classic car market

[pmmeaney]

My basic impression is that the classic car market is going to take a major hit with all of the other major asset categories. Some of my close friends claim that the really valuable cars will retain their value, while those of more questionable provenance will suffer. My take is that this is unfolding similarly to the national housing market. The low end being hit hard and early (i.e. subprime market) with the higher end prices being fairly sticky since high net worth people can withstand the financial onslaught longer. But ultimately, even those markets will crumble.

I'm curious about opinions of others on this market.

[metalman]

Re: classic car market

My basic impression is that the classic car market is going to take a major hit with all of the other major asset categories. Some of my close friends claim that the really valuable cars will retain their value, while those of more questionable provenance will suffer. My take is that this is unfolding similarly to the national housing market. The low end being hit hard and early (i.e. subprime market) with the higher end prices being fairly sticky since high net worth people can withstand the financial onslaught longer. But ultimately, even those markets will crumble.

I'm curious about opinions of others on this market.

pretty simple, really... no jobs. no money. no fill-in-the-blank market... classic cars, classic motorcycles, classic paintings, classic coins, anything with a premium over it's need-to-have value.

antique road show of the future...

'how much do you think this 1837 grass figurine from india is worth that you found in the attic that your dad picked up in france after the war?' asks the dealer/appraiser.

'gosh i dunno!' replies the owner hopefully.

'looks like it's worth about five bucks, right? well... it is. you shoulda sold it during the bubble in everything', shrugs the appraiser.

[BigLandbaron]

Re: classic car market

Classic/Muscle cars were definitely caught up in the credit bubble just like art, antique Harley's and everything else. Mecum and other auctions are showing lower bid/sold prices for most classic cars over the past year. I agree the rarest, most desireable cars will likely hold their value. Clones, questionable provenance cars and generic old cars should continue to see healthy price declines from their peak.

I have a 1972 Chevelle SS 454 that I foolishly bought as an investment in 2005. It was worth in the area of $25K+ until early last year ... I'd be lucky to get $20K today (even with a new GM ZZ502 crate motor that replaced the blown 454 original).

In the long run I'm not at all crying about it ... the feeling I get behind the wheel is ... :cool: :cool: EXHILARATING :cool: :cool: !!! Feel like a BAD A**ED teenager/early 20's guy without a care in the world while I'm driving it (except one eye always on the gas gauge). As long as gas is around $2 a gallon, it's not too expensive to enjoy 3000-5000 miles a year.

I intend to keep it even though it will lose more value in the next few years. Much roomier than living in a Corolla. :rolleyes:

[metalman]

Re: classic car market

Classic/Muscle cars were definitely caught up in the credit bubble just like art, antique Harley's and everything else. Mecum and other auctions are showing lower bid/sold prices for most classic cars over the past year. I agree the rarest, most desireable cars will likely hold their value. Clones, questionable provenance cars and generic old cars should continue to see healthy price declines from their peak.

I have a 1972 Chevelle SS 454 that I foolishly bought as an investment in 2005. It was worth in the area of $25K+ until early last year ... I'd be lucky to get $20K today (even with a new GM ZZ502 crate motor that replaced the blown 454 original).

In the long run I'm not at all crying about it ... the feeling I get behind the wheel is ... :cool: :cool: EXHILARATING :cool: :cool: !!! Feel like a BAD A**ED teenager/early 20's guy without a care in the world while I'm driving it (except one eye always on the gas gauge). As long as gas is around $2 a gallon, it's not too expensive to enjoy 3000-5000 miles a year.

I intend to keep it even though it will lose more value in the next few years. Much roomier than living in a Corolla. :rolleyes:

what an awesome car!

[BigLandbaron]

Re: classic car market

Thanks Metalman! I think I will look great living in it in my retirement years!

Or ... if you think you might look even better in it than me ... I'd consider trading it for a few of those nice gold coins you have to add to my own stash!

[GRG55]

Re: classic car market

...Some of my close friends claim that the really valuable cars will retain their value, while those of more questionable provenance will suffer. My take is that this is unfolding similarly to the national housing market. The low end being hit hard and early (i.e. subprime market) with the higher end prices being fairly sticky since high net worth people can withstand the financial onslaught longer. But ultimately, even those markets will crumble.

