RE: Price hike: PH Blog
Discussion
It must to get the stage where you enjoy driving it less due to the "investment" which is ironic really.
Best to get a car, thrash it, tune it up, have it blow itself to pieces then swear never again. Until next time.
That's what cars are for. Nobody has fond memories of a car sitting in a garage to be taken out once in a blue moon to be gently driven about... worrying about stone chips.
Best to get a car, thrash it, tune it up, have it blow itself to pieces then swear never again. Until next time.
That's what cars are for. Nobody has fond memories of a car sitting in a garage to be taken out once in a blue moon to be gently driven about... worrying about stone chips.
dlockhart said:
Vee12V said:
Many old Porsches are clearly over valued in my opinion, others like early Elise s1's aren't.
Still baffles me.
I think its about perception, the 993 was seen as the last of a breed and therefore the best of a classic.Still baffles me.
The s1 is seen as start of a journey which still on going, possibly with each iteration being better than the one before, this may not be 100% true in reality but its about perception.
Wish I had the necessary for some of these beasts!
Ive been monitoring the crazy prices paid recently and slowly watched my dream cars get further and further out of reach. In my opinion two things have turned what was once an enthusiasts market into a speculative one.
EBay and Interest rates.
The classic market didnt crash in 2007-8 like it did in the 90's, the difference is interest rates, where else can people put their money and enjoy the benefits of having some at the same time? the banks are a waste of time and houses are even more! Ebay and online advertisisng has opened the market to everyone. We all used to buy magazines when we wanted a new car. whereas 10 people were once half interested in buying a particular car now there's 100, bidding is cheap and risk free judging by the number of people that then back out of a transaction, all everyone else then sees is the crazy price paid , not the fact it fell through and they then advertise their car accordingly.
just my two penneth !
EBay and Interest rates.
The classic market didnt crash in 2007-8 like it did in the 90's, the difference is interest rates, where else can people put their money and enjoy the benefits of having some at the same time? the banks are a waste of time and houses are even more! Ebay and online advertisisng has opened the market to everyone. We all used to buy magazines when we wanted a new car. whereas 10 people were once half interested in buying a particular car now there's 100, bidding is cheap and risk free judging by the number of people that then back out of a transaction, all everyone else then sees is the crazy price paid , not the fact it fell through and they then advertise their car accordingly.
just my two penneth !
There's a lot of talk at the moment about cars being used as Investment (i.e. Financial growth) rather than driving pleasure, this is driving some of the prices for rarer older vehicles (i.e. those where limited numbers are built and they are seen as iconic - e.g. Countach for instance - where a LP400 has just sold for $1.21m).
Whilst CS prices have rose steadily over probably the last 2 years, so have the Countach prices, and now the Diablo prices (at least in SV and SE guise) seem to be doing the same. Pre-Countach Lamborghini's seem to be also heading the same way (Miura excepted - those shot up in the early 2000's).
The danger with this, is the correction that occurs in financial markets and the purchases who get burnt when that correction happens.
I buy mine to drive, and don't mind the miles clocking up on it.
I buy company shares and houses for investment.
Whilst CS prices have rose steadily over probably the last 2 years, so have the Countach prices, and now the Diablo prices (at least in SV and SE guise) seem to be doing the same. Pre-Countach Lamborghini's seem to be also heading the same way (Miura excepted - those shot up in the early 2000's).
The danger with this, is the correction that occurs in financial markets and the purchases who get burnt when that correction happens.
I buy mine to drive, and don't mind the miles clocking up on it.
I buy company shares and houses for investment.
The market is frothy, for sure. This can be explained in part because cars, like other so called "collectibles", have benefited from the atypical investment environment in recent years. The combination of very low interest rates and a prolonged recession have meant that investors seeking yield have ventured outside of the traditioanl investment markets (stocks, bonds) and dabbled in other assets. This has particularly been the case for wealthy private individuals who, faced with the choice between a low return on equities or bonds or the fun of owning something like a classic Ferrari, have decided to get some fun along with their potential economic upside.
The concern for others thinking of making the plunge is twofold. First, as the financial markets return to a more "normal" paradigm, the interest in collectibles will wane. That will lead to a migration of cash from the car market into other investments. Second, as with any bubble, as prices of the genuinely collectible assets rise, and climb beyond the reach of mere mortals, there is a ripple effect that drags up the prices of more ordinary stuff (in the way Chris describes). When the prices start to fall, it is likely to be those who "invested" in the second tier who feel a lot of pain having overpaid for "ordinary" metal.
