When can the classic car price bubble crash?
Discussion
vpr said:
I hear people telling me that the bubble will burst so many times and strangely enough these people saying this don't own any classics.
If you really think if/when the bubble bursts that prices will fall to below where they started then you have to be on drugs
The rise occurred long before investment companies got involved, there's a lot of wealth out there still and not many places to put it.
Personally I'm in it for the love of cars and don't really care what happens but have to admit it helps my case with the war dept
Yeah well I own a classic, more than one imho, a Bentley T2 an old XK8 and a 996 C4S, and I'm telling you. However I own them because I want to own them not because I think they are going to make my fortune, quite the fIf you really think if/when the bubble bursts that prices will fall to below where they started then you have to be on drugs
The rise occurred long before investment companies got involved, there's a lot of wealth out there still and not many places to put it.
Personally I'm in it for the love of cars and don't really care what happens but have to admit it helps my case with the war dept
king reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
cardigankid said:
Yeah well I own a classic, more than one imho, a Bentley T2 an old XK8 and a 996 C4S, and I'm telling you. However I own them because I want to own them not because I think they are going to make my fortune, quite the fking reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.
What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
You have totally overlooked the supply and demand side of the classic car market. Taking your Aston example, the reason that not all old Astons are for sale at £125k is simply because some are more desirable than others, and that there are not that many available. The DB5 is better looking and more iconic that the DB6, so it will be worth more especially in 'Bond' Silver Birch. There were only 100 or so DB4 GTs made so they become more desirable still and if you want one of the beautiful Zagato ones, there were only 17 made. Which of those is your £125k aimed at? Then factor in the cost of a new Aston equivalent where the new Vantage GT12 was £250k and are all sold and are now being offered at £50k premium. king reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
People are still very willing to spend big money on cars, so I'd agree that any downturn will be gradual, but you'll never see £1m Astons dropping to £125k, or even close.
I suspect that some marques attract 'investor' more than enthusiasts and if there is ever some form of correction, those will be hit first.
My GT6 s fairly rare, only a few hundred left according to howmanyleft, but has been slightly less known than the iconic TRs. There are loads of TR6s left, and indeed i've had one and loved it, but perhaps their values have accelerated because they perhaps attract the 'investor' as much as the enthusiast.
Another example of a marque that I think might be inflated more than it should be is the E type. Went to the london classic car show yesterday and it seemed to be the 'E type' show. Really big money was being asked for good examples there. The E type is another car that's known by everyone and not just enthusiasts and I think would possibly be affected by a correction.
If I recall from when there last was a bubble and correction, E types were particularly badly hit.
As it is I don't really care what my GT6 is worth. I have personal and emotional reasons for owning one.
My big care regret was not buying a ferrari 308 that was on sale in a Bristol classic car dealership a few years ago. Provenance was it had been bought by George Michael for Andrew Ridgely and was in tip top condition with a low mileage for £20k. God knows what it would be worth now.
My GT6 s fairly rare, only a few hundred left according to howmanyleft, but has been slightly less known than the iconic TRs. There are loads of TR6s left, and indeed i've had one and loved it, but perhaps their values have accelerated because they perhaps attract the 'investor' as much as the enthusiast.
Another example of a marque that I think might be inflated more than it should be is the E type. Went to the london classic car show yesterday and it seemed to be the 'E type' show. Really big money was being asked for good examples there. The E type is another car that's known by everyone and not just enthusiasts and I think would possibly be affected by a correction.
If I recall from when there last was a bubble and correction, E types were particularly badly hit.
As it is I don't really care what my GT6 is worth. I have personal and emotional reasons for owning one.
My big care regret was not buying a ferrari 308 that was on sale in a Bristol classic car dealership a few years ago. Provenance was it had been bought by George Michael for Andrew Ridgely and was in tip top condition with a low mileage for £20k. God knows what it would be worth now.
I suspect that some marques attract 'investor' more than enthusiasts and if there is ever some form of correction, those will be hit first.
My GT6 s fairly rare, only a few hundred left according to howmanyleft, but has been slightly less known than the iconic TRs. There are loads of TR6s left, and indeed i've had one and loved it, but perhaps their values have accelerated because they perhaps attract the 'investor' as much as the enthusiast.
Another example of a marque that I think might be inflated more than it should be is the E type. Went to the london classic car show yesterday and it seemed to be the 'E type' show. Really big money was being asked for good examples there. The E type is another car that's known by everyone and not just enthusiasts and I think would possibly be affected by a correction.
If I recall from when there last was a bubble and correction, E types were particularly badly hit.
As it is I don't really care what my GT6 is worth. I have personal and emotional reasons for owning one.