I'm curious about opinions of others on this market.

Past performance is not indicative of future returns, as the disclaimer goes, but history says you are going to be right. Assume your close friends own some of these "really valuable cars"?

The same arguments are advanced for every grossly inflated market as it turns. If you were in London, UK late last year you would have heard much talk about how the "trophy" real estate [the "really valuable properties"] in Belgravia, Chelsea, etc "always hold their value". Turns out too many of these trophy properties were mortgaged right through from stucco to studs by now unemployed financiers in the City, and their price no longer seems to be able to defy the inexorable forces of market gravity.

[BiscayneSunrise]

Re: classic car market

In the long run I'm not at all crying about it ... the feeling I get behind the wheel is ... :cool: :cool: EXHILARATING :cool: :cool: !!! Feel like a BAD A**ED teenager/early 20's guy without a care in the world while I'm driving it (except one eye always on the gas gauge). As long as gas is around $2 a gallon, it's not too expensive to enjoy 3000-5000 miles a year.

Don't worry about the gas. As my dad used to say when motorboating: Boating is expensive but pushing up the throttles, which is really the part that gives you the most pleasure, is really the cheapest part of ownership.

Happy Motoring!!

[BigLandbaron]

Re: classic car market

Assume your close friends own some of these "really valuable cars"?

There are a handful old high school friends that had passion for classic muscle cars from the '70s that still keep in touch with, most of their classic cars would be considered "daily driver" quality or better, a couple were rotisseried. What's your definition of valuable?

I'm not what I would call a car fanatic or big collector, just someone who wanted an investment that I would really enjoy and was likely to hold it's value or appreciate over time. I've bought so much new stuff over the years that depreciated so fast, what an idiot. If you bought these cars right, you should at least break even when you go to sell it ... in the old economy. There is a bigger potential downside for some of these investments now.

[Quincy K]

Re: classic car market

Classic/Muscle cars were definitely caught up in the credit bubble just like art, antique Harley's and everything else. Mecum and other auctions are showing lower bid/sold prices for most classic cars over the past year. I agree the rarest, most desireable cars will likely hold their value. Clones, questionable provenance cars and generic old cars should continue to see healthy price declines from their peak.

I have a 1972 Chevelle SS 454 that I foolishly bought as an investment in 2005. It was worth in the area of $25K+ until early last year ... I'd be lucky to get $20K today (even with a new GM ZZ502 crate motor that replaced the blown 454 original).

In the long run I'm not at all crying about it ... the feeling I get behind the wheel is ... :cool: :cool: EXHILARATING :cool: :cool: !!! Feel like a BAD A**ED teenager/early 20's guy without a care in the world while I'm driving it (except one eye always on the gas gauge). As long as gas is around $2 a gallon, it's not too expensive to enjoy 3000-5000 miles a year.

I intend to keep it even though it will lose more value in the next few years. Much roomier than living in a Corolla. :rolleyes:

the bubble in muscle cars was almost as big as housing. Body-on restored BB(non-hemi or six-pack) Mopars were going for 75k+.

i would assume they are going for half that right now. On a good day.

a 1971 or 72 ss454 coupe never had collector value. Never will. a 1970 LS-6 ss454 coupe or convertible does, but they are probalby down half from the peak right now as well. be happy you never bought one of those(100k;250k, respectively). sounds to me like you already covered your losses through utilitarian value.

[GRG55]

Re: classic car market

There are a handful old high school friends that had passion for classic muscle cars from the '70s that still keep in touch with, most of their classic cars would be considered "daily driver" quality or better, a couple were rotisseried. What's your definition of valuable?

I'm not what I would call a car fanatic or big collector, just someone who wanted an investment that I would really enjoy and was likely to hold it's value or appreciate over time. I've bought so much new stuff over the years that depreciated so fast, what an idiot. If you bought these cars right, you should at least break even when you go to sell it ... in the old economy. There is a bigger potential downside for some of these investments now.

