Surely leasing some 185s (if they go off lease) would be cheaper than ordering more new DMU trains?
No, it likely isn't. If they order new trains, they will still be leasing them - those costs will be based on what the leasing company thinks they're worth over the term of any lease - so a new train with guaranteed work for the foreseeable future, is quite likely to be cheaper to lease than an older train with a shorter potential use. Then you have the difference in specification, a new sprinter replacement is going to be cheaper to build and maintain than the 185's cost to build and maintain. Finally you also have the running costs - 185s are expensive to run. 195's are significantly cheaper - something that will also factor in to the return-on-investment time for the leaser of the 185's - would Northern drop the 185's as soon as something cheaper to operate becomes available?
While it may seem wasteful to throw away something halfway through it's life over something built new, that's not the way that leasing works. Leasing is all about turning capital expenditure - where you would want to eek out the maximum value for something you bought - into operation expenditure - where you only care about what it's costing you to use today. It's not Northern, Transpennine Express or any other TOC that the 185's don't have alternative uses - it's the leasing companies who actually own the stock - and if they've earnt enough money to pay for the initial outlay, then off to the scrapyard if they can't find anyone else willing to pay - they're not out of pocket.
Of course, there is also an argument that the leasing companies should do more to make their stock appealing to alternative operators, but from their point of view, if it's paid for itself, nobody wants it in it's current state, what is the point in doing so? There's a good chance they would also be better off buying new stock and leasing it for a longer period.