Take the recent rise in classic Porsche prices. These cars could be traded a few years ago for around the same price as a base model Tesla Model S. Now, the price for classic air-cooled Porsche’s have skyrocketed. But as the number of Porsche’s out there dry up, and the buyers of these begin to die off (sorry), you’ll see the price of these cars tumble just as much as we saw the price of muscle cars tumble.
However, that doesn’t mean that classic cars are bad investments. On the contrary, they can make amazing investments, provided you do your research, pay attention to trends, and purchase the right car. Just like stocks, cars need to be analyzed to make sure they will be profitable in the future.
Low miles, while a sin in any enthusiasts book, actually matters quite a bit in the collector car market. Same with low production volume, and low serial numbers. Additionally, when first looking for a car that could appreciate in value, you need to look at the cars history and provenance.
For example, the Ferrari Dino used to be an absolute pariah in the Ferrari community. Ferrari enthusiasts practically shunned the car from all events. Then a few years back, people began seeing the inherent beauty of the car, and the history behind it. Dino prices began to tick upwards. Not so much that they’d cause a riot, but just a slight rise in value.
Personally, I lamented this uptick since I had always wanted a Dino, and for a while there, I thought I might be able to own one in my lifetime. However, Dino prices are now edging ever closer to the seven-figure mark, and all my hopes have vanished.
Classic cars can indeed be bad investments, as well as hugely successful ones, but as mentioned above, you need to treat them like stocks. Do you homework and you have a far less likely chance of getting burned when it comes time to sell.
And while some of you may think you need to already be wealthy to play this game, the Dino I spoke of above, in 2006 was going for under $50,000. One just sold for over $400,000. There are plenty of other cases such as this out there; you just have to know where to look.