Posted on 08/29/2009 11:52:13 PM PDT by the invisib1e hand
Someone who bought a rare Bugatti, Jaguar or Ferrari in top condition would have done better during the downturn than an investor in almost any other asset, industry observers say, including stocks, fine art or even gold.
“There has been a flight into real assets,” says Historic Automobile Group founder Dietrich Hatlapa, a former Baring Securities and ING banker and collector who designed the HAGI Top, a new index that tracks the prices of a cross-section of historic cars.
“People want something they can look at and touch in the evening, rather than a piece of paper in the bank.”
While turnover at top classic car auctions has fallen since before the financial crisis, auction houses are still reporting brisk business, and setting records.
Earlier this month, the 1965 Shelby Daytona Cobra Coupe driven to victory by Bob Bondurant in Reims sold in Monterey for a record $7.25m, the highest price ever paid for an American car at a public auction.
“We’re seeing certain cars making more money than they’ve ever made before, especially cars with brilliant provenance or that are inherently rare,” said James Knight, head of the global motoring department at Bonhams, the auction house.
Bonhams reports a sale rate of 80 to 98 per cent at its recent car auctions, compared to a norm of 60 to 80 per cent. Rare Edwardian and “veteran” motor cars from the dawn of automaking are doing particularly well.
“Overall, prices have held up very, very well,” says Dave Kinney, publisher of Hagerty’s Cars That Matter, a US group that also publishes a collectors’ car index. “Part of the reason is that there’s passion involved in it.” His group’s “Blue Chip” index shows that values of 25 of the most sought-after cars have nearly doubled since late 2006.
Cars whose prices have suffered are those whose value rose sharply before recession, Mr Kinney said.
The HAGI index, which Mr Hatlapa designed with another former banker and which tracks 11 marques and 38 models, has risen by nearly 39 per cent from its launch at the beginning of 2008 to the end of July.
Artprice.com’s Art Price Global Index fell by 29 per cent in euro terms over the same period. The Liv-ex 100 Fine Wine Index, tracking 100 sought-after wines, fell by more than 10 per cent. Spot gold prices have risen by about 15 per cent since the beginning of 2008.
Any way, who cares ......so long as you're having fun.
This is why I have a 57 Bel Air and 67 Camaro.
I wonder if the trend holds for the lower end of the classic car market as well — i.e. not Bugattis and Grand Prix winners but production line Porsches and Chevrolets and stuff.
I dunno. All I know is I bought and sold a few muscle cars in my teens for under a thousand dollars that, with a detailing job and some new tires probably would have gone for 20 or 30 times that 20 years later.
I never bothered to figure out the rate of return that would have represented...
I can still be induced to grieve over the ones that got away. But there was that one...'69 RS, 327, 4-speed...did I mention it was a convertible? My brother wanted to sell it to me for 900, 1979 US dollars...
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MG TC Midget
Just a darling car. That’s ‘girl talk’, lol.
Looks like you were awake in the night and did some compositing. Very nice post.
A ‘T-Bird’ ? Beautiful sleek looking car.
Wonder if you saw the 75 RETRO cars I uploaded, that could be one of them. Took me forever to upload them all!
Looks like something Elvis would drive, huh?
Really pretty post!
BS, prices are down almost 50% from what they were 2 years ago.
Yeah, that was a really fun night with those 4........rowdy group....snicker.
Another beautiful post. Thank you.
You did a lot of work on those three posts!
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That ‘47 MG-TC would be rare today - parts for a full frame-off restoration to all factory original would be tough
Barret-Jackson customers seem to be allowing more updating modifications to make them more safe and perform up to modern sportscar standards
The ‘55-’56-’57 Ford T-Birds are often a huge bargain at auctions now - the top ones (like the ‘57 “E” model) going for $70,000-$120,000
But many great Baby-Birds are going for $21,000-$38,000
Some Retro-Mod Corvettes do not get top dollar (over $80,000+) some do
Buyers now want a beautiful fun car they can drive and enjoy - that will keep going up in value
Typical factory or used car buyers financing their cars (that instantly drop value like a stone!) never seem to notice their plain Jane cars cost more than classics bought outright for cash
So many beautiful old cars. But, most people wouldn’t want to drive the huge heavy hunks of metal like I have in my garage. Gasoline is too high now plus those old cars can be more awkward to drive.
Love my present car though and will never go down to one of those small ‘look alike’ ones on the road. Hard to tell one from the other.
There is an old Buick in that RETRO folder that is tri-toned, really pretty.
Gee that's great news for people who can afford something like this.
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