicative examples of some packages available as at 25 February 2020, but are subject to change without prior notice. Everyone's financial circumstances are different and the availability of credit is subject to status. Terms, conditions and exclusions apply. Parkers cannot recommend a deal for you specifically. Bauer Consumer Media Limited is an appointed representative of ZenAuto Limited for the broking of regulated consumer hire agreements. ZenAuto Limited is authorised and regulated by the Financial Conduct Authority. ZenAuto Limited's registered office is Number One, Great Exhibition Way, Kirkstall Forge, Leeds LS5 3BF. ZenAuto Limited's company registration number is 10967345. ZenAuto is the trading name of ZenAuto Limited.