My big care regret was not buying a ferrari 308 that was on sale in a Bristol classic car dealership a few years ago. Provenance was it had been bought by George Michael for Andrew Ridgely and was in tip top condition with a low mileage for £20k. God knows what it would be worth now.
My GT6 s fairly rare, only a few hundred left according to howmanyleft, but has been slightly less known than the iconic TRs. There are loads of TR6s left, and indeed i've had one and loved it, but perhaps their values have accelerated because they perhaps attract the 'investor' as much as the enthusiast.
Another example of a marque that I think might be inflated more than it should be is the E type. Went to the london classic car show yesterday and it seemed to be the 'E type' show. Really big money was being asked for good examples there. The E type is another car that's known by everyone and not just enthusiasts and I think would possibly be affected by a correction.
If I recall from when there last was a bubble and correction, E types were particularly badly hit.
As it is I don't really care what my GT6 is worth. I have personal and emotional reasons for owning one.
My big care regret was not buying a ferrari 308 that was on sale in a Bristol classic car dealership a few years ago. Provenance was it had been bought by George Michael for Andrew Ridgely and was in tip top condition with a low mileage for £20k. God knows what it would be worth now.
There's a split between "investment grade" classic cars and everything else. The top end ones are now an asset class, the same as property or stocks and shares. You even have indices.
http://www.historicautomobilegroup.com/
http://www.historicautomobilegroup.com/
Doofus said:
The danger is, as I see it, that the best cars will become mere artworks; destined to continue to change hands for whatever the buyer will pay. In the prevous big bubble, cars were bought as investments, and when the realisaton came that the gains were slowing, people got out, and just as in the stock market, that caused a mass exoduus, and ultimately a crash.
I also think one of the major factors is that uneducated investors (who would just as happily buy coffee, or sculptures, or rare teaspoons) see speculative prices being asked, and pay them, thereby inflating the perceived value of the cars they buy. There remains the common-sense, informed buyer, who knows what (within bounds) something is worth, but that ceases to have much meaning when the seller can knock the car down to any Tom, Dick or Barry for stupid numbers.
There will always be the middle ground, for want of a better name, of perfectly decent cars. Then there will also be those, as in the 1990's, who will pay vast amounts for a nut and bolt restoraton or more-or-less any car, and at the moment, they can still sell for a profit. A market will always find its level, and I think that will happen again, although this time, those upper-echelon cars will remain apart, and continue to be traded as trinkets.
It's true that the introducton of wealth from Russia, China and India has changed the picture, but fashions also change, and for those speculators for whom the article itself is irrelevant, something else shinier and more fashionable will come along eventually. Except that this 'new money' won't need to sell at a loss when the market moves, so a crash like we saw twenty-odd years ago is unlikely; more a softening of values over time.
I am particularly amused by a car for sale at the moment. Other examples go for betwen 12 and 23k. This one is up for 45 because there is a letter from the specialist owners' club saying it's worth 50. The seller is the founder of that club.
I cite this as an example of a situation where an ill-informed buyer, who wants to make some money, can get fooled into paying way over the odds for a car just because it's the only one painted in a particular colour, and thereby inflating the value for all. And no other owners are going to buck that trend by claiming their own car is over priced.
Your first point is one that particularly worries me as an enthusiast. Even at the comedically low end of the classic car market that I participate in, I have had people criticise me for using my 1983 Range Rover for off roading, asking me in patronising tones whether I realise how much damage that I could do itI also think one of the major factors is that uneducated investors (who would just as happily buy coffee, or sculptures, or rare teaspoons) see speculative prices being asked, and pay them, thereby inflating the perceived value of the cars they buy. There remains the common-sense, informed buyer, who knows what (within bounds) something is worth, but that ceases to have much meaning when the seller can knock the car down to any Tom, Dick or Barry for stupid numbers.
There will always be the middle ground, for want of a better name, of perfectly decent cars. Then there will also be those, as in the 1990's, who will pay vast amounts for a nut and bolt restoraton or more-or-less any car, and at the moment, they can still sell for a profit. A market will always find its level, and I think that will happen again, although this time, those upper-echelon cars will remain apart, and continue to be traded as trinkets.
It's true that the introducton of wealth from Russia, China and India has changed the picture, but fashions also change, and for those speculators for whom the article itself is irrelevant, something else shinier and more fashionable will come along eventually. Except that this 'new money' won't need to sell at a loss when the market moves, so a crash like we saw twenty-odd years ago is unlikely; more a softening of values over time.
I am particularly amused by a car for sale at the moment. Other examples go for betwen 12 and 23k. This one is up for 45 because there is a letter from the specialist owners' club saying it's worth 50. The seller is the founder of that club.
