The simple reason classic car prices WILL fall (Video)
08-02-2018, 02:19 PM
#31
Rennlist Member
Equity in the garage...lol.
You couldn't build my car for 150k...and i couldn't likely sell it above 55k...
Further - if you bought one today for 55k, in a few years, almost without question you'll have another 20k in...
We are all much better off - if the car is for investment purposes, just buying Apple stock and being done. Or swap the word Apple for whatever you like. But you get the point. It's about the fun and not about the value increase.
You couldn't build my car for 150k...and i couldn't likely sell it above 55k...
Further - if you bought one today for 55k, in a few years, almost without question you'll have another 20k in...
We are all much better off - if the car is for investment purposes, just buying Apple stock and being done. Or swap the word Apple for whatever you like. But you get the point. It's about the fun and not about the value increase.
I meant equity in the garage as in it's increasing in value, or even just staying flat or modest inflation increases. Something that if the sh*t ever hit the fan, you could recoup more of your money out of it - even in your case, you are getting back $.33 on the dollar if you have spend $150k on it. I built a lot of stupid cars (looking back) in my teenage and young adult years, big stereos, gaudy wheels, metalflake paint - loved them at the time, but if I had held on to them, they would have depreciated into almost nothing today. Literally pennies on the dollar. Whereas my old 3.2, had I kept it from way back then, would have been worth more today.
08-02-2018, 02:57 PM
#32
This one's for everyone that says our cars shouldn't be investments (that would include me). Recently German bankers have suggested vintage cars as an alternative to low interest rates.
https://www.bloomberg.com/news/artic...akers-homeland
https://www.bloomberg.com/news/artic...akers-homeland
Bankers in Germany’s automotive heartland have a recommendation for investors seeking alternatives to low interest rates: vintage cars from their region.
“For customers with more than 1 million euros in liquid assets, a classic car can be an attractive addition to their portfolio in terms of yield and value stability,” Jens Berner, vintage car expert at Suedwestbank AG’s asset management unit, said in an interview. “After the financial crisis, requests for alternative investments such as art, wine or classic cars had risen sharply.”
To better compare vintage cars with other asset classes, the bank some time ago started the OTX Classic Car Index, comprised of vehicles that are at least 30 years old and come from manufacturers in southern Germany where Suedwestbank is based, such as Audi, BMW, Daimler and Porsche. From the start of 2005 to the beginning of 2018, the OTX quadrupled, easily beating the 204 percent gain for Germany’s main stock index DAX.
Suedwestbank, which is part of Bawag Group AG, an Austrian lender partially owned by Stephen Feinberg’s Cerberus Capital Management, calculates the index once a year by multiplying model prices provided by specialist magazine Motor Klassik with registration numbers from the Federal Motor Transport Authority. The 20 cars with the highest values make up the index.
The OTX isn’t the first classic car index in Germany, but it focuses on the country’s prosperous south, where the big luxury carmakers are based. Owners of Porsche 911 classic cars were especially fortunate, with cars in that model series increasing almost eight-fold -- 683 percent -- in value in the past 13 years.
Good Investments Possible
“Classic cars can be a good investment if you buy the right car at the right time and at the right price,” said Frank Wilke, managing director of vintage car market observer Classic-Analytics.
Caution should always be exercised with classic car investments, said Berner, especially now with prices being rather high. He advises that investors always consult an expert.
“Counterfeits are a big issue, for example when a vintage car is first disassembled into individual parts and then re-assembled into two cars by mixing it with some new parts,” he said. “If there are suddenly 300 cars on the market of a series of which only 200 were originally built, then something is wrong.”
Liquidity Depends on Model
Liquidity, too, can be a problem, depending on the model.“For some vehicles, there are only a few potential buyers, but for others, such as the Porsche 911, the market is relatively large,” he said.
He advises customers to invest only in vintage cars with a minimum value of 100,000 euros. At lower prices, the cost for expert reports, taxes, insurance, storage and maintenance are proportionally bigger drags on the return, he said. At most, a classic car should make up 10 percent to 15 percent of a portfolio.
