Is the bubble about to burst?

Is the bubble about to burst?

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Discussion

Crimp

Original Poster:

909 posts

186 months

Saturday 8th August 2015
quotequote all
g7jhp said:
highway said:
The point missed with all this bubble bursting talk is simple. Porsche aren't making any more air-cooled cars. Whilst not the last word in driving enjoyment they are pretty, sound nice and ooze character. They don't come with too many electronics and for what seems like an increasing amount of people, they are more desirable than the current range. Unless draconian rules are brought in regarding emissions and/or driving non green cars in town, then scant see a bubble bursting anytime soon.

Its not just limited to Porsche either. Every other vaguely interesting marque has seen a resurgence of interest in its back catalogue.
Porsche haven't been making any more SC's for 33 years, 3.2's for 26 years, 964's for 22 years, 993's for 18 years. Why have people decided these are all suddenly worth something since circa 2014?

Because people have excess cash, other investments haven't been generating a return and the classic car market has shown as good a return as anything else.

The car pool is like the property pool. If you can't afford Chiswick you bought in Brentword or Ealing. If you couldn't get a manual 964 coupe, people are getting what they perceive as the next best be it a manual 964 targa or tip 964 coupe. They're not driving them, it's an investment.

Most people who drive an SC, 3.2 or 964 will feel it's heavy, agricultural and dated compared to modern cars. Even enthusiasts will admit they don't want to drive aircooled cars on a daily basis.

As a whole petrolheads are a shrinking breed, the kids of today rent cars they don't buy them. PH's, 911 UK, W90/L90 bring together a limited group of petrolheads with the money to buy these cars and people talk up the demand. Some do need to sell one car to buy another. A growing number of enthusiasts buying multiple 911's and swapping between models so always to be in a car.

I'd be happy for the bubble to pop as more cars would come onto the market, there would be a greater choice and we'd all have to pay less to move between cars. To me it's about driving great cars and sharing the the experience with fellow petrolheads.
I'd like another SC as IMO it was the best air-cooled car I owned but looking at the adds 25k+ for a bloody Targa and 35k for a coupe its a no no. Its not that I can't afford it, I just know the cars are not worth it.
With that in mind I have decided to wait until they drop before buying another. Looking at how slow they are moving now at the dealers and privately its only a matter of time before prices are corrected.

Black_mamba

313 posts

208 months

Saturday 8th August 2015
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...can I just ask the 'poppers', what the perceived value should be for the run of the mill AC cars? a 3.2 coupe, targa, convertible, same for 993 etc. I know its hard but I'm at a bit of a loss, I thought the price was determined my what buyers and sellers are willing to deal at, not what internet jocks think that prices should be. I can't wait till my neighbours house is what he paid for it 15 years ago, then I'll buy it...

SEE YA

3,522 posts

244 months

Saturday 8th August 2015
quotequote all
Bought my old 911 did not think about value going up or down.

Buy a car to enjoy.

Edited by SEE YA on Saturday 8th August 19:23

mollytherocker

14,365 posts

208 months

Saturday 8th August 2015
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YoungMD said:
There is some truth in what you say, but where we are now is not sensible, i mean SC's selling for north of £30k, 3.2 £40k+, a decent 3.2 should be £25k. Your assumption would be correct if there is really a big rise in people that want old 911's that will remain, and i don't think thats the case, some people, me included love 911's especially air cooled, but there are many people that don't have our rose tinted glasses and hate the heating, oil smell, racket of trash cans being knocked over when you start the engine etc etc etc .... these fly by night investors and trend followers will go and with them the speculation and inflated values
A decent 3.2 should be 25k?

Why? A decent 3.2 is circa 40k, thats a fact. I would like them to be 10k again, but that makes no difference to the truth!

I think that talk of a bubble is over simplifying the whole Porsche market. There is much going on, much of it mentioned here.

Its possible that there could be a correction at the very top of the market, but I reckon lower to middle end of the air cooled market is at the correct level, having had a correction over the past 3 years, yes, there are some daft prices on some individual cars, but thats always been the case. Air cooleds have nearly doubled and I see that holding for some time yet, and then a further increase.

Only my view of course, anything could happen.

996TT02

3,308 posts

139 months

Saturday 8th August 2015
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Crimp said:
I'd like another SC as IMO it was the best air-cooled car I owned but looking at the adds 25k+ for a bloody Targa and 35k for a coupe its a no no. Its not that I can't afford it, I just know the cars are not worth it.
Precisely.

Not that long ago I did not buy a 993 coupe at 25k for the same reasons.