I cite this as an example of a situation where an ill-informed buyer, who wants to make some money, can get fooled into paying way over the odds for a car just because it's the only one painted in a particular colour, and thereby inflating the value for all. And no other owners are going to buck that trend by claiming their own car is over priced.
Edited by Doofus on Wednesday 3rd June 21:37
Edited by ClaphamGT3 on Sunday 21st February 11:11
cardigankid said:
Yeah well I own a classic, more than one imho, a Bentley T2 an old XK8 and a 996 C4S, and I'm telling you. However I own them because I want to own them not because I think they are going to make my fortune, quite the fking reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.
What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
You can't compare your own fleet which, although are all lovely cars, were made in large numbers to the rare Aston Martins and Ferrari's you mention. Two of them could only subjectively be described as classic cars. Even the last of the Newport pagnell built cars have exceeded your so-called £125,000 value.king reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
As a few others have mentioned, it appears to be those that do not own high-value classic cars that are simply talking down the market.
Looking at that graph it's all about timing if you're an investor. If you'd spent 100K in 1990, by 2000 ten years later your 100k car would only be worth 50k.
If you bought a 100k classic in 2000 it would be worth 400k today.
Looking at that graph I suspect a correction will come. But as many have said, it doesn't matter hugely to the enthusiast. Overall, classic cars are much more fun than numbers in a building society book.
If you bought a 100k classic in 2000 it would be worth 400k today.
Looking at that graph I suspect a correction will come. But as many have said, it doesn't matter hugely to the enthusiast. Overall, classic cars are much more fun than numbers in a building society book.
Looking at that graph it's all about timing if you're an investor. If you'd spent 100K in 1990, by 2000 ten years later your 100k car would only be worth 50k.
If you bought a 100k classic in 2000 it would be worth 400k today.
Looking at that graph I suspect a correction will come. But as many have said, it doesn't matter hugely to the enthusiast. Overall, classic cars are much more fun than numbers in a building society book.
If you bought a 100k classic in 2000 it would be worth 400k today.
Looking at that graph I suspect a correction will come. But as many have said, it doesn't matter hugely to the enthusiast. Overall, classic cars are much more fun than numbers in a building society book.
Cerberaherts said:
cardigankid said:
Yeah well I own a classic, more than one imho, a Bentley T2 an old XK8 and a 996 C4S, and I'm telling you. However I own them because I want to own them not because I think they are going to make my fortune, quite the fking reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.
What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
You can't compare your own fleet which, although are all lovely cars, were made in large numbers to the rare Aston Martins and Ferrari's you mention. Two of them could only subjectively be described as classic cars. Even the last of the Newport pagnell built cars have exceeded your so-called £125,000 value.king reverse actually. I don't care what happens either and I quite like the rising prices because of the availability of parts.What I don't like is the assumption on the part of 'marque specialists' that everyone with a classic car is loaded.
To me it is obvious, that when interest rates rise investors will be looking for real returns, and holding Ferraris at $35m or even old Astons at £1m whose real value I would assess as more like £125k is not going to make sense. Who is going to buy them at the higher figures which justify these prices? I suspect that the fall will be gradual rather than a crash, always assuming that WW3 doesn't break out.
As a few others have mentioned, it appears to be those that do not own high-value classic cars that are simply talking down the market.
I agree that of my cars only the Bentley is technically a classic (20 years +), but my motivation is enthusiasm, not investment. I am old enough to remember when you could even buy a DB3S for £7,500 from the pages of Motorsport, and the prime motivation of buyers was a. to own something beautiful and b. to have fun with it. Those motivated by those desires today, the enthusiast's market, would get better value looking at the kind of cars that I mentioned.
In the old days you could buy an exotic 'classic' for less that an ordinary contemporary saloon. Now you can't. In fact you can buy something that is better in every perceivable respect for a fraction of the cost of the famous classics. Would you rather have a well looked after six year old DB9 for £50k, or a dodgy DB5 for £500k? You are going to have an immeasurably better experience in the DB9. That is a fundamental inversion of the market from where it was. By the way I said I don't enjoy reading Octane. That's not true - I think it is a brilliant magazine, I just think that the ads are farcical.
I wonder why people speculate about when the crash is going to come in the price of classic cars but not in say the value of Picassos.
The dictionary on my PC defines Picasso as "Prolific and influential Spanish artist who lived in France (1881-1973*)"
Wikipedia's page says
"Picasso was exceptionally prolific throughout his long lifetime. The total number of artworks he produced has been estimated at 50,000, comprising 1,885 paintings; 1,228 sculptures; 2,880 ceramics, roughly 12,000 drawings, many thousands of prints, and numerous tapestries and rugs."