“If you have a good stock, some say it’s best to put it into a safe for five years and see how it has developed,” said Rainer Dschuedow, managing director at classic car marketplace Pyritz Classics. “You should also handle a classic automobile this way. If your darling remained stable or did gain in value, you should be happy.”
“For customers with more than 1 million euros in liquid assets, a classic car can be an attractive addition to their portfolio in terms of yield and value stability,” Jens Berner, vintage car expert at Suedwestbank AG’s asset management unit, said in an interview. “After the financial crisis, requests for alternative investments such as art, wine or classic cars had risen sharply.”
To better compare vintage cars with other asset classes, the bank some time ago started the OTX Classic Car Index, comprised of vehicles that are at least 30 years old and come from manufacturers in southern Germany where Suedwestbank is based, such as Audi, BMW, Daimler and Porsche. From the start of 2005 to the beginning of 2018, the OTX quadrupled, easily beating the 204 percent gain for Germany’s main stock index DAX.
Suedwestbank, which is part of Bawag Group AG, an Austrian lender partially owned by Stephen Feinberg’s Cerberus Capital Management, calculates the index once a year by multiplying model prices provided by specialist magazine Motor Klassik with registration numbers from the Federal Motor Transport Authority. The 20 cars with the highest values make up the index.
The OTX isn’t the first classic car index in Germany, but it focuses on the country’s prosperous south, where the big luxury carmakers are based. Owners of Porsche 911 classic cars were especially fortunate, with cars in that model series increasing almost eight-fold -- 683 percent -- in value in the past 13 years.
Good Investments Possible
“Classic cars can be a good investment if you buy the right car at the right time and at the right price,” said Frank Wilke, managing director of vintage car market observer Classic-Analytics.
Caution should always be exercised with classic car investments, said Berner, especially now with prices being rather high. He advises that investors always consult an expert.
“Counterfeits are a big issue, for example when a vintage car is first disassembled into individual parts and then re-assembled into two cars by mixing it with some new parts,” he said. “If there are suddenly 300 cars on the market of a series of which only 200 were originally built, then something is wrong.”
Liquidity Depends on Model
Liquidity, too, can be a problem, depending on the model.“For some vehicles, there are only a few potential buyers, but for others, such as the Porsche 911, the market is relatively large,” he said.
He advises customers to invest only in vintage cars with a minimum value of 100,000 euros. At lower prices, the cost for expert reports, taxes, insurance, storage and maintenance are proportionally bigger drags on the return, he said. At most, a classic car should make up 10 percent to 15 percent of a portfolio.
“If you have a good stock, some say it’s best to put it into a safe for five years and see how it has developed,” said Rainer Dschuedow, managing director at classic car marketplace Pyritz Classics. “You should also handle a classic automobile this way. If your darling remained stable or did gain in value, you should be happy.”
08-02-2018, 04:25 PM
#33
Race Car
There are a couple of those out there...funds that try to act as some kind of consolidated investment vehicle.
I know there is a sucker born every minute. And i understand the idea and applaud the attempt. But seriously...if any of my clients wanted to push me to add that to their portfolio, I'd likely fire them. Lol. I really don't like that idea at all. Allocate a little money for fun...but for God's sake, don't bet the farm on some hokum idea to park a bunch of cars in a garage and make a fund that tracks their value. Ugh. Cars that sit, rot and break themselves. Cars that don't sit, cost enormous amounts of money to maintain over time. Not to mention carry costs...Imagine the long term fees those funds will have to charge?
If in 20 years i am wrong, we will have a drink and laugh...
I know there is a sucker born every minute. And i understand the idea and applaud the attempt. But seriously...if any of my clients wanted to push me to add that to their portfolio, I'd likely fire them. Lol. I really don't like that idea at all. Allocate a little money for fun...but for God's sake, don't bet the farm on some hokum idea to park a bunch of cars in a garage and make a fund that tracks their value. Ugh. Cars that sit, rot and break themselves. Cars that don't sit, cost enormous amounts of money to maintain over time. Not to mention carry costs...Imagine the long term fees those funds will have to charge?
If in 20 years i am wrong, we will have a drink and laugh...
Last edited by Goughary; 08-02-2018 at 04:44 PM.
