RE: Price hike: PH Blog

RE: Price hike: PH Blog

Thursday 5th June 2014

Price hike: PH Blog

The £200K 360 CS has left Chris bemused; where will it end?



A Tweet the other day in response to me saying how much I was still enjoying 512 TR ownership. It went along the lines of "I thought after the promotion you'd given them with that video last year, prices would have risen, but they haven't".

There's no denying Chris rated the CS...
There's no denying Chris rated the CS...
I hadn't really looked at TR prices since last year, but on reacquainting myself with them, they appear to be higher. In some cases, much higher. I bought a perfect 6,000-mile car in 2009 for £54,000, and sold it a year later. There's a chap currently asking £150,000 for one showing more than double the miles. Whether he achieves that sum is another question, but within a market place currently hissing to the vapours of potential over-heating, the asking price doesn't seem unusual. I mean, £200K for a right-hand drive 360 Challenge Stradale - you have to be joking, right?

For better or worse I tend to view the market in such reactionary, emotional terms. I absorb the asking price and then decide if I think it sounds like lunacy or not - based on driving, condition, provenance, styling, significance and many other factors including the deeply scientific oh-crap-I'd-just-really-like-one-of-those. Perhaps the most interesting aspect of my current position given the volume of bubble-talk is that not everything makes me tsssk with opprobrium - in light of the exponential increase in value for some machines, there is still some value out there. For instance I noticed a post in the forums the other day about a very low miles E30 M3; people were amazed that these cars are climbing towards three figures.

Now compared to where they've been for the past two decades, that sounds crazy, but consider that in terms of pure provenance as both a drivers' car and for competition pedigree, the only thing that comes close to the E30 M3 is a Porsche 911 2.7 RS. And even its racing record pales next to the BMW's. A bad 2.7 RS is probably worth £400K now. A good one far more. A famous one is currently for sale at over a million pounds.

But for £200K? Not that good
But for £200K? Not that good
Yes, they built 1,600 of them, whereas nearly 10 times the number of M3s left the line. But attrition and an elongated race career must have halved that number today. Viewed in those terms, a mint 25,000-mile M3 Sport Evolution (the funky 2.5 limited run model) for £85,000 looks like a steal to me. The equivalent 2.7 RS would be not far off ten times the price. In fact they look so undervalued compared to what's going on around them that I've just bought a leggier 2.5 Sport Evolution myself, so I can tell you whether it's tears or celebration a year from now. Either way, it's a dream come true for me and a hell of a car.

The Ferrari market is borderline nuts now. The F40 I used to shoot with an F50 is probably worth £200K more today than it was the day in July we filmed it. Values of F50s are leaping as are Enzos. Anything older and less geometric now commands a price that looks like it should be attached to a house in Holland Park - only it won't have an asking price because it will say POA. And you, like me, will probably punch something when you see that.

E30 rise overdue says Chris
E30 rise overdue says Chris
I am constantly fascinated by the complex relationship between what we think something is worth, what the market thinks it might be worth and how that vehicle then sits with its peer group. Take the 997 GT3 RS for example - the best model line of performance cars I've driven in my professional life. The recent jump in values has taken people by surprise, but with Porsche fannying around with the 991 GT3 engine debacle and the move to electric steering and paddles, is it any wonder people are snapping up what is clearly the last car of its type to come from Stuttgart? Is £125K too much for a 3.8 RS? Not in my book.

Judged for rarity, provenance, ability and driver appeal, it's worth double that. In fact if a 360 Challenge Stradale is heading for £200K, the Porsche is worth £300K. Where does that leave the 4.0 RS? Somewhere north of that figure, not that I need reminding. Put it this way - if you plonked a 4.0 RS into a magazine end-of-year group test scenario and the judging criteria were based on interaction and speed, I think it would still beat all the 2014 competition.

And where on earth are these going?
And where on earth are these going?
But if a 4.0 RS is, say, £300K (not sure if they are, but give it five minutes and they might be) then why is a Carrera GT nearly the same price? One is a posh Beetle, the other is a carbon-tubbed masterpiece born of an aborted Le Mans racer. And it happens to be plain beautiful. You see what I mean? These artificial ceilings are fascinating because they seem to exist in every corner of the market - I say 'seem' because they are transient; the CGT is ripe to move up to the next price category and leave yet more headroom for the 4.0 RS to attain even sillier prices.

Is this all about to go pop? With the number of people saying that it is, and imminently, I'm inclined to disagree. Consensus in the car market tends to mean misinformation. I think it will cool a touch, but what seems to be happening is that the rarest lumps of unobtanium disappear into a world of collectors and oligarchs and the next rung down fills that empty space, but remains too valuable for any normal person and then prices begin to cool.

