Investors’ Paradise - The star of the show isn't what you think, by Jonathan Michaels
Ten years removed from the chill of the frozen economy, investment strategies are beginning to become clear. Rare watches have appreciated 65 percent; fine art has appreciated 130 percent; and precious jewels 147 percent. The Dow Jones has yielded an impressive 215 percent return. However, these returns pale in comparison to the 404 percent return the collector car market has achieved during this same time period.
If there is any question on this point, consider the Ferrari 250 GTO. In 1962, when the car first was first introduced, it had strike price of $6,000. By 2004, GTOs were trading at $10 million.
Six years later - at the height of the recession - the Italian machines were crossing the block at $26 million. If that sounds incredulous, consider that by 2014 GTOs had climbed to $38 million, and just earlier this year, a "Gran Turismo Omologata" (the full name of the GTO) sold for an eye-popping $70 million.
If the Ferrari 250 GTO sounds like an anomaly, it is not. In 2013, RM Auctions sold a Ferrari FSO for $800,000. In 2017, the auction house sold essentially the same car for $3.1 million
And if Ferraris have stolen the show, Porsches have taken the whole darn auditorium