Are classics about to crash in value....

[bababoom]

Ive been thinking about buying a fast ford mainly for the deprecation proof motoring,
With whats going on in the world at the moment and talk of anther recession looming do we think the value of classics are about to crash?
Lets keep this about cars and not what we already know about on the news. 

[Mercdan68]

In a word ...NO

[rsmithy626]

Done, thread locked.

[MkX]

In a word, Yes.

As far as 'Lets keep this about cars and not what we already know about on the news.' unfortunately the 2 are inextricably linked. 

We have been skating on the brink of a global recession for a while.
The UK, in particular, has been more at risk of recession due to Brexit, (I admit this as an active Brexiteer).
COVID-19, its effect on economies and the international markets, increases the likelihood of a worldwide depression, (a deeper and much longer lasting event than a recession).
Classic cars are always one of the first investments to take a big hit.
Petrol-engined cars, particularly thirsty old beasts, have been gaining increasing disapproval levels for years.
The Greta Thunberg effect is gaining momentum.
I think it's possible that this years 'car season' will be a non-event due to coronavirus.
It's likely a significant percentage of people who have the money and intended to invest invest in classics will be wiped out during 2020 and their money inherited by generations who perhaps have less interest in old cars.
It's likely a significant percentage of people who already own classics will be wiped out, thus dumping many additional cars onto a suppressed, flooded marketplace.

It will make me dreadfully unhappy to be proved right so I really hope mercdan68 's one word prediction pans out. On the flip side of the coin, if I'm somewhere near right, it could result in dream cars coming back into the ambitions of mere mortals! If it was my £, I'd wait 6 months before jumping.

[grizz]

But......

Markets do have a way generally of playing Bears n Bulls.

Let’s hope that the survivors manage to not fall under the influence of the Greta effect, which of course is permeating all avenues and levels of society.

[comfortablynumb]

I have one vehicle, a 1979 mini van, which I’ve been thinking about putting on the market to fund something else
An unrestored incomplete shell on eBay was £5k, with one bid when I looked the other day
Mine is restored but in kit form
I’ve decided to sit on it for a bit longer due to the uncertainty, it’s been in this state for about 4 years now, another couple won’t make any difference

[comfortablynumb]

I should add, ive got the vehicles I have because I want them, not as investments, which if anyone has seen my rrc is obvious!😳

[grizz]

Mar 15, 2020 8:16:29 GMT comfortablynumb said:

I should add, ive got the vehicles I have because I want them, not as investments, which if anyone has seen my rrc is obvious!😳

Agreed.

Never saw my cars as investments.

Most make money or break even due to effort put into them by me and RR friends. Only the MX5 lost me a lot of cash, but then Myrtle the 100E doubled its money and was directly offset by the MX5

Still a therapeutic hobby to me.

[bmcnut]

I think theres a possibility of a hit for the reasons MkX has pointed out, and it will probably hit the lower end of the market more. ie those with deep pockets may well still have deep pockets for the fully restored minters to stash away in their private collections, but it will be the value of the cars not in immaculate condition or those needing restoration that will take a hit. Or, we could all be wrong.

[joem83]

70's & 80's stuff will probably be unaffected, there is a possibility in 12m time it starts shooting up.

If the unfortunate happens and some of the older generation suffer the most, younger people may find they come into unexpected money and decide to buy stuff they wanted when they were younger but could never afford.

We just don't know, at moment investing in anything is risky short term.

[metalshapes]

Seems to me, there are several factors pulling in different directions.

As the older generation is dieing ( with or without the virus ), the cars they know and love will be flooding the market and the younger generation doesnt appreciate them.
This has been happening with restored Model A's for years.
Most young guys don't want to pay top dollar for a perfectly restored car that has all the performance and comfort of an old farm implement. ( If they can get it cheap enough they might turn it into a Hot Rod, though )

Right now a lot of disposable money is evaporating, so less toys will be bought.

On the other hand...
Depending on how much misery is around the corner, people may remember how easy and cheap pre-computer cars were to fix and maintain.

So the old cars that can be used as a daily driver might hold their value.

[metalshapes]

And BTW, I don't have a lot of sympathy for the people who have been using Classic Cars as commodities.
If and when they loose their shirt.

Seems to me there is a ripple effect that eventually reaches the cars we play with, for every multi million Ferrari, or whatever, that gets sold.
So any artificial bubble has an effect, going up as well as coming down ( remember when the bubble burst, and classics tanked in the '80s or '90s ? )

I'm a lot more concerned with the supplieres we need to keep our stuff running.

A lot of specialist went belly up, back then...

[Deleted]

The vast majority of my clients expend far more restoring a vehicle than the physical worth of the vehicle upon completion - merely based upon the fact that they appreciate the vehicle for what it is and not what it's worth - it maybe a vehicle that they have always promised themselves / a vehicle with family history / sentimental links or just simply something that they like the look of - they are of course many other reasons - Absolutely none of my clients own vehicles based on physical worth and if they did then their vehicles would not allowed be through my workshop doors.

I'm very fortunate in the respect that I don't have huge overheads & I don't want for work - I therefore have the luxury of assessing my clients and the passion that they have for the classics / retros that they have in their ownership - that passion element is far more important to me than what the make / model of the car is that enters the workshop.