For what it's worth, my view on buying cars for long term value is that you should look for (at a minimum) these three things:
1. a premium badge - there are plenty of views on what this actually means, but a racing peigree/history is a good starting point
2. the car was expensive, or expensive relative to its direct competition, when it was new
3. there are not many about.
On that basis, I purchased a 1964 Alfa Sprint Speciale and a 1961 Maserati 3500GT. Will I make money on them? Hopefully - but ultimately they were bought because I think they are things of beauty, I intend to carry on driving them, and they give me a lot of pleasure. And, given what I paid for them, it would be a big shock if over any period of time they cost me more than running my modern cars!
The concern for others thinking of making the plunge is twofold. First, as the financial markets return to a more "normal" paradigm, the interest in collectibles will wane. That will lead to a migration of cash from the car market into other investments. Second, as with any bubble, as prices of the genuinely collectible assets rise, and climb beyond the reach of mere mortals, there is a ripple effect that drags up the prices of more ordinary stuff (in the way Chris describes). When the prices start to fall, it is likely to be those who "invested" in the second tier who feel a lot of pain having overpaid for "ordinary" metal.
For what it's worth, my view on buying cars for long term value is that you should look for (at a minimum) these three things:
1. a premium badge - there are plenty of views on what this actually means, but a racing peigree/history is a good starting point
2. the car was expensive, or expensive relative to its direct competition, when it was new
3. there are not many about.
On that basis, I purchased a 1964 Alfa Sprint Speciale and a 1961 Maserati 3500GT. Will I make money on them? Hopefully - but ultimately they were bought because I think they are things of beauty, I intend to carry on driving them, and they give me a lot of pleasure. And, given what I paid for them, it would be a big shock if over any period of time they cost me more than running my modern cars!
You think that's bad? A couple of months ago a work of art of a gullwing, sold for more than a f
king real one.
fk you Warhol.
Some prices are getting mad, by mad I mean I knew they would go up like crazy (gt3 rs) but I am too young to able to afford a 997.2 GT3 RS in that oh so sexy grey-black colour. Therefore I cannot both enjoy the flat six fruits and enjoy the price increase, nor can I enjoy the car when I do get some money because they will be out of my reach/I think they are 'not' worth it compared to xyz.
king real one.f
k you Warhol.Some prices are getting mad, by mad I mean I knew they would go up like crazy (gt3 rs) but I am too young to able to afford a 997.2 GT3 RS in that oh so sexy grey-black colour. Therefore I cannot both enjoy the flat six fruits and enjoy the price increase, nor can I enjoy the car when I do get some money because they will be out of my reach/I think they are 'not' worth it compared to xyz.
dlockhart said:
Vee12V said:
Many old Porsches are clearly over valued in my opinion, others like early Elise s1's aren't.
Still baffles me.
I think its about perception, the 993 was seen as the last of a breed and therefore the best of a classic.Still baffles me.
The s1 is seen as start of a journey which still on going, possibly with each iteration being better than the one before, this may not be 100% true in reality but its about perception.
Ferrari are indisputably the greatest brand in the world right now. Some might not like this, but its true. At the same time, they have remained true to their core values; motorsport 1st, come road cars second and they have remained utterly loyal to this. For example, do we see Ferrari SUVs and other platform sharing like we do with Porsche? No.
In addition, lets just leave aside their performance and mind-bogling engineering expertise, they have over the last 60 years produced some of the most beautiful, beautifully built cars that have had a greater vocal range than anything else, be it with their Colombo V12, or their more recent engines. The cars speak for themselves really -I don't recall seeing a Ferrari advert anywhere. They have a successful past, and look to have a successful future. Why not then, invest in this brand? £200k for a CS seems reasonable to me, 85k for an E30 M3? Not quite sure.
Similarly, the early 911 2.7 RS ad the more recent 997 GT3s should also attract investment. The price recently asked for a 964 RS on the hand makes me laugh.
You say the S1, well great little car that it undoubtedly is, look at where Lotus lies now. There are great Alfas of recent (by recent I mean 30-40 years) past and they are deemed to be classics, but their prices are going up only incrementally because the brand took a knock out punch in the 80s and early 90s from FIAT before clamoring back up to where it (just about) stands now.
So, you have to look at the lineage and the purity of the product, the success of the brand, not just with one of its products (i.e Porsche never ending cover of the 911) but also its creative range and how it excites all the senses as well as its rarity and motorsport heritage.
It sounds funny, but its true.
dlockhart said:
Vee12V said:
Many old Porsches are clearly over valued in my opinion, others like early Elise s1's aren't.
Still baffles me.
The s1 is seen as start of a journey which still on going, possibly with each iteration being better than the one before, this may not be 100% true in reality but its about perception.Still baffles me.
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