Market correction in the offing....? (Used car values)
Discussion
Anyone else feel a correction coming on? Particularly in terms of higher value used cars e.g. Porsche 911s. Some models e.g. 997s have gone up over the last few years and of course you have GT3s and so on changing hands at higher than original sales price. But Brexit is round the corner, possible other stuff which may impact market conditions and I wonder if some people are going to be left holding the baby when the music stops. What I mean specifically is people owning a car, very likely financed, of high value (£50k - £150k) that they thought wouldn't depreciate too badly but actually if there is a correction would end up losing a large chunk of cash, in the tens of thousands, in short order.
I've been keeping an eye on values of some specific cars in that price bracket and have seen some price reductions at dealers in the last few weeks - a grand here, couple of grand there; which says to me either a) they're overvalued intentionally to start with to see if some sucker pays the asking, or b) they're actually hanging around unsold because the market thinks they're overvalued, because the market foresees a correction if perhaps not a full scale crash ahead.
Thoughts?
I've been keeping an eye on values of some specific cars in that price bracket and have seen some price reductions at dealers in the last few weeks - a grand here, couple of grand there; which says to me either a) they're overvalued intentionally to start with to see if some sucker pays the asking, or b) they're actually hanging around unsold because the market thinks they're overvalued, because the market foresees a correction if perhaps not a full scale crash ahead.
Thoughts?
Just as there is a slow moving truck at the end of every long straight, so there will be a correction in values of anything after period of sustained growth.
It will not be so much down to people borrowing directly on classic cars, but more that classic car ownership is highly discretionary and therefore amongst the first things to be given up when the going gets tight.
Self employed people and business owners seeing a reduction in income in an economic downturn might look to realise the cars' values to reduce outgoings in other areas of their lives.
If too many people do this at once then supply exceeds demand and values wain or collapse. Those who have capital available will be able to pick up bargains when it happens.
It will not be so much down to people borrowing directly on classic cars, but more that classic car ownership is highly discretionary and therefore amongst the first things to be given up when the going gets tight.
Self employed people and business owners seeing a reduction in income in an economic downturn might look to realise the cars' values to reduce outgoings in other areas of their lives.
If too many people do this at once then supply exceeds demand and values wain or collapse. Those who have capital available will be able to pick up bargains when it happens.
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