£400K and upwards for a 2.7 RS
£400K and upwards for a 2.7 RS
Not crash, just slow - perhaps the point of a small correction and a little pain for those who bought at the absolute peak. Meantime, everyone else is still looking around for the next big thing, and I still think values of those less-obvious gems can continue to rise even if the very top of the market has slowed slightly. Even if the F40s et al continue to rise, I think it just encourages those who can't afford one to push up the values of the best substitutes - hence the silly 360CS prices may continue. So the time of the Ur Quattro, the Integrale, the Sierra Cossie, some of which have moved already, might soon come to pass.

There be danger lurking in this strategy though. When Ferrari 400s cease being comedy bangers for The Thread, you need to mark a note of caution. Or, as the buyer, be prepared to just own and enjoy the car. Because this does now feel like one of the great historical spikes in prices.

And as one seasoned player recently reminded me: enjoy the ups, and just ensure that if it does go pop, you're left with something you own outright and which can continue to savour as an enthusiast. Reckon the E30 fits that description.

Chris

Author
Discussion

drakart

Original Poster:

1,740 posts

218 months

Thursday 5th June 2014
quotequote all
You've bought another car?! Is it written into your contract that makes you have to do this? laugh

Merc Gullwing prices have shot up recently too. At auction at Goodwood in 2007, one could have bought a minter for £140-170k. now they are more like £800k... It can't continue!

breezer42

141 posts

159 months

Thursday 5th June 2014
quotequote all
There are some strange anomalies - e.g. DB7s for under £20k, Ferrari 355s for £40k. Seem way too cheap for the last of their kind.

Grandfondo

12,241 posts

214 months

Thursday 5th June 2014
quotequote all
It's not what it's worth,it's what someone is prepared to pay!

GTEYE

2,179 posts

218 months

Thursday 5th June 2014
quotequote all
I almost weep thinking back about the missed opportunity I had to buy a low miles Sport Evo for £18k back in the late 90s...

dbhenshall

36 posts

148 months

Thursday 5th June 2014
quotequote all
Great article as ever by Chris. It is what people are willing to pay, but way too many people buying who don't intend / want to drive these cars, which is just a crying shame. Buy the best you can afford both to purchase and to drive

leon9191

752 posts

201 months

Thursday 5th June 2014
quotequote all
Excellent work with the E30 Chris.

As a point of note I saw an Escort Cosworth up for £50,000.00 the other day, it had 8K on the clock but still crazy money on the face of it.

Good point on the 997 GT3 as well, the prices have gone through the roof in the last 12 months, they seemed to go from 50K to 70K over night breaking my heart in the process.

melvster

6,841 posts

193 months

Thursday 5th June 2014
quotequote all
It's crazy seeing how quickly some of the cars mentioned have appreciated in value, especially the 360CS. It wasn't that long ago when a RHD minter could be had for 90K.

Chris, thread and pics on the E30 M3 SportEvo ta thumbup

flashygee

127 posts

219 months

Thursday 5th June 2014
quotequote all
Im a observer of the Classic Market too,and cant understand pricerising for few Massbuilt Cars like the 911.
But outside of Wealthy Collectors the real World tells a another Story.
A Friend of mine has Family now and builds a House and needs Money-his Pride and Joy was a Mercedes 190 2.3 16V in Black
with Black Full Leather in new Condition unmodified (He is MB Engineer and Member of the Mercedes 190 2.3 16V Club) and he has sold
his Dreamcar.
On Platforms like Classicdriver is the Value by Dealers of these Car 25-30 thousand Euros for Cars not in these Great Condition
and with higher Mileage.
I tell him "You have sold it,How much?-his Answer,10000 Euros Cash.
I showed him the Cars @ Classicdriver and so on,but his Answer was "Thats Phantasyprices,no one Pays so much for it in the Real World"
And ,hes right.
What comes next VW Beetle for 500000 Euros-common...

QuattroDave

1,588 posts

136 months

Thursday 5th June 2014
quotequote all
I have the (occasional) pleasure of owning a UR quattro and I always keep an eye on the prices being asked for examples. Compared with its contemporaries (Integrale, Cosworth and to a lesser extent M3's) it's a relative bargain.

Sure there are many listed at £15-20k but rarely do they sell for that. Seems £9-10k will get you a relatively solid model which is considerably cheaper than you would expect to pay for a dog of an integrale and would barely buy you the rear view mirror of a cossie!


