Is the bubble about to burst?
Discussion
Alpinestars said:
Sold mine for the same price about 2 years ago. I was the daft one then, as it sold for about 20k more 3 months later.
Never easy to spot the top or bottom of a market like this.My self-imposed rule of neither borrowing money or liquidating investments to fund 'fun' cars precludes me from dabbling in pretty much anything with a GT3 in it right now.
The number of people available for buying cars at 100k + is pretty finite and an increase in prosperity has not increased this number enough to explain the certain strong demand at this price point or above. The only thing that has changed is the availability of cheap credit and the absence of opportunity costs for holding these cars. So as soon as the cost of money goes up we will see this inflated market to crash down again.
Alpinestars said:
Sold mine for the same price about 2 years ago. I was the daft one then, as it sold for about 20k more 3 months later.
I saw your old car in OPC Leeds a couple of weeks back. Up for 155 grand. Still with 512 miles on the clock. The 4 previous owners seems to be putting people off it I guess. It's been passed round various dealers for over a year with no one biting. Top spec and colour.
Legacywr said:
Just out of interest.. who on here has thier car on credit?
Apropos of this, I do a fair bit of mountain biking. Decent, full-suspension mountain bikes are not cheap; start at £3k and could even be as much as three times that. By my judgement, the bulk of 'serious' machinery is in the £4 to £5k bracket. (You'll sometimes see two of these on a 2 grand or less car, which is amusing.) More than a few riders are buying these on credit now. Some of the guys I ride with - socially it is a real mix in terms of professions and means - do this.If people get enough enjoyment out of their toys -cars, bikes or whatever - in the here and now, I can absolutely see the justification in the added risk and cost of financing.
hornbaek said:
The number of people available for buying cars at 100k + is pretty finite and an increase in prosperity has not increased this number enough to explain the certain strong demand at this price point or above. The only thing that has changed is the availability of cheap credit and the absence of opportunity costs for holding these cars. So as soon as the cost of money goes up we will see this inflated market to crash down again.
I am not convinced a car enthusiast with a modest income have the means to purchase arbitrary 100k+ second-hand cars in that way. Perhaps only those who have used their longer term savings or from released capital to satisfy their moment of impulsiveness. There is a definite interest for 911's from the 90's and 00's, perhaps buyers who once couldn't afford these cars back in the day now can along side modern cars, and they want to scratch that itch.
At the meantime, you have the dealer network who work on a sale-or-return to protect sellers/buyers from the risks of a 6 digit transaction. They collectively now control the supply of used 911's, keeping the prices of these "future appreciating classics" as high as possible.
hornbaek said:
The only thing that has changed is the availability of cheap credit and the absence of opportunity costs for holding these cars. So as soon as the cost of money goes up we will see this inflated market to crash down again.
When you say cheap credit, how cheap are you talking about, Oracle are still at 7.95% APR and the cheapest car finance i could find was 5.8%APR with a max amount of £50k.If you can find much cheaper rates i'm all ears as there is a black on black 991 GTS at Tewkesbury OPC that i would really like.
http://www.pistonheads.com/classifieds/used-cars/p...
For some, mortgage equity release is a useful tool for all or part of a purchase. If you have a large, offset or open-plan type mortgage that's nearly paid off, and you have negotiated a decent rate on it, it's a relatively cheap way to borrow.
We've done this in the past with Mrs Digga's cars, because it worked out cheaper -lower rate of interest - than buying on conventional finance.
We've done this in the past with Mrs Digga's cars, because it worked out cheaper -lower rate of interest - than buying on conventional finance.
Japan is actually quite an interesting example, comparing to U.K. I do visit quite often due to my work since 2008. Japanese, mainly middle class quite enjoyed their car/motor indulgences back in to 80s but many of them have been cutting back since. Of course there is still a big population of several individuals still collecting and enjoying their cars but not that many as used to be. Funny coincidence, a friend of mine imported a crisp 12k miles Ferrari 355 from Tokyo a few years ago.
anonymous said:
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I have a theory. The 991 GT3 was the first really 'hyped' Porsche. Do you remember the frenzy on here? Social media and the interweb as a whole has changed everything and Porsche rode the wave very well. I believe that it was the first time that they really used this tactic to the full.What we are seeing now is the lasting remnants of that policy.
Yes I think the 'interweb' and all the Schmee type stuff has in part created a frenzy.