So he painted about as many pictures than Aston Martin made DB6's.
What should be worth more?
What would you rather own?
What looks better?
You can gaze adoringly at a DB6 and enjoys its visual beauty, to me far more than I could the majority of the works of Picasso. But what the painting could never give you is the fun of driving it.
I'm happy to believe that there are now, sadly, many people buying classic cars who are buying them as investments rather than for the simple joy in owning them, but I'm sure the same is true of Picassos. But there doesn't seem to be a shortage of people with money to invest. I've no idea how many people are buying them by borrowing the money, when I've spoken to dealers the feeling I get is more they are bought by people who have the money already. Are we likely to see a return to 10% interest rates on savings? I'd be very surprised, personally I think were more likely to see negative interest rates than any form of meaningful income from sticking money in a bank. I think most people have lost faith in "the city" and just see fear that investing there they'd just be seen as canon fonder. The government are hell bent on stamping out small scale investors in the property market (but note not large scale ones).
So why expect people to start panic selling at a loss, which is when bubbles burst.
(*) 1973, so by the 40 year rule he only just qualifies for "classic" status, for tax reasons.
The dictionary on my PC defines Picasso as "Prolific and influential Spanish artist who lived in France (1881-1973*)"
Wikipedia's page says
"Picasso was exceptionally prolific throughout his long lifetime. The total number of artworks he produced has been estimated at 50,000, comprising 1,885 paintings; 1,228 sculptures; 2,880 ceramics, roughly 12,000 drawings, many thousands of prints, and numerous tapestries and rugs."
So he painted about as many pictures than Aston Martin made DB6's.
What should be worth more?
What would you rather own?
What looks better?
You can gaze adoringly at a DB6 and enjoys its visual beauty, to me far more than I could the majority of the works of Picasso. But what the painting could never give you is the fun of driving it.
I'm happy to believe that there are now, sadly, many people buying classic cars who are buying them as investments rather than for the simple joy in owning them, but I'm sure the same is true of Picassos. But there doesn't seem to be a shortage of people with money to invest. I've no idea how many people are buying them by borrowing the money, when I've spoken to dealers the feeling I get is more they are bought by people who have the money already. Are we likely to see a return to 10% interest rates on savings? I'd be very surprised, personally I think were more likely to see negative interest rates than any form of meaningful income from sticking money in a bank. I think most people have lost faith in "the city" and just see fear that investing there they'd just be seen as canon fonder. The government are hell bent on stamping out small scale investors in the property market (but note not large scale ones).
So why expect people to start panic selling at a loss, which is when bubbles burst.
(*) 1973, so by the 40 year rule he only just qualifies for "classic" status, for tax reasons.
cardigankid said:
I agree to the extent that I would rather have a DB4GT Zagato at £3m than a Mondriaan, and good luck to the high rollers. Incidentally I am sure that there is just as much fraud in the art market as there is in old cars. There undoubtedly is an 'investor' market these days, totally separate from the enthusiasts market. Long may it continue, to a greater or lesser extent it undoubtedly will, but some of the prices (asked in the magazines it has to be said)for even quite common or garden stuff are objectively ludicrous. Any measure of common sense tells you that at the very least values cannot keep increasing at the rate they have and if that is so it removes some of the investment attraction. I have zero wish to talk down the market, but I am not going to say black is white to be politically correct.
I agree that of my cars only the Bentley is technically a classic (20 years +), but my motivation is enthusiasm, not investment. I am old enough to remember when you could even buy a DB3S for £7,500 from the pages of Motorsport, and the prime motivation of buyers was a. to own something beautiful and b. to have fun with it. Those motivated by those desires today, the enthusiast's market, would get better value looking at the kind of cars that I mentioned.
In the old days you could buy an exotic 'classic' for less that an ordinary contemporary saloon. Now you can't. In fact you can buy something that is better in every perceivable respect for a fraction of the cost of the famous classics. Would you rather have a well looked after six year old DB9 for £50k, or a dodgy DB5 for £500k? You are going to have an immeasurably better experience in the DB9. That is a fundamental inversion of the market from where it was. By the way I said I don't enjoy reading Octane. That's not true - I think it is a brilliant magazine, I just think that the ads are farcical.