My definition of the "really valuable cars" is the stuff you see at Pebble Beach...the stuff that was bid up into the stratosphere in recent years, just like modern art, because there was too much credit chasing everything. Some of the prices paid at Barrett-Jackson in recent years are completely silly.


My definition of a great drive is:

• anything you don't have to mortgage yourself in order to acquire and restore [which means there were probably lots of them built originally];
• is now unique enough from attrition of the fleet that a well turned out example gets some attention;
• makes you want to get behind the wheel and get it out of the garage, even if just to run down to Walgreens.

Once I get my shop finished [that's my avatar pic] I have a couple of restoration projects...first up a frame-up on a 1961 MGA roadster. It's all original, including the knock off wires. Not including my labour I figure I'll have it on the road in showroom condition [including the factory-original oil leaks ] for less than $15,000 [Canadian $]; that includes the original acquisition price.

[BigLandbaron]

Re: classic car market

My definition of the "really valuable cars" is the stuff you see at Pebble Beach...the stuff that was bid up into the stratosphere in recent years, just like modern art, because there was too much credit chasing everything. My definition of a great drive is:

• anything you don't have to mortgage yourself in order to acquire and restore [which means there were probably lots of them built originally];
• is now unique enough from attrition of the fleet that a well turned out example gets some attention;
• makes you want to get behind the wheel and get it out of the garage, even if just to run down to Walgreens.

One friend did a rotisserie 'cuda and sold it for around US$125K in 2005 (dunno what he had into it, maybe $40K+ labor). That was the only +US$100K car I can think of that my local buddies ever had. I'm in Maine ... not many original survivor cars here, most are brought up from southern US.

I'd say my Chevelle (Georgia car, no rust ever) qualifies as a great drive using your above definition. I paid cash, parts are readily available and it's a good looking ride plus makes a hot lap to WalGreens highly enjoyable!. That was enough to sell me in 2005 ... that and thinking it would at least hold it's value (looks like that was a bad assumption). I hope to enjoy it for years to come and worry about what it's actually worth when I sell it.

[GRG55]

Re: classic car market

...I'd say my Chevelle (Georgia car, no rust ever) qualifies as a great drive using your above definition. I paid cash, parts are readily available and it's a good looking ride plus makes a hot lap to WalGreens highly enjoyable!...

I'd agree. Enjoy, and forget about what you paid. It may not feed your family, but it'll bring more daily joy than a fistful of Krugerands.

[rj1]

Re: classic car market

The most recent Barrett-Jackson car auction in Phoenix in February, Speed said business was down some but it wasn't like it was a colossal crash, maybe down something like 5-10%, which for a hobby business just makes you shrug.

[BigLandbaron]

Re: classic car market

The most recent Barrett-Jackson car auction in Phoenix in February, Speed said business was down some but it wasn't like it was a colossal crash, maybe down something like 5-10%, which for a hobby business just makes you shrug.

Down 5% - 10% ... was that regarding sales volume (% of cars offered vs sold), bid pricing for similar cars (off from last year or peak), total sales $$$ or attendance $$$ or what ??? I hate unspecific statistics !

There are a lot of inflated "hobbies" out there with folks hanging on to their past peak value (just like house values). These classic car owners/dealers are generally "buy and hold" type folks that only sell if they get top dollar ... or get into a financial pinch. These cars (and other collectibles) were presumed to be a high quality store of value in the old economy. I am interested in how this story eventually ends.

Side Note: I've noticed a lot of beanie babies and other collecting phenomema from the somewhat recent past for sale REAL CHEAP on craigslist and similar sites. I'm not an economist ... but it appears the least resilient stores of perceived value are the first to go, eh?! Perceived value of collectibles ... much like a fiat currency.

[cjppjc]

Re: classic car market

Side Note: I've noticed a lot of beanie babies and other collecting phenomema from the somewhat recent past for sale REAL CHEAP on craigslist and similar sites. I'm not an economist ... but it appears the least resilient stores of perceived value are the first to go, eh?! Perceived value of collectibles ... much like a fiat currency.

Yes indeed.