usctrojanGT3

I found this article very interesting and just confirms that the market is frothy and filled with speculators and leverage. The following exert really caught my attention...

"We're seeing more complex transactions and trends, such as 1031 exchanges, asset-backed lending, and auction houses giving credit lines on future purchases or sales,"

I got a chill in my spine and a flashback of what happened with the housing market in 2008-2009. Bad things will happen when (not if) the "punch bowl" of liquidity gets taken away.

http://www.cnbc.com/2015/12/05/jay-l...overdrive.html

Steven_H

Interesting read. Concerning Porsches, the article is inaccurate about 1994 Turbos going from $50k to $300k in 9 months. The high priced Turbo was a 94 Turbo 3.6, relatively rare, in perfect condition, and a great color.

I agree about the dangers of the speculators who hire general advisors to put together collections. Access to truly collectible cars comes through long-developed connections. Truly rare Porsches (fewer than 50 made) rarely are traded publicly as in most cases people who have them know the people who want them.

As to source of funds to buy them - whether a collector or investor - asset backed loans (margin loans) are currently at less than 2% per year. One is much better off maintaining other, higher earning investments and using margin loans to buy cars, especially if the investment is not very long term.

MM3.9GT3

The first sign of the bubble popping is cars just sitting, and not selling. We are in that phase. The price increases over the last five years are unrealistic, unsustainable, and speculative. When any asset class doubles, triples, or quadruples in a short amount of time, very bad things happen.

Buy what you can afford, drive them, and enjoy them. Just don't listen to speculators within Rennlist, or outside Rennlist.

Spyerx

Bad things only happen to those who buy these cars as investments and less face it if the car is built in/after the 80s and has more than a few k miles it's not investment class. As stated above the truly investment cars are very well known and trade behind the scenes of auto trader and rennlist

The rest of us have awesome cars to drive. Candidly so what if my g body halves in value. I'm already better off had I bought a new car anyway and I have a car to enjoy, not a stock sitting in my account or a painting on my wall.

To add fuel to the fire... A collector (real one, real rare cars, vintage factory race cars with significant history, etc) was at the shop the other day. His comment: market has and is cooling across the board. His reaction? Seek additional rare pieces for his collection.

fxz

Houses are still being
produced

whilst "classic" whatever
model not obsessed with
fuel consumption
are very shortly going to
disappear like the dynosaur

while houses are still the same after 2008

991 GT3

I am a Financial Advisor and I see clients all the time wanting to pay super inflated prices because of what Has happened, upward pricing trends or rear view mirror approach. Buying on emotion is an enemy to a pragmatic and logical approach. You should buy when others are selling and sell when others are buying. Right now, anyone desperate to pay extreme premiums will likely get stung, very seldom is this not the case. Patience is a critical and beautiful thing. If I can't get what I want at a fair price then I move on. If I can buy low or at a good value, gut check for most in stock market, then I feel very good as long as I have a realistic view of future expectations. The RS craze will likely soften and that's when it's time to pounce. Sometimes it takes awhile to flesh out but it's Not If its When! My .02

Steven_H

I think we are confusing collector / investor cars with new cars. I agree that to buy a new car as an investment is likely foolish. That said, at a recent seminar about collector cars, one of the panelists asked the participants how old the first collector car was when they bought it. No one had chosen a fifty year old car, few a 40 year old one. Most had bought cars about 25 years old when they got them. Makes sense - if most collectors bought their first collector car when they were in their early 40s, the cars would have been new when they were 15-16 years old - adolescent dream cars. Which goes a long way to explain the increased interest in 1990's Porsches like the 94 Turbo mentioned in the article that started all this. Interestingly, in the next few years, it will be legal to import 1992 964RSs without modification. Already the rare versions like the 964RS 3.8 can be imported under show and display. Most 993 GT2s can come in next month - also under show and display. Although these are likely decent investments, the 964RS is an incredible car to drive and values are less vulnerable to mileage than later RSs with no mileage. It may be possible to have cars that are not only good investments (cheap to own) but also fantastic to drive. Just may need to keep them until they are 25 years old

usctrojanGT3

We'll know when we are edge at the cliff once you hear about some kind of "classic car" trading stock/investment fund. Good thing I'm a non-collector who likes to drive all of my cars.

Steven_H

Funds already exist. Luckily they are mostly interested in Italian cars.

porscheflat6

Great article, thanks for sharing

JEI-Porsche

There is no substance to this article, no new information, no reason why it may or may not be a bubble, just speculation of a near bubble and basically that you need O'Dell to help you.

maine992

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