996TT02

3,308 posts

139 months

Saturday 8th August 2015
quotequote all
Black_mamba said:
...can I just ask the 'poppers', what the perceived value should be for the run of the mill AC cars? a 3.2 coupe, targa, convertible, same for 993 etc. I know its hard but I'm at a bit of a loss, I thought the price was determined my what buyers and sellers are willing to deal at, not what internet jocks think that prices should be. I can't wait till my neighbours house is what he paid for it 15 years ago, then I'll buy it...
Sorry but that comparison is invalid.

While property values are also subject to hyping up and panic buying, it is fact that with the increase of population in the best cities and the inevitable impossibility of supply keeping up with demand, as a property is rather immobile, and space to build more is limited, a price increase in some areas is a given.

However... there are places where you can buy a house today for less than it would have sold for 5 years ago... when it's value may have been hyped up beyond true demand, and in some cases simply because the demographics may have changed.

Back to your question "what the perceived value should be" - a simple one I referred to earlier, the correct value will be what:

"...a reasonable person truly interested in aircooled Porsches will compare to what else his money can get him and conclude that he will derive more pleasure from the Porsche than the alternatives."

I.e. sweet FA to what it "could" be worth, and all about what value it represents.

sng45

497 posts

175 months

Saturday 8th August 2015
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Whilst it's always a better experience to come out of a car ( whatever car ) making money rather than losing it, I suspect very few of us will breath our last at 90 years of age smiling and thinking of the twenty grand profit that dropped into the building society passbook some years before from the sale of a car - more likely the smile may be due to an exhilarating drive we had with great friends in a great car driving over the Alps, the Pyrenees or the highlands of Scotland ! Who ( really ) gives a toss about investment first and driving pleasure second - surely we should be posting on the forums of Investors Chronicle rather than Pistonheads if that was our sole purpose !
If my main aim was to make a profit out of buying a car, rather than driving it, I suspect I may change my career and become a car dealer ! for the last thirty years since passing my test my cars have been purchased because 1. I wanted one 2. I was fortunate to have the finances to buy it 3. I always work on the principle that ( as far as I'm aware) I'm only here once 4. I can't help myself !
I've owned a lot (loads) of cars, because I wanted them and enjoyed driving them. When I saw another car I wanted, I (sometimes) sold something and bought that - I'm so shrewd when it comes to that bit, that I sold the last of my four 2.7RS's at £145 grand ! my last 356 Speedster at 65 grand and my 964 RS for 30K ( suddenly that career in car dealing doesn't look too rosy ! )
As I understand it the basic principle of all business is based on supply and demand, I've just bought myself a 20,000 mile, manual, 996 Turbo X50, I've been looking for one for quite some time and there don't seem to be many around - suppose it'll be nice if it goes up but prime reason for buying was to drive it.Maybe I paid too much for it, maybe I didn't , but it'll certainly get used rather than just sit in the garage. I'd be intrigued to know how many people really don't drive their cars for fear of reducing the value. Perhaps the answer is to buy a Ford Fiesta and we'd have no concerns over the infamous bubble !
Also just bought a 1973 Datsun 240Z off a guy in LA via American e-bay, it was $15,000 dollars so I suppose that bubble can't fall too much if it bursts and I'll probably enjoy driving it more than the Turbo !


Edited by sng45 on Saturday 8th August 20:33


Edited by sng45 on Saturday 8th August 20:35

cseven

214 posts

235 months

Saturday 8th August 2015
quotequote all
sng45 said:
Whilst it's always a better experience to come out of a car ( whatever car ) making money rather than losing it, I suspect very few of us will breath our last at 90 years of age smiling and thinking of the twenty grand profit that dropped into the building society passbook some years before from the sale of a car - more likely the smile may be due to an exhilarating drive we had with great friends in a great car driving over the Alps, the Pyrenees or the highlands of Scotland ! Who ( really ) gives a toss about investment first and driving pleasure second - surely we should be posting on the forums of Investors Chronicle rather than Pistonheads if that was our sole purpose !
If my main aim was to make a profit out of buying a car, rather than driving it, I suspect I may change my career and become a car dealer ! for the last thirty years since passing my test my cars have been purchased because 1. I wanted one 2. I was fortunate to have the finances to buy it 3. I always work on the principle that ( as far as I'm aware) I'm only here once 4. I can't help myself !
I've owned a lot (loads) of cars, because I wanted them and enjoyed driving them. When I saw another car I wanted, I (sometimes) sold something and bought that - I'm so shrewd when it comes to that bit, that I sold the last of my four 2.7RS's at £145 grand ! my last 356 Speedster at 65 grand and my 964 RS for 30K ( suddenly that career in car dealing doesn't look too rosy ! )
As I understand it the basic principle of all business is based on supply and demand, I've just bought myself a 20,000 mile, manual, 996 Turbo X50, I've been looking for one for quite some time and there don't seem to be many around - suppose it'll be nice if it goes up but prime reason for buying was to drive it.Maybe I paid too much for it, maybe I didn't , but it'll certainly get used rather than just sit in the garage. I'd be intrigued to know how many people really don't drive their cars for fear of reducing the value. Perhaps the answer is to buy a Ford Fiesta and we'd have no concerns over the infamous bubble !
Also just bought a 1973 Datsun 240Z off a guy in LA via American e-bay, it was $15,000 dollars so I suppose that bubble can't fall too much if it bursts and I'll probably enjoy driving it more than the Turbo !