Interesting that the OPC listed 991 GT3s have crept up in price partly fuelled by sale or return cars.....but the trade prices have dropped quite markedly similar to the % drop on the RS and will take a further hit into the autumn or and winter with the usual seasonal sports car downturn. As warranties approach expiry the spread between trade and hopeful retail will widen.....good spec and mileage non clubsport cars are now trading under list and there is a fair amount of nervousness around atm.
Interesting that the OPC listed 991 GT3s have crept up in price partly fuelled by sale or return cars.....but the trade prices have dropped quite markedly similar to the % drop on the RS and will take a further hit into the autumn or and winter with the usual seasonal sports car downturn. As warranties approach expiry the spread between trade and hopeful retail will widen.....good spec and mileage non clubsport cars are now trading under list and there is a fair amount of nervousness around atm.
I was reading a 2 yr old 911 Porsche mag the other day and many cars have doubled in 2 years. Where has all this cash come from - ultra cheap interest rates, much from remortgaging. As the economy inevitably slows next year, people's appetite to find this cash has got to subside. I'm talking 35-75k here as opposed to top end.
The problem with a bubble is no one sees it until it's too late, at which point a few dealers go under almost overnight, buyers thinks"I'll wait a bit and they'll come lower" and the inevitable correction happens when for a period there is NO buyers. I saw this in Spanish property not so long ago...
NoOne knows when it's gonna happen, like everything in life, it's all about timing. Buy a 996 turbo 2 years ago at £28k- perfect timing. But one at £55k end 2016??? Who knows. Could be £75k in 2018, just as easily could be £40k or less. Think about it - 40 thousand quid - that's a shed load of money for an oldish car...
Al I know is buy if you can afford it and enjoy it, but don't over leverage at this point in the appreciation curve...
The problem with a bubble is no one sees it until it's too late, at which point a few dealers go under almost overnight, buyers thinks"I'll wait a bit and they'll come lower" and the inevitable correction happens when for a period there is NO buyers. I saw this in Spanish property not so long ago...
NoOne knows when it's gonna happen, like everything in life, it's all about timing. Buy a 996 turbo 2 years ago at £28k- perfect timing. But one at £55k end 2016??? Who knows. Could be £75k in 2018, just as easily could be £40k or less. Think about it - 40 thousand quid - that's a shed load of money for an oldish car...
Al I know is buy if you can afford it and enjoy it, but don't over leverage at this point in the appreciation curve...
Tripe Bypass said:
I saw your old car in OPC Leeds a couple of weeks back. Up for 155 grand. Still with 512 miles on the clock. The 4 previous owners seems to be putting people off it I guess. It's been passed round various dealers for over a year with no one biting. Top spec and colour.
Unbelievable. Nothing wrong with the car, other than flappy paddles and e steering. The original buyer never drove it. I did about 250 miles in it and got bored. Next owner probably a couple of hundred.
And buying expensive cars on credit is a bit nuts I think, but maybe with interest rates as they are, some people won't agree with me.
Edited by Alpinestars on Friday 26th August 22:02
missing the point of technology change impacting further cars like hybridisation/turbocharging/electric power steering etc.
cars are going to be drastically different due to emissions very soon therefore due to technology impact, the current crop of cars may become the last of an era hence collector value form the off.
Cheap money helps but also the potential for upside from a drastically different future may also help given that even GT cars already feel less raw than their predecessors.
cars are going to be drastically different due to emissions very soon therefore due to technology impact, the current crop of cars may become the last of an era hence collector value form the off.
Cheap money helps but also the potential for upside from a drastically different future may also help given that even GT cars already feel less raw than their predecessors.
anonymous said:
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Why is he 'off his rocker' he makes a very good point. Why is it that if anyone disagrees with any of your tens of thousands of posts or you disagree with them, they are either mad or don't know what they are talking about? Even if you truly believe you are right about everything, I suggest you temper your constant use of derogatory adjectives, it makes you sound like a pub know it all that people like to avoid.
I very much look forward to your scathing defensive response, using the multi-quote feature to assist you in your important task.
anonymous said:
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ive heard you say this before. Clarkson sort of raised this in a review of what he (mistakenly) thought was the last V12 Aston.I considered this opinion the other week as, from the vantage point of my first floor office, I watched a 100+ year old steam roller trundling down the by pass blocking traffic, bel chin smoke. Banning historic vehicles would be a drastic and largely useless (leisure vehicle use creates minimal overall pollution) means to environmental ends and would trash a huge part of our industrial heritage and tradition. It is very unlikely to happen, even if all our daily drives might be lentil powered.
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