Has bubble burst on classic car prices?
Discussion
I am thinking maybe this is the case or if not its about to happen.Why were there so many lots unsold at the recent Historics auction http://www.historics.co.uk/previous-auctions/18th-...
no not at all other way round really
classic cars magazine or classicscarsforsale online did an article recently, many trebled their reserve/estimate was it villa d'este so not many people were around for one of the other ones
there was a lot of other stuff on when that auction was.
people coming out of property and cash into cars which is why stuff been going up in value a lot and will continue for a while.
classic cars magazine or classicscarsforsale online did an article recently, many trebled their reserve/estimate was it villa d'este so not many people were around for one of the other ones
there was a lot of other stuff on when that auction was.
people coming out of property and cash into cars which is why stuff been going up in value a lot and will continue for a while.
A sure sign of a bubble about to burst is:
Have Jaguar announced a really expensive supercar? Check.
Have they convinced enough people to cough up a deposit? Check.
Have they then announced the car will go into production? Check.
Did they also then change the spec so it bears little resemblance to the original concept? Check.
Hang on, this sounds familiar.....
Based on the above, I think the bubble has about 1 year to pop.
Have Jaguar announced a really expensive supercar? Check.
Have they convinced enough people to cough up a deposit? Check.
Have they then announced the car will go into production? Check.
Did they also then change the spec so it bears little resemblance to the original concept? Check.
Hang on, this sounds familiar.....
Based on the above, I think the bubble has about 1 year to pop.
Mermaid said:
Even as interest rates rise?
markets are pricing in a rate rise in december ish this year but who knows what will happen before then.if rates rise then property imho may fall a little as iirc 2/3 of mortgage holders are on variable rates. I think property could then be seen in a worse light as it is at present.
all of a sudden parking 40k in a testarossa doesn't seem like a bad thing.
interest rates were much higher in the last classic car boom in the eighties
see bofe stats here
Thu, 21 Jul 1988 10.38
Thu, 07 Jul 1988 9.88
Fri, 24 Jun 1988 8.88
Fri, 10 Jun 1988 8.38
Fri, 03 Jun 1988 7.88
Tue, 17 May 1988 7.38
Fri, 08 Apr 1988 7.88
Thu, 17 Mar 1988 8.38
Mon, 01 Feb 1988 8.88
Thu, 03 Dec 1987 8.38
Wed, 04 Nov 1987 8.88
Fri, 23 Oct 1987 9.38
Thu, 06 Aug 1987 9.88
Fri, 08 May 1987 8.88
Tue, 28 Apr 1987 9.38
Wed, 18 Mar 1987 9.88
Mon, 09 Mar 1987 10.38
Wed, 15 Oct 1986 10.88
Fri, 23 May 1986 9.88
Fri, 18 Apr 1986 10.38
Fri, 11 Apr 1986 10.88
I think with inflation as it is (high in my opinion) then some could even say that if tangibles just kept up with inflation then they would keep rising. for them to fall in nominal terms then i think that's difficult to do with high inflation.
for example
if a testarossa came to 25k then surely we'd all have one as that's not much really nowadays
if a mint e type or big healey came to 30k then we'd all be having a dabble
in the late 80s cars were going for 200k a pop like testarossas and now, even after 20 years of inflation they are at 40k so I don't think we can see a fall
i'm no classic car expert at all though, but where do you put your money when commodities are high, gold is high and house prices potentially falling?
A lot of people have bought them as investments, as although they might not appreciate as much as, say art or a house, you can have more fun in a classic and get into a whole new social "scene". Its no coincidence that the rise in popularity of the Godowood events is matched by the sudden interest in old cars.
Even Nick Mason has got into the act, and announced he has joined an investment fund using classics as collatoral.
So no, I dont think it has burst, and or certain types of car will only go one way...
Even Nick Mason has got into the act, and announced he has joined an investment fund using classics as collatoral.
So no, I dont think it has burst, and or certain types of car will only go one way...
wibble cb said:
A sure sign of a bubble about to burst is:
Have Jaguar announced a really expensive supercar? Check.
Have they convinced enough people to cough up a deposit? Check.
Have they then announced the car will go into production? Check.
Did they also then change the spec so it bears little resemblance to the original concept? Check.
Hang on, this sounds familiar.....
Based on the above, I think the bubble has about 1 year to pop.
i'd quite like it to pop though Have Jaguar announced a really expensive supercar? Check.
Have they convinced enough people to cough up a deposit? Check.
Have they then announced the car will go into production? Check.
Did they also then change the spec so it bears little resemblance to the original concept? Check.
Hang on, this sounds familiar.....
Based on the above, I think the bubble has about 1 year to pop.