08-02-2018, 10:42 PM
#34
Very soon all new cars will be electric, the 2019 911 is almost all digital from the driver's seat. What do we do for smiles then?
I have been around for a few "corrections" in the classic car market, always seems to recover, nicer cars first.
For the life of me, I cannot equate my 964 as an investment, any more than I can keep a running tally of what my wife's Cartier watch is worth. As Oscar Wilde once said "he knows the cost of everything and the value of nothing".
Drive the damn car and keep it nice for your kids.
I have been around for a few "corrections" in the classic car market, always seems to recover, nicer cars first.
For the life of me, I cannot equate my 964 as an investment, any more than I can keep a running tally of what my wife's Cartier watch is worth. As Oscar Wilde once said "he knows the cost of everything and the value of nothing".
Drive the damn car and keep it nice for your kids.
08-02-2018, 10:50 PM
#35
Race Car
We have a fun electric 964 project going on somewhere here in rennlist...
He will have the only one that survives the correction. If he uses a battery you can buy on amazon and plug it in without getting the "millennial hands dirty"
What are we going to call the kids of the millenials?
He will have the only one that survives the correction. If he uses a battery you can buy on amazon and plug it in without getting the "millennial hands dirty"
What are we going to call the kids of the millenials?
08-03-2018, 12:32 AM
#36
Rennlist Member
Totally agreed. He is assuming that collectors want to collect new cars and that these new cars will substitute the older cars just because they carry the same name... If so then as an extreme case all the new GTOs would have caused the original 250GTO to decline. But no.... A 250 GTO will never be replaced by a 288GTO will never be replaced by a 599GTO as far as the collector is concerned. Likewise a 2.7 RS wil never be substituted by a 991 RS for the collector. He sadly has no idea what he is talking about.
08-03-2018, 01:59 AM
#37
Rennlist Member
I don't normally comment on automotive media, as it feels a bit odd to given my profession in it, but this is a case where I'm pained enough to do so. I hate it when I see such poorly researched material being rolled out as fact—especially to get to questionable conclusions.
"1,135" examples of Carrera RS 2.7 & Carrera RS 3.0? They made 1,525 examples of the RS 2.7 alone. Add in the RS 3.0 (and/or road-legal RSR 2.8) and the number is off by something most of the way toward 50%. This production info is hardly "rare" or hard to obtain, and I have questions about the other production numbers quoted. I couldn't watch continuously after that, but does he deal with production numbers vs new markets/rising population/car usage/etc?
For me, the greater wisdom/takeaway is found here, on this thread. And that is: When the price of Porsches rather than the value (utility) becomes the discussion, I become less interested. A lot less. My 1973 914 (a 914!) hot rod is probably worth a sum not so long ago unimaginable to me, but I'm with a poster above: I don't really view that as a good thing, as it doesn't improve the car's value (making the car more fun or easier to use or enjoy).
"1,135" examples of Carrera RS 2.7 & Carrera RS 3.0? They made 1,525 examples of the RS 2.7 alone. Add in the RS 3.0 (and/or road-legal RSR 2.8) and the number is off by something most of the way toward 50%. This production info is hardly "rare" or hard to obtain, and I have questions about the other production numbers quoted. I couldn't watch continuously after that, but does he deal with production numbers vs new markets/rising population/car usage/etc?
For me, the greater wisdom/takeaway is found here, on this thread. And that is: When the price of Porsches rather than the value (utility) becomes the discussion, I become less interested. A lot less. My 1973 914 (a 914!) hot rod is probably worth a sum not so long ago unimaginable to me, but I'm with a poster above: I don't really view that as a good thing, as it doesn't improve the car's value (making the car more fun or easier to use or enjoy).
08-03-2018, 02:12 AM
#38
Addict
Rennlist Member
Rennlist Member
The only advantage I see to increased values is that I don’t feel as bad spending money to upgrade and restore it. Seems like a good excuse and keeps my wife from complaining too much 
.
.
08-03-2018, 08:18 AM
#40
Burning Brakes
08-03-2018, 08:53 AM
#41
Rennlist Member
True although my wife keeps pushing me to sell some and cash in but I couldn't imagine what I would buy to replace them. Also my insurance premiums keep going up up up.