Edited by sng45 on Saturday 8th August 20:33


Edited by sng45 on Saturday 8th August 20:35
Great post, could not agree more smile

Wozy68

5,387 posts

169 months

Saturday 8th August 2015
quotequote all
996TT02 said:
Crimp said:
I'd like another SC as IMO it was the best air-cooled car I owned but looking at the adds 25k+ for a bloody Targa and 35k for a coupe its a no no. Its not that I can't afford it, I just know the cars are not worth it.
Precisely.

Not that long ago I did not buy a 993 coupe at 25k for the same reasons.
You're just both not seeing the bigger picture. When did old cars being enjoyable to drive plus value for money come into it over the last few years?

Look at the bigger picture. TR4 ...... slow and they built thousands, a very good one is near 30K, its still a slow TR4 and even rebuilt, still a very shockingly built car. Mini Cooper S .... they built 72K of them, yet a Cooper S can be 30K plus.

I've owned both of the above, neither come close to rarity/performance/bragging rights of a 911, whichever model.

Am I happy old 911s are quite valuable these days? Nope, but they still are not anymore valuable than some really mediocre stuff out there.


mollytherocker

14,365 posts

208 months

Saturday 8th August 2015
quotequote all
Wozy68 said:
You're just both not seeing the bigger picture. When did old cars being enjoyable to drive plus value for money come into it over the last few years?

Look at the bigger picture. TR4 ...... slow and they built thousands, a very good one is near 30K, its still a slow TR4 and even rebuilt, still a very shockingly built car. Mini Cooper S .... they built 72K of them, yet a Cooper S can be 30K plus.

I've owned both of the above, neither come close to rarity/performance/bragging rights of a 911, whichever model.

Am I happy old 911s are quite valuable these days? Nope, but they still are not anymore valuable than some really mediocre stuff out there.
Nice bit of perspective! Bang on.

g7jhp

6,958 posts

237 months

Saturday 8th August 2015
quotequote all
Wozy68 said:
You're just both not seeing the bigger picture. When did old cars being enjoyable to drive plus value for money come into it over the last few years?

Look at the bigger picture. TR4 ...... slow and they built thousands, a very good one is near 30K, its still a slow TR4 and even rebuilt, still a very shockingly built car. Mini Cooper S .... they built 72K of them, yet a Cooper S can be 30K plus.

I've owned both of the above, neither come close to rarity/performance/bragging rights of a 911, whichever model.

Am I happy old 911s are quite valuable these days? Nope, but they still are not anymore valuable than some really mediocre stuff out there.
But this is the classic car bubble. Lots of old cars which (most of which are crap to drive) which people are ploughing their money into because rises have outstripped proper investments.

The right 911 shouldn't lose too much, but the servicing and maintenance will eat into an profit. The wrong car can be ruinous from a restoration or resale perspective.

Speculators aren't buying into the driving experience, it's all about the upside and when it crashes they'll get burnt.

highway

1,928 posts

259 months

Saturday 8th August 2015
quotequote all
A 991 is losing £400 per month. A good AC car is slowly appreciating each month. You can go the OPC and order the shiny new new. Every 6 months there comes something faster or better. You can chase that or you can embrace the pinnacle of the past.

A 993 is comparable as a driving experience to 991 in that they are both cars and both made by the same marque. Other than that they are different species.

You can't order a new AC to your spec. You can scour the classifieds that someone is selling something close to what you desire. I wanted a low miles 993 manual coupe in black with black. I wanted Air con. Eventually I got one. I wouldn't have bought a tip or a cab or something in a colour scheme not to my liking. Thus I don't see the argument that ALL AC cars are worth lots because the best ones are. Buyers can't be that dim. The best AC will keep rising. Haters gonna hate.

mollytherocker

14,365 posts

208 months

Saturday 8th August 2015
quotequote all
g7jhp said:
But this is the classic car bubble. Lots of old cars which (most of which are crap to drive) which people are ploughing their money into because rises have outstripped proper investments.

The right 911 shouldn't lose too much, but the servicing and maintenance will eat into an profit. The wrong car can be ruinous from a restoration or resale perspective.

Speculators aren't buying into the driving experience, it's all about the upside and when it crashes they'll get burnt.
I dont buy this.

