When can the classic car price bubble crash?

[DonkeyApple]

elms said:

People have been calling the top of the market for the last 5 years now.

I think that the continual price rises (whether fast or slow) are how it's going to be from now on, and their won't be a crash as it seems a lot of people really want to see.

The key element to support that lies with our current demographic quirk of having the richest pensioners ever in history and for them to also be the richest demographic. As such, when rates rise, if they are still alive then their incomes will rise and thus their spending power.

It's an interesting quirk that for the first time in history, raising rates to curb spending, ergo inflation, could actually have the opposite effect as this enormous demographic will be getting a pay rise each time rates increase and feeling more and more financially secure.

[vpr]

elms said:

People have been calling the top of the market for the last 5 years now.

I think that the continual price rises (whether fast or slow) are how it's going to be from now on, and their won't be a crash as it seems a lot of people really want to see.

Indeed........and we know at least one of those Town Criers

[elms]

The other aspect is how expensive normal cars are to buy. For example a chum of mine has on order a Ford Mondeo Vignale top of the range etc etc. He works for Ford so it's a company car and he has ticked every single option there is.

List price........£40k

Yes forty thousand pounds for a Mondeo. Admittedly I'm sure most savvy buyers will get a discount off that, or the real price is lost in the world of cheap FMC finance deals or lease plans.

But with that in mind, is a say Sierra RS500 (a bona fide piece of history from the same manufacture) really that expensive at £80k?

And that is just an example from Ford, I've just taken a look a BMW 520d M sport with no options has a base, yes base price of £40k. Pop on a few must have options, paint, nice wheels etc and you'll have a depreciating 2000cc diesel Euro bore box that's probably knocking on the door of £50k f

Edited by elms on Sunday 27th November 11:02

Edited by elms on Sunday 27th November 11:06

Edited by elms on Sunday 27th November 11:08

[_Leg_]

vpr said:

elms said:

People have been calling the top of the market for the last 5 years now.

I think that the continual price rises (whether fast or slow) are how it's going to be from now on, and their won't be a crash as it seems a lot of people really want to see.

Indeed........and we know at least one of those Town Criers

Thread started in June 2015, it's now the end of 2016 and nothing has changed.

Some people think that prices are mad because they still think of these things as cars. This is no longer the case. Collectible cars have moved into the same realm as stamps, art etc where normal rules no longer apply.

A dress worn by Marilyn Monroe recently sold for $4,800,000 US. It sold for $1,267,500 US in 1999. That makes the price increases in collectible cars look extremely tame.

This painting reportedly sold for $300,000,000.



A 250 GTO sold for $38,115,000 in 2014. I know what I would rather have and it's red, shiny, very shouty and would have $261,885,000 in change in the boot too. Nice.

Edited by _Leg_ on Sunday 27th November 11:54

[mph]

Hope I can get my series 1 E type finished and sold before the crash. It's my pension fund

[RichB]

_Leg_ said:

This painting reportedly sold for $300,000,000.

Wow, I'm sure my in-laws have got that hanging over their fireplace.

[RichB]

mph said:

Hope I can get my series 1 E type finished and sold before the crash. It's my pension fund

That's a shame. Surely the idea is to keep these cars so you can enjoy them in retirement not have them while you're working and sell them once you have the time to enjoy them?

[_Leg_]

RichB said:

mph said:

Hope I can get my series 1 E type finished and sold before the crash. It's my pension fund

That's a shame. Surely the idea is to keep these cars so you can enjoy them in retirement not have them while you're working and sell them once you have the time to enjoy them?

I think he's joking.

If you bought your car/s to make money, because if you didn't then it's irrelevant, what are you going to do with the money once you have it?

Let's say you have a £100,000 car. You turn it into cash today. What are you doing with the cash?

Personally I own my cars because I knew what I wanted to spend my most valuable resource, time, doing. How much entertainment and pleasure I get from my cars is not linked to the value, but I think the question of what you would do with your money if you sold your car/s is an interesting one.

'You' meaning anyone rather than Rich or mph specifically.

[Prohibiting]

Call me stupid but why is that painting worth 300 million dollars?

[_Leg_]

Prohibiting said:

Call me stupid but why is that painting worth 300 million dollars?

Same as anything is worth anything. Someone wanted it and they had $300M and feck all better to do with the money.

I wouldn't give a tenner for the painting myself, it's bloody awful.

[V8 FOU]

RichB said:

Wow, I'm sure my in-laws have got that hanging over their fireplace.