I was going to comment on the production numbers as well but figured it was all rubbish anyhow.
08-03-2018, 11:19 AM
#42
Three Wheelin'
I actually found that 930 prices are somehow lingering/on the downward slope.
Did they go up too soon and too fast? Some reasonably used example in the high 60s now...
Did they go up too soon and too fast? Some reasonably used example in the high 60s now...
08-03-2018, 11:52 AM
#43
Race Car
I'll just point something out...
Almost all of the recent excitement over old 911 in the past god knows how many years, has been over hot rodded or otherwise modded cars.
Aside from the Carrera RS and a few of the very low production cars...factory fresh and originality in most cases has taken a back seat to 277, singer, keen project Safari etc...
This market has run up because there are so many people that want to play with their cars and make them unique and their own...live the dream etc. moreover, it doesn't have to be about a car. Just happens the car is the choice for our market- but if you look around, same thing has happened with watches and many other "markets", but the psychology is similar.
A bull market needs to be fed. The market will be fed, but this market isn't about just the 911. The 911 happens to be the flavor of the day. The market is about the modding and making one's self something unique in a world of the six inch screen, social isolation and blandness.
Almost all of the recent excitement over old 911 in the past god knows how many years, has been over hot rodded or otherwise modded cars.
Aside from the Carrera RS and a few of the very low production cars...factory fresh and originality in most cases has taken a back seat to 277, singer, keen project Safari etc...
This market has run up because there are so many people that want to play with their cars and make them unique and their own...live the dream etc. moreover, it doesn't have to be about a car. Just happens the car is the choice for our market- but if you look around, same thing has happened with watches and many other "markets", but the psychology is similar.
A bull market needs to be fed. The market will be fed, but this market isn't about just the 911. The 911 happens to be the flavor of the day. The market is about the modding and making one's self something unique in a world of the six inch screen, social isolation and blandness.
08-03-2018, 11:53 AM
#44
Rennlist Member
I have always said it is about the right car more so than a specific model. Just as with the 73RS's which can see a huge delta in pricing.
08-03-2018, 12:09 PM
#45
Rennlist Member
I'll just point something out...
Almost all of the recent excitement over old 911 in the past god knows how many years, has been over hot rodded or otherwise modded cars.
Aside from the Carrera RS and a few of the very low production cars...factory fresh and originality in most cases has taken a back seat to 277, singer, keen project Safari etc...
This market has run up because there are so many people that want to play with their cars and make them unique and their own...live the dream etc. moreover, it doesn't have to be about a car. Just happens the car is the choice for our market- but if you look around, same thing has happened with watches and many other "markets", but the psychology is similar.
A bull market needs to be fed. The market will be fed, but this market isn't about just the 911. The 911 happens to be the flavor of the day. The market is about the modding and making one's self something unique in a world of the six inch screen, social isolation and blandness.
Almost all of the recent excitement over old 911 in the past god knows how many years, has been over hot rodded or otherwise modded cars.
Aside from the Carrera RS and a few of the very low production cars...factory fresh and originality in most cases has taken a back seat to 277, singer, keen project Safari etc...
This market has run up because there are so many people that want to play with their cars and make them unique and their own...live the dream etc. moreover, it doesn't have to be about a car. Just happens the car is the choice for our market- but if you look around, same thing has happened with watches and many other "markets", but the psychology is similar.
A bull market needs to be fed. The market will be fed, but this market isn't about just the 911. The 911 happens to be the flavor of the day. The market is about the modding and making one's self something unique in a world of the six inch screen, social isolation and blandness.
I am usually contacted by people that start out looking for original condition low mile cars they are willing to pay up for and plan to drive but are rarely found so most of these people end up buying a heavily modified car for less than they would spend on an all original car, albeit far more than the average driver would sell for.
I have found a wide spectrum of buyers with varying criteria. It is very hard to find a car for the current buyer as what is great for one isn't remotely close to what another is willing to accept or pay. In either case the air cooled market is very fickle with a wide range of people interested in specific MY cars. Interestingly we are seeing a similar growth in the 928 market with original clean examples of earlier S4's bringing what a GTS 5 speed fetched 10 years ago and the GTS's going through the roof for the right cars.