Good post. However your DB9/DB5 analogy doesn't work. They made more DB9's and vantages than all the other cars since the start if production added together. A DB9 would never be worth what an early vanquish would be worth based on sheer production numbers, amongst other things. A DB5, even be requiring a total rebuild would always be a more appetising proposition financially. I currently have 2 DB5's under restoration, as well as a six and host if other classics. All but one of them are being restored for financial gain. So far this year we have had more enquiries regarding restoration works and more car sales than the last two months of last. Many in the trade are reporting the same. It's not slowing I the slightest....I agree that of my cars only the Bentley is technically a classic (20 years +), but my motivation is enthusiasm, not investment. I am old enough to remember when you could even buy a DB3S for £7,500 from the pages of Motorsport, and the prime motivation of buyers was a. to own something beautiful and b. to have fun with it. Those motivated by those desires today, the enthusiast's market, would get better value looking at the kind of cars that I mentioned.
In the old days you could buy an exotic 'classic' for less that an ordinary contemporary saloon. Now you can't. In fact you can buy something that is better in every perceivable respect for a fraction of the cost of the famous classics. Would you rather have a well looked after six year old DB9 for £50k, or a dodgy DB5 for £500k? You are going to have an immeasurably better experience in the DB9. That is a fundamental inversion of the market from where it was. By the way I said I don't enjoy reading Octane. That's not true - I think it is a brilliant magazine, I just think that the ads are farcical.
cardigankid said:
In the old days you could buy an exotic 'classic' for less that an ordinary contemporary saloon. Now you can't. In fact you can buy something that is better in every perceivable respect for a fraction of the cost of the famous classics. Would you rather have a well looked after six year old DB9 for £50k, or a dodgy DB5 for £500k? You are going to have an immeasurably better experience in the DB9. That is a fundamental inversion of the market from where it was. By the way I said I don't enjoy reading Octane. That's not true - I think it is a brilliant magazine, I just think that the ads are farcical.
Price aside, I'd take the DB5 any day. A DB9 'better' in every respect? If you think that then classic cars aren't for you. Of course a newer car is 'better' in measurable terms but that isn't why people desire classics.Cerberaherts said:
cardigankid said:
I agree to the extent that I would rather have a DB4GT Zagato at £3m than a Mondriaan, and good luck to the high rollers. Incidentally I am sure that there is just as much fraud in the art market as there is in old cars. There undoubtedly is an 'investor' market these days, totally separate from the enthusiasts market. Long may it continue, to a greater or lesser extent it undoubtedly will, but some of the prices (asked in the magazines it has to be said)for even quite common or garden stuff are objectively ludicrous. Any measure of common sense tells you that at the very least values cannot keep increasing at the rate they have and if that is so it removes some of the investment attraction. I have zero wish to talk down the market, but I am not going to say black is white to be politically correct.
I agree that of my cars only the Bentley is technically a classic (20 years +), but my motivation is enthusiasm, not investment. I am old enough to remember when you could even buy a DB3S for £7,500 from the pages of Motorsport, and the prime motivation of buyers was a. to own something beautiful and b. to have fun with it. Those motivated by those desires today, the enthusiast's market, would get better value looking at the kind of cars that I mentioned.
In the old days you could buy an exotic 'classic' for less that an ordinary contemporary saloon. Now you can't. In fact you can buy something that is better in every perceivable respect for a fraction of the cost of the famous classics. Would you rather have a well looked after six year old DB9 for £50k, or a dodgy DB5 for £500k? You are going to have an immeasurably better experience in the DB9. That is a fundamental inversion of the market from where it was. By the way I said I don't enjoy reading Octane. That's not true - I think it is a brilliant magazine, I just think that the ads are farcical.
Good post. However your DB9/DB5 analogy doesn't work. They made more DB9's and vantages than all the other cars since the start if production added together. A DB9 would never be worth what an early vanquish would be worth based on sheer production numbers, amongst other things. A DB5, even be requiring a total rebuild would always be a more appetising proposition financially. I currently have 2 DB5's under restoration, as well as a six and host if other classics. All but one of them are being restored for financial gain. So far this year we have had more enquiries regarding restoration works and more car sales than the last two months of last. Many in the trade are reporting the same. It's not slowing I the slightest....I agree that of my cars only the Bentley is technically a classic (20 years +), but my motivation is enthusiasm, not investment. I am old enough to remember when you could even buy a DB3S for £7,500 from the pages of Motorsport, and the prime motivation of buyers was a. to own something beautiful and b. to have fun with it. Those motivated by those desires today, the enthusiast's market, would get better value looking at the kind of cars that I mentioned.
In the old days you could buy an exotic 'classic' for less that an ordinary contemporary saloon. Now you can't. In fact you can buy something that is better in every perceivable respect for a fraction of the cost of the famous classics. Would you rather have a well looked after six year old DB9 for £50k, or a dodgy DB5 for £500k? You are going to have an immeasurably better experience in the DB9. That is a fundamental inversion of the market from where it was. By the way I said I don't enjoy reading Octane. That's not true - I think it is a brilliant magazine, I just think that the ads are farcical.