People arent buying these cars because of financial reasons! They are buying them because they are what they want, they are their dream car! There are always exceptions of course.

As cars get ever more electronically controlled and sanitised, there are a group of crazy petrol heads who dream of the old smells and tactility of the old school cars. Its why Escorts are silly money. It is not gonna change.

When I see and hear a Spitfire or a Steam Engine I get the same joy. Its real mechanical joy!

pete a

3,799 posts

183 months

Saturday 8th August 2015
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mollytherocker said:
When I see and hear a Spitfire or a Steam Engine I get the same joy. Its real mechanical joy!
Well, I'd love a new GTS and currently have a fairly modern 997, but that steam train bit just got me, I love going on any train as I'm a bit of a train geek (don't tell anyone I've got a reputation to think off lol) but god I love steam trains, there really is something magical about the whole thing.

It seems I'm going to have to get a drive in something air cooled at some point to feel the magic myself, if anyone fancies a meet up and let me drive their 964 or 993 they are welcome to follow me in my 997 GT3.

I can't do it for a few weeks due to holidays and I'm getting a front end respray to get rid of a couple of annoying stone chips, but some time September maybe if anyone fancies it.



Edit to add to that though it's going to have to be pretty fking magic to convince me a 964 c2 is worth £48k.

As Samuel L Jackson said "We gotta be talking about one charming mother fking pig"

Edited by pete a on Saturday 8th August 22:57

355Chris355

134 posts

112 months

Saturday 8th August 2015
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The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants. A price can be justified by a rational buyer under the belief that another party is willing to pay an even higher price. Or one may rationally have the expectation that the item can be resold to a "greater fool" later.

DKL

4,480 posts

221 months

Saturday 8th August 2015
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I get the impression reading this thread amongst others that people are starting to be reluctant to pay the asking prices in case they are buying at the top of the market.
Perceived value is starting to be used up - its been said by several on this thread. Is that really worth that etc
Once the enthusiasts stop buying the investors will too as there has to be some semblance of "knowledge" to the price being paid. Really rare, old stuff and especially that with provenance of being special will be worth what someone wants to pay but you can't say that of your average SC or 3.2 there are just too many out there.
The problem is, as in 08, that if the market crashes so will everything else and we may just all be better off with a buoyant economy and "high" classic car prices. Adjustments will happen and for some the new (current) price will still be just too high to justify but that's just the way of the world.
I'd love a 1071S to be 8k and maybe selling my 996t last year ago wasn't the best choice in hindsight but I'm making through the economy elsewhere so its just give and take.

EnS

97 posts

148 months

Saturday 8th August 2015
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cseven said:
Great post, could not agree more smile
Although i'd have to beg to differ that i'm sure you'll get more enjoyment driving the 996T than the Datsun - and even if you put quite a few miles on your low mileage Porsche your bubble will not burst but grow - wait & see.

mollytherocker

14,365 posts

208 months

Saturday 8th August 2015
quotequote all
355Chris355 said:
The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants. A price can be justified by a rational buyer under the belief that another party is willing to pay an even higher price. Or one may rationally have the expectation that the item can be resold to a "greater fool" later.
Tracey Emin sold her unmade bed for what? £10m? Now thats where crazy town is.

On that basis, I would value a 964C2 at about £2bn. But it doesn't work like that does it?

I think you are underestimating the guy or lady who buys a 964 for 40k. I expect they know exactly what they want.

mollytherocker

14,365 posts

208 months

Saturday 8th August 2015
quotequote all
pete a said:
Well, I'd love a new GTS and currently have a fairly modern 997, but that steam train bit just got me, I love going on any train as I'm a bit of a train geek (don't tell anyone I've got a reputation to think off lol) but god I love steam trains, there really is something magical about the whole thing.

It seems I'm going to have to get a drive in something air cooled at some point to feel the magic myself, if anyone fancies a meet up and let me drive their 964 or 993 they are welcome to follow me in my 997 GT3.

I can't do it for a few weeks due to holidays and I'm getting a front end respray to get rid of a couple of annoying stone chips, but some time September maybe if anyone fancies it.



Edit to add to that though it's going to have to be pretty fking magic to convince me a 964 c2 is worth £48k.

As Samuel L Jackson said "We gotta be talking about one charming mother fking pig"

Edited by pete a on Saturday 8th August 22:57
We might be able to agree a deal here, but I am a bit nervous about letting anybody drive my car due to an er... Incident about 7 years ago. I would want insurance in place for both of us.

Where are you?

mollytherocker

14,365 posts

208 months

Saturday 8th August 2015
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anonymous said:
[redacted]
As usual cmoose, you present a logical argument. But this is not logical, its emotional.

I think there has been a sea change in the last 3 years. Its an acumilation of a number of factors coming together and making the perfect storm. I think you know what they are.