You need to stop worrying about what your classic / retro is worth and get out there and enjoy using it / restoring it / polishing it - which is far more enjoyable and in my book 'priceless' - leave the modern vehicle owner who has just blown £40k on a shiny new over hyped motor do the worrying about depreciation

[Deleted]

Thanks and interesting. Rarely comment but here goes and possibly off topic- metalshapes exactly picks up my thinking about keeping our stuff running: availability of spares, insurance, skills or fuel. Fuel is the one that concerns me remembering the tapering out of 5*, leaded, LRP. Electric retros are possible which is great but expensive at the moment. I am watching how the falling demand for coal with the forthcoming ban on sales commercially affects the enthusiast sector of steam vehicles and railways. @grumpynorthener is right in enjoying what we have.

Values I don’t know really beyond the cliche of its worth what someone will pay (as someone who has paid both next to nothing and way more than I will ever see back for things that I liked or needed as well as sold stuff for far more than what I though it was worth). Economics isn’t my thing.

Thanks for the contributions.

[comfortablynumb]

A guy I used to know had a restoration shop in a village called Gillan in Cornwall, as in so far down if you went further you’d fall off the end!
I don’t know if he’s still in business, but he did the body restoration on my mums ‘woody’ mini, and a fine job he made of it too
The two restorations that stick in my mind he did were a mg roadster, where the guy had owned it since new, met his wife in it, etc etc, and wanted it restored
The car was fairly hanging, and when it was suggested it was reshelled he nearly had a coronary. Insisted that as much of the original car was kept, since money was not an object
I saw the car again just before it was collected, so say it was beautiful is not doing it justice, in fact at the time the MG owners club went to the garage and get him to sign up for their approved repairers list, which he later regretted because ‘I’m so bored of MGs!’
The other was a farmer with a marina pickup, again absolutely hanging, but for some reason replacing it was not on his radar, he spent loads on welding and so on, and was quite happy to drive his tractor whilst the endless repairs were carried out
However people like this were/are few and far between

[elfman]

I think older is still safer then modern especially if you have the right classic.( ones people like and want)
As an example a friend of mine is selling a Land Rover Evoque....its lost 12k in 2 years that's £115 a week !!
Cant think of many classics in our range doing that ?
But even if it did the older car would still go up in price once the panic is over the Evoque wont for a very long time, probably wont even last that long..

[halkyon]

Mar 15, 2020 0:25:03 GMT MkX said:

In a word, Yes.

As far as 'Lets keep this about cars and not what we already know about on the news.' unfortunately the 2 are inextricably linked. 

We have been skating on the brink of a global recession for a while.
The UK, in particular, has been more at risk of recession due to Brexit, (I admit this as an active Brexiteer).
COVID-19, its effect on economies and the international markets, increases the likelihood of a worldwide depression, (a deeper and much longer lasting event than a recession).
Classic cars are always one of the first investments to take a big hit.
Petrol-engined cars, particularly thirsty old beasts, have been gaining increasing disapproval levels for years.
The Greta Thunberg effect is gaining momentum.
I think it's possible that this years 'car season' will be a non-event due to coronavirus.
It's likely a significant percentage of people who have the money and intended to invest invest in classics will be wiped out during 2020 and their money inherited by generations who perhaps have less interest in old cars.
It's likely a significant percentage of people who already own classics will be wiped out, thus dumping many additional cars onto a suppressed, flooded marketplace.

It will make me dreadfully unhappy to be proved right so I really hope mercdan68 's one word prediction pans out. On the flip side of the coin, if I'm somewhere near right, it could result in dream cars coming back into the ambitions of mere mortals! If it was my £, I'd wait 6 months before jumping.

And yet after the last crisis there was some substantial capital movement into classic vehicles as other places to put your money became less attractive. Near zero or even negative interest rates make 'tangibles' better investments, much like gold.

I'd expect the high end of the classic and vintage market to go up, but we may see the bottom end fall out as people offload those vehicles in exchange for liquidity to fund emergencies and unemployment.

Mar 15, 2020 9:51:47 GMT @grumpynorthener said:

You need to stop worrying about what your classic / retro is worth and get out there and enjoy using it / restoring it / polishing it - which is far more enjoyable and in my book 'priceless' - leave the modern vehicle owner who has just blown £40k on a shiny new over hyped motor do the worrying about depreciation

Absolutely this. Market value != value.

[ballbagbagins]

This is a great point

may see the bottom end fall out as people offload those vehicles in exchange for liquidity to fund emergencies and unemployment.

If companies cut hours, layoff people or go under then people might have to part with their classic to keep their household afloat. This might not happen to everyone or even relatively soon, but if you don't have a decent sized savings pot then some may be forced to part with their beloved classic. My modern engine rebuild is definitely on hold now.

[ballbagbagins]

And, it's great to hear from grumpynorthener again.

[generallee]

I guess it doesn't matter to most of us in that we do it for the love of it, investing more time and money than our cars are worth in terms of market value.

But... The top end stuff has been snaffled up by investors for ages now, as is art, property and even wine as they look for somewhere to put their cash. The stock markets are teetering yet banks aren't offering interest. So a BDA escort, early 911 or gull wing Merc may still be a safe investment.

On a personal level, I'd have no problem if the market crashed. Imagine what us lot could get up to if loads of mint old cars were suddenly within our reach...