I wouldn't mind getting a couple more cars 
an E30 sport evo for about £15k would be on my radar along
jonah35 said:
interest rates were much higher in the last classic car boom in the eighties
see bofe stats here
I recall those days - F40 & 959 were vying for a half million price. But those days were also the big bang yuppy days, were they not? A lot of money sloshing around for the 1st time & people who had become wealthy overnight.see bofe stats here
There is no classic car bubble and it is not about to burst. There are really no similarities between today and 1989.
In the late Eighties people were buying cars for investment using borrowed money, really bad E-types were being bought for £150k, etc the minute they rolled off the delivery truck, there was incredible liquidity and demand was pushing supply. Even the savviest dealers got caught with stock.
Today, average cars sell for average money, people are buying for fun with very little borrowed money sloshing around. People are informed and are making careful decisions, there is no rush out there.
There has always been strong money for great, rare cars, nothing has changed there. But there are some models, Aston DB4,5,6 for instance that have shot up in recent years but this is more to do with them being undervalued in recent times and also being the first car most people have on their "Must buy" list.
£200k today for a fully restored DB5 is not crazy money compared with art, wine etc but back in the day £200k was being spent blind by someone in Japan on a bag of broken bits with Ferrari written on. No-one mention the recent Bonhams Auction at Aston Martin please, as this bears no relevance to the market today, it is a little parallel universe that exists for one day once a year, and Bonhams are more than happy with what they have created!
Anyway, those are my thoughts on the matter, I still have old cars in my garage instead of a pension fund (But I would also have Art)and now is as good a time as any to buy a classic car for fun and investment, just choose carefully and speak to people who know what they are doing.
Justin
In the late Eighties people were buying cars for investment using borrowed money, really bad E-types were being bought for £150k, etc the minute they rolled off the delivery truck, there was incredible liquidity and demand was pushing supply. Even the savviest dealers got caught with stock.
Today, average cars sell for average money, people are buying for fun with very little borrowed money sloshing around. People are informed and are making careful decisions, there is no rush out there.
There has always been strong money for great, rare cars, nothing has changed there. But there are some models, Aston DB4,5,6 for instance that have shot up in recent years but this is more to do with them being undervalued in recent times and also being the first car most people have on their "Must buy" list.
£200k today for a fully restored DB5 is not crazy money compared with art, wine etc but back in the day £200k was being spent blind by someone in Japan on a bag of broken bits with Ferrari written on. No-one mention the recent Bonhams Auction at Aston Martin please, as this bears no relevance to the market today, it is a little parallel universe that exists for one day once a year, and Bonhams are more than happy with what they have created!
Anyway, those are my thoughts on the matter, I still have old cars in my garage instead of a pension fund (But I would also have Art)and now is as good a time as any to buy a classic car for fun and investment, just choose carefully and speak to people who know what they are doing.
Justin
I'm not sure there was/is that much of a bubble. My cousin rebuilt old No1 which went to court because it was owned by a bank and didnt realise their expectation. I dont think there is irresponsble bankers money pushing the price. If they are not selling I believe its due to unrealistic asking prices from people who are following the 80s crash.
, Sellers seem to have an inflated idea of what their cars are worth!.meadowhog said:
I'm not sure there was/is that much of a bubble.... If they are not selling I believe its due to unrealistic asking prices from people who are following the 80s crash.
Agree with that. I think that the market is also much more selective than it was. In general - really good stuff is selling readily and for strong money. Middle of the road cars are not.
Problems occur when the owners (sellers) are unable to differentiate which category their car falls into.
The one category that I can't understand is the "barn find" or unrestored wreck that frequently seem to achieve higher prices than restored examples.
mph said:
The one category that I can't understand is the "barn find" or unrestored wreck that frequently seem to achieve higher prices than restored examples.
People often have romantic dreams of restoring a car thats been slumbering in a barn, back to life, hence the high amount that they are willing to pay for something that they think nobody has been into before . . . to the point that as you've said, the basket case is often fetching more than a car you could at least use a little before pulling it all apart.I can't speak for other marques, but I think that some of the prices for Mk2 Escorts (and Mk1s come to that) are starting to get a bit silly and that's coming from someone who owns one. I don't know whether this is another 'peak' and they'll all go downhill soon (probably just after I finish getting mine back on the road, ready to sell ) or whether they're going to increase further. It's a moot point for me as I'll be buying another 'classic' car so in general if they come down, so will what I want to buy (I hope). I don't treat it as an investment, but I'd imagine that £4,500 (what my parents paid for it) to about £10,000 over 30 years isn't that much of an increase once you factor in repairs and maintenance.
Cars should be about driving IMHO.
) or whether they're going to increase further. It's a moot point for me as I'll be buying another 'classic' car so in general if they come down, so will what I want to buy (I hope). I don't treat it as an investment, but I'd imagine that £4,500 (what my parents paid for it) to about £10,000 over 30 years isn't that much of an increase once you factor in repairs and maintenance.Cars should be about driving IMHO.
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