The sport quattro's (genuine ones!!) fetch hundreds of thousands but that then makes the prices of the standard UR's even more bizarre.

NotNormal

2,370 posts

222 months

Thursday 5th June 2014
quotequote all
breezer42 said:
There are some strange anomalies - e.g. DB7s for under £20k, Ferrari 355s for £40k. Seem way too cheap for the last of their kind.
TBH decent 355's are in the 60's now and appear to have moved up 20K in about 6 months.

It certainly makes life frustrating when aspiring to buy a new car. My dreams of F40 ownership are drifting away as saving thousands is a waste of time when they seem to be appreciating by the hundreds of thousands.

Its all a tad crazy as Chris has highlighted and will be interesting how it all pans out. scratchchin

anonymous-user

62 months

Thursday 5th June 2014
quotequote all
"Meantime, everyone else is still looking around for the next big thing" - indeed. It won't be cars though. You seem to believe that there is any rationality in a market driven by sentiment. There is none. It's the same with houses - pure denial. I fully respect your gung-ho approach to buying and selling though, don't get me wrong. I'm going to buy a couple of LS400's in Street Fighter 2 spec, and just put them away...

Not that I expect anybody to give a toss what I think - but this article is well timed. I call the absolute top of the market, right now.

Vee12V

1,360 posts

168 months

Thursday 5th June 2014
quotequote all
Many old Porsches are clearly over valued in my opinion, others like early Elise s1's aren't.
Still baffles me.

famfarrow

740 posts

162 months

Thursday 5th June 2014
quotequote all
Chris, I know it might be a bit of a bore to do but I really enjoyed your article a while ago on your garage.

Is it possible to get a similar updated article as it appears you have made quite a few changes! Its great to read about an enthusiast enjoyed his vehicles!

By the way is the rally BMW still around?

dlockhart

434 posts

180 months

Thursday 5th June 2014
quotequote all
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.

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.

Dale487

1,424 posts

131 months

Thursday 5th June 2014
quotequote all
Some prices are weird - £5k for a Celica GT4 and £25K for an Escort Cosworth, both have similar homolagation history and performance. I guess its that fast Fords have a following that Toyotas don't.

I think there may be an amount of ask a silly price & someone will pay it - how many cars spend months for sale at the same price?


JamesyBoy75

122 posts

165 months

Thursday 5th June 2014
quotequote all
What's most interesting to me is the prices of cars compared to their contemporaries. I see the NSX has started to catch up the 355 and 993 now, I think this group of cars were all very important to their parent companies.

As pointed out yesterday the Celica GT4 seems to be completely overlooked when compared to either the Integrale and especially the Cossie. The Cossie is really pretty agricultural compared to the Lancia and Toyota but compare the prices they go for now... Less than 4K for a very solid St185 or ST205 is remarkable value.

They prices of Lotus Carlton's vs the not even really competitive M5's seems very low, especially considering how few of them are left.

ratcatcher2

153 posts

201 months

Thursday 5th June 2014
quotequote all
I understand the next big thing is the 996 Carrera 4S which will rise in line with the 996 Turbo.

wildman0609

885 posts

184 months

Thursday 5th June 2014
quotequote all
I was chatting about this to some wealthy Aston martin collectors recently. They are shocked a barn find wreck of a DB5 sold for £497k + commission recently. Surely this is a bubble that has to burst some time. Standard DB5s are crap cars, that don't drive very nicely at all. When I asked them about DB7's they said no chance, they'll never be worth anything. I think the ford parts bin stigma put's off Aston collectors.

£200k for a 964rs is mental too. They were worth a lot as they are great to drive on the track, but at this value nobody would ever track one. A friend used to race a genuine 964rs, but had to retire it last year as the values are silly, so he has a regular C2 now which is no slower.

leon9191

752 posts

201 months

Thursday 5th June 2014
quotequote all
W124 said:
You seem to believe that there is any rationality in a market driven by sentiment. There is none. It's the same with houses - pure denial.
I dont think that is true though, if it was the case why do we put such great value in things like Art Work and Jewellery. If something is rare and sought after then it has value.

iloveboost

1,531 posts

170 months

Thursday 5th June 2014
quotequote all
Obviously we are in a massive rare/classic car price rise right now and I've no idea if it will end. I think it's as a result of the rich getting exponentially richer since the end of the nineties recession pushing the price of anything investable way up.
That's slightly sad because cars are being treated more like assets and not like cars. It's good if you're the one making money though and auction houses must be raking it in. I bet they have swimming pools filled with money and they have a swim around like Scrooge Mcduck:
http://www.youtube.com/watch?v=NBRrCY5uhWY
biggrin