Isn't that one of the posters sold in Boots in the 70's?
Damn, should have bought it for 12/6 then......

[RichB]

_Leg_ said:

RichB said:

mph said:

Hope I can get my series 1 E type finished and sold before the crash. It's my pension fund

That's a shame. Surely the idea is to keep these cars so you can enjoy them in retirement not have them while you're working and sell them once you have the time to enjoy them?

I think he's joking.

If you bought your car/s to make money, because if you didn't then it's irrelevant, what are you going to do with the money once you have it?

Let's say you have a £100,000 car. You turn it into cash today. What are you doing with the cash?

Personally I own my cars because I knew what I wanted to spend my most valuable resource, time, doing. How much entertainment and pleasure I get from my cars is not linked to the value, but I think the question of what you would do with your money if you sold your car/s is an interesting one.

'You' meaning anyone rather than Rich or mph specifically.

Indeed agree with all that and no, I hadn't picked up on the "wink" at the end of MPH's post. I replied in haste.

[GOG440]

Prohibiting said:

Call me stupid but why is that painting worth 300 million dollars?

Because some one with very deep pockets was daft enough to buy it.
No other reason, not even a particularly attractive painting IMO

[_Leg_]

GOG440 said:

Prohibiting said:

Call me stupid but why is that painting worth 300 million dollars?

Because some one with very deep pockets was daft enough to buy it.
No other reason, not even a particularly attractive painting IMO

Rumoured (the Art world is quite secretive) to have been bought by Qatar. Along with The Shard, Olympic Village, FIFA, a load of canary Wharf, Sainsbury's,20% of the London Stock Exchange, 20% of Camden Market etc etc

Stocking up on valuable stuff ready for when the oil runs out. When I'm ready to sell my collection I think I'll advertise the cars in the Qatar edition of Auto Trader.

[anonymous-user]

Talking from the budget end of classic cars here (under £20k) but everything I've bought over the years I start off thinking I will never sell but in my case 10 years down the line I lose a bit of interest and fancy something different it's nice to know that it has gone up in value to help fund whatever next, so in my case it does bother me that prices increase on the classic I own because I know at some point the novelty will wear off.

[_Leg_]

Strong results at the recent Historic at Brooklands Auction. Examples below:

http://www.historics.co.uk/buying/auctions/2016-11...

http://www.historics.co.uk/buying/auctions/2016-11...

http://www.historics.co.uk/buying/auctions/2016-11...

http://www.historics.co.uk/buying/auctions/2016-11...

[vpr]

I still maintain, there will always be record prices paid for original low mileage (hence rare) cars of any ilk

So, buy the very best you can afford

[mph]

vpr said:

I still maintain, there will always be record prices paid for original low mileage (hence rare) cars of any ilk

So, buy the very best you can afford

Agree. The number of rare cars is finite, the number of collectors and enthusiasts is not.

Let's face it, the vast majority of classic cars are still affordable and are bought by enthusiasts.

In my opinion there are still several classics that remain undervalued and even more that offer good fun/value ratio. Cars bought purely for investment form a very small part of the market.

[SDB660]

"Cars bought purely for investment form a very small part of the market"

Not sure about that. My recent experience suggests there is a massive amount of "leverage" out there. From £2 million plus collections bought on the strap, to a sole pensioner persuading his wife to use a bit of pension to get an indulgence that is also an investment. Don't get me wrong. Want it to continue and recent auction results have been very positive. Just don't believe that anything continues on an upward trajectory forever.

Edit: This market has been going up for almost 20 years. A good run by any standard.

[Doofus]

mph said:

The number of rare cars is finite, the number of collectors and enthusiasts is not.

To be fair, the number of collectors and enthusiasts is finite. And as the 'investment' money continues to commoditise classics, and to define ever increasing values, the number of collectors and enthusiasts will inevitably decline.

We have a two-tier market now, like never before. It's always been there, but is now further exaggersted. At the top end there sre buyers who are just as happy to out their money into art, or jewellery, or whatdver is on the rise. As they pay ever inflated prices for rare metal, they srt a new benchmark which, global economy allowing, more or less guarantees a profit. How do you objectively value a car, when only ten exist? You value it by what sombody paid for one the last time it sold.

That end of the market is largely insulated from the 'enthusiast' market - which can still carry some very big values, but there comes a point at which more logical and practical considerations tell you where the value should be.

Edited by Doofus on Sunday 27th November 19:31