And yes I'd rather own the 500k bodged DB5 than any DB9
They may well be some kind of correction but the rare low mileage good history cars will not faulter. It's a world wide market and these cars will always remain in a sellers market
I have always believed that these cars which currently command huge prices were works of art of far higher quality than many fashionable paintings worth similar amounts. I applaud the high prices asked and paid, particularly because they allow so many of these cars to be restored in a way which would have been inconceivable twenty years ago. I do not think that the market will crash though I would not be surprised to see some 'correction' if interest rates start to rise.
However, their current values place these cars so far beyond the reach of 99% of enthusiasts that like the Bugatti Veyron, McLaren P1 and Porsche 918, and maybe this is personal rather than general, they cease to hold much interest. The purely enthusiast market has to move elsewhere, to cars it can afford. The irony is that the cars it can afford are actually superior in most respects to those it can't. I don't doubt everyone on here would rather have a DB5 than a DB9, not least because of the value of the 5, but surely one has to accept that the 9 is the better drive. Another factor which makes me a little sceptical of the stratospheric prices asked for some cars is what you can now buy new for much less. I mean, why pay P&A Wood £230k for a mint Bentley S3 when you could buy a new Mulsanne Speed? Or pay A N Other £500k for a Ferrari 246 Dino when you could buy a well specked McLaren 570S for £170k Max? The appeal of the classics was borne in the 1970's when they offered value for money as well as style and performance. This has now changed fundamentally.
Careful consideration is also due when something becomes worth so much more than the intrinsic value of its components, and cannot of itself generate income. I can't help feeling that what is being sold is not an artefact but a dream. In the case of the car it is a ticket into the 60's world of Cary Grant and Grace Kelly, or Sean Connery and Ian Fleming. To what extent is the dream predicated on the genuineness of the artefact? The same thing applies to a Chippendale cabinet, a Faberge Egg or a painting by Veronese. When a large part of it has been replaced in the restoration process when does it cease to be something old and actually be something new? What if the manufacturer decides to build new ones, as AM did with the Sanction 2 Zagatos, and Jaguar did with the 'new' lightweight E Types. What Iif one day Aston decide to start building DB5's again, since the appetite for them is so insatiable? Why shouldn't they?
However, their current values place these cars so far beyond the reach of 99% of enthusiasts that like the Bugatti Veyron, McLaren P1 and Porsche 918, and maybe this is personal rather than general, they cease to hold much interest. The purely enthusiast market has to move elsewhere, to cars it can afford. The irony is that the cars it can afford are actually superior in most respects to those it can't. I don't doubt everyone on here would rather have a DB5 than a DB9, not least because of the value of the 5, but surely one has to accept that the 9 is the better drive. Another factor which makes me a little sceptical of the stratospheric prices asked for some cars is what you can now buy new for much less. I mean, why pay P&A Wood £230k for a mint Bentley S3 when you could buy a new Mulsanne Speed? Or pay A N Other £500k for a Ferrari 246 Dino when you could buy a well specked McLaren 570S for £170k Max? The appeal of the classics was borne in the 1970's when they offered value for money as well as style and performance. This has now changed fundamentally.
Careful consideration is also due when something becomes worth so much more than the intrinsic value of its components, and cannot of itself generate income. I can't help feeling that what is being sold is not an artefact but a dream. In the case of the car it is a ticket into the 60's world of Cary Grant and Grace Kelly, or Sean Connery and Ian Fleming. To what extent is the dream predicated on the genuineness of the artefact? The same thing applies to a Chippendale cabinet, a Faberge Egg or a painting by Veronese. When a large part of it has been replaced in the restoration process when does it cease to be something old and actually be something new? What if the manufacturer decides to build new ones, as AM did with the Sanction 2 Zagatos, and Jaguar did with the 'new' lightweight E Types. What Iif one day Aston decide to start building DB5's again, since the appetite for them is so insatiable? Why shouldn't they?
Edited by cardigankid on Sunday 21st February 23:38
Cardigankid, you are of course correct in that there are better ways of getting your 'interesting car' fix. There are faster, better looking, quieter, more economic cars, but that misses the point of owning interesting cars.
Your argument however is as effective of trying to convince a golfer that their walk would be much easier if they didn't have to carry that bag of sticks around, or trying to convince somebody who's fly fishing stood in freezing water upto their waist that Trout is cheaper at Tesco.
All for the love of cars....
Your argument however is as effective of trying to convince a golfer that their walk would be much easier if they didn't have to carry that bag of sticks around, or trying to convince somebody who's fly fishing stood in freezing water upto their waist that Trout is cheaper at Tesco.
All for the love of cars....
Edited by The Surveyor on Monday 22 February 10:41
Well clearly since the thread was started in 2015, the bubble hasn't yet burst.
I have recently seen some of the most absurd asking prices I've ever seen.
The peak of the late 80's/early 90's boom was marked by a Ferrari 328 being sold for £197k. The buyer of that car would still not get his money back today. Of course it was a pretty new car then and the last boom was all about Ferrari in particular but very low mileage cars are being advertised currently for in excess of £170k. However when you see people having the audacity to ask for £2m for an Enzo, over £700k for a 550 Barchetta or £300k for a 360CS or perhaps most shocking of all £80k for a Mondial it's very clear that we are in the grip of some wild speculation.
Clearly there are plenty of wealthy people out there but how many of them are dumb enough to think this can possibly keep going? I can't blame the dealers for trying to make hay while the sun shines after years of difficult trading but I think such absurd, inflated prices will ultimately cause a crash when it could have been a soft landing.
There are signs of things slowing down. I've been looking at Integrales recently and Evo 2s don't seem to be moving very quickly at £45k. Naturally Joe Macari is taking a punt at £79k for a special edition model but that doesn't seem to be flying out of the showroom either. And there are so many inconsistencies out there. E46 M3CSLs are commanding huge prices while the regular M3s are unaffected, even for super low mileage cars with a manual gearbox - something you can't get in a CSL. Of the original Skyline GTRs only the R34 seems to have really done much. Some rare, desirable cars are being overlooked too. The Subaru 22B has gone from £25k to £50k in the last 3 years but it's still looking reasonable to me with only 400 made and countless crashed and written off. They made somewhere over 6000 Integrale Evo 2s. I also spotted a LHD manual Murcielago LP640 for sale at £120k - the same as the largely unloved Ferrari 360. That's not looking super inflated to me.
It's going to be a very interesting next 12 months!
I have recently seen some of the most absurd asking prices I've ever seen.
The peak of the late 80's/early 90's boom was marked by a Ferrari 328 being sold for £197k. The buyer of that car would still not get his money back today. Of course it was a pretty new car then and the last boom was all about Ferrari in particular but very low mileage cars are being advertised currently for in excess of £170k. However when you see people having the audacity to ask for £2m for an Enzo, over £700k for a 550 Barchetta or £300k for a 360CS or perhaps most shocking of all £80k for a Mondial it's very clear that we are in the grip of some wild speculation.
Clearly there are plenty of wealthy people out there but how many of them are dumb enough to think this can possibly keep going? I can't blame the dealers for trying to make hay while the sun shines after years of difficult trading but I think such absurd, inflated prices will ultimately cause a crash when it could have been a soft landing.
There are signs of things slowing down. I've been looking at Integrales recently and Evo 2s don't seem to be moving very quickly at £45k. Naturally Joe Macari is taking a punt at £79k for a special edition model but that doesn't seem to be flying out of the showroom either. And there are so many inconsistencies out there. E46 M3CSLs are commanding huge prices while the regular M3s are unaffected, even for super low mileage cars with a manual gearbox - something you can't get in a CSL. Of the original Skyline GTRs only the R34 seems to have really done much. Some rare, desirable cars are being overlooked too. The Subaru 22B has gone from £25k to £50k in the last 3 years but it's still looking reasonable to me with only 400 made and countless crashed and written off. They made somewhere over 6000 Integrale Evo 2s. I also spotted a LHD manual Murcielago LP640 for sale at £120k - the same as the largely unloved Ferrari 360. That's not looking super inflated to me.
It's going to be a very interesting next 12 months!
twinturban said:
Well clearly since the thread was started in 2015, the bubble hasn't yet burst.
I have recently seen some of the most absurd asking prices I've ever seen.
The peak of the late 80's/early 90's boom was marked by a Ferrari 328 being sold for £197k. The buyer of that car would still not get his money back today. Of course it was a pretty new car then and the last boom was all about Ferrari in particular but very low mileage cars are being advertised currently for in excess of £170k. However when you see people having the audacity to ask for £2m for an Enzo, over £700k for a 550 Barchetta or £300k for a 360CS or perhaps most shocking of all £80k for a Mondial it's very clear that we are in the grip of some wild speculation.
Clearly there are plenty of wealthy people out there but how many of them are dumb enough to think this can possibly keep going? I can't blame the dealers for trying to make hay while the sun shines after years of difficult trading but I think such absurd, inflated prices will ultimately cause a crash when it could have been a soft landing.
There are signs of things slowing down. I've been looking at Integrales recently and Evo 2s don't seem to be moving very quickly at £45k. Naturally Joe Macari is taking a punt at £79k for a special edition model but that doesn't seem to be flying out of the showroom either. And there are so many inconsistencies out there. E46 M3CSLs are commanding huge prices while the regular M3s are unaffected, even for super low mileage cars with a manual gearbox - something you can't get in a CSL. Of the original Skyline GTRs only the R34 seems to have really done much. Some rare, desirable cars are being overlooked too. The Subaru 22B has gone from £25k to £50k in the last 3 years but it's still looking reasonable to me with only 400 made and countless crashed and written off. They made somewhere over 6000 Integrale Evo 2s. I also spotted a LHD manual Murcielago LP640 for sale at £120k - the same as the largely unloved Ferrari 360. That's not looking super inflated to me.
It's going to be a very interesting next 12 months!
What your comment confirms is that there is still many years of the upward trend to continue especially if we still are no where near those prices from the last 'boom'. If a 328 actually sold for £197k back in the 90's (25 years ago), they would have to crack the £250k mark to get to the same point and that will be a good few years away. Unfortunately people with money can afford to be dumb, every single investment market on the planet relies on that, 'A fool and his money....' is not a new saying.I have recently seen some of the most absurd asking prices I've ever seen.
The peak of the late 80's/early 90's boom was marked by a Ferrari 328 being sold for £197k. The buyer of that car would still not get his money back today. Of course it was a pretty new car then and the last boom was all about Ferrari in particular but very low mileage cars are being advertised currently for in excess of £170k. However when you see people having the audacity to ask for £2m for an Enzo, over £700k for a 550 Barchetta or £300k for a 360CS or perhaps most shocking of all £80k for a Mondial it's very clear that we are in the grip of some wild speculation.
Clearly there are plenty of wealthy people out there but how many of them are dumb enough to think this can possibly keep going? I can't blame the dealers for trying to make hay while the sun shines after years of difficult trading but I think such absurd, inflated prices will ultimately cause a crash when it could have been a soft landing.
There are signs of things slowing down. I've been looking at Integrales recently and Evo 2s don't seem to be moving very quickly at £45k. Naturally Joe Macari is taking a punt at £79k for a special edition model but that doesn't seem to be flying out of the showroom either. And there are so many inconsistencies out there. E46 M3CSLs are commanding huge prices while the regular M3s are unaffected, even for super low mileage cars with a manual gearbox - something you can't get in a CSL. Of the original Skyline GTRs only the R34 seems to have really done much. Some rare, desirable cars are being overlooked too. The Subaru 22B has gone from £25k to £50k in the last 3 years but it's still looking reasonable to me with only 400 made and countless crashed and written off. They made somewhere over 6000 Integrale Evo 2s. I also spotted a LHD manual Murcielago LP640 for sale at £120k - the same as the largely unloved Ferrari 360. That's not looking super inflated to me.
It's going to be a very interesting next 12 months!
Of the other cars mentioned, the M3's and Lancia's are all 10 years too new to be of interest to the investors. IMHO, they still fall into the 'old & interesting' category rather than the 'investment' market.
Oh and if I was awash with cash, I'd pay £2m for an Enzo.....
Surely someone would only ever pay £2m for an Enzo in the belief that it will be worth £2.5m one day? Does the driving experience even matter at this level? I see it as a not particularly desirable car (to me) that is likely to drop beneath £1m, so even with a Euromillions windfall I'd avoid that.
Wierdly though, the high price is actually part of the appeal. Many supercars are bought as wealth statements so I guess you cause more of a stir showing up in your £2m Enzo than you did when it was 'only' worth £800k. I reluctantly have to admit that I find Integrales more 'special' now at £40k than I did at £15k. When prices are very low it suggests that nobody wants them and they might be hard to sell on. NSXs are the same, they have the aura of something more desirable and admired since they have increased in value. So I guess an amplified version of that applies to the top end of the market.
We had a DB6 in the extended family for many years, it was worth £28k tops for most of that time. For years all anyone could see were the differences between it and the DB5. Now all everyone can see are the similarities!
Wierdly though, the high price is actually part of the appeal. Many supercars are bought as wealth statements so I guess you cause more of a stir showing up in your £2m Enzo than you did when it was 'only' worth £800k. I reluctantly have to admit that I find Integrales more 'special' now at £40k than I did at £15k. When prices are very low it suggests that nobody wants them and they might be hard to sell on. NSXs are the same, they have the aura of something more desirable and admired since they have increased in value. So I guess an amplified version of that applies to the top end of the market.
We had a DB6 in the extended family for many years, it was worth £28k tops for most of that time. For years all anyone could see were the differences between it and the DB5. Now all everyone can see are the similarities!
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