By Phyllis Gurgevich
As we get closer to the end of the year, many Pahrump businesses may be looking for ways to wrap up their capital expenditure budgets before closing their books for the year.
The good news is that a nationwide trend shows that capital investments are finally rebounding this year as the outlook for the U.S. economy becomes a bit clearer.
According to the recent Capex Finance Index (CFI) released by the Equipment Leasing & Finance Association, total new business volume with equipment dealers ticked up after four straight months of decline, increasing 2.5% month-over-month to reach $10.5 billion in June.
The June volume aligns with the CFI total equipment deal volume projection of $129 billion in 2026, the highest level recorded in any year since the survey began in 2006.
When balancing the need for new equipment and spending of capex budgets, the question of buying versus leasing instantly comes to mind. To find out which approach makes the most sense for you and your business, consult with your Pahrump commercial banker now for advice on using excess capital funds in a strategic equipment transaction before we ring in 2027. Here are some points to consider in the decision making:
Leasing makes sense for some construction equipment that is constantly improving with new technology and functionality. Equipment purchased can become obsolete as newer and better technology becomes available. Leased equipment can make senses when you need the newest technology for projects.
Leasing also lowers the initial capital outlay for equipment. This may allow for more equipment to be purchased with smaller capex expenditures.
Leasing also generally transfers the maintenance of the equipment to the owner, reducing the capital needed for ongoing repairs and maintenance. It may also reduce equipment down time.
On the other hand, buying makes more sense over the long term, as leasing costs tend to be higher over time than outright purchasing.
Buying also allows the company to carry the asset on its balance sheet and potentially leverage the capital equipment as collateral for bank lending.
Lastly, Pahrump companies that buy their capital equipment outright also may be able to depreciate the construction equipment on tax returns. However, firms should consult with a tax advisor to confirm this before purchasing capital equipment.
For many Pahrump companies, leasing equipment can be a smart move. However, other companies may be able to leverage purchasing their equipment outright for some financial benefits.
Phyllis Gurgevich is the president and chief executive officer of the Nevada Bankers Association. Nevada Bankers Association is the united voice of Nevada’s diverse banking industry: our members are dedicated to providing the best financial products, services and resources to drive and support economic growth, job creation and prosperity throughout the state of Nevada. For more information, visit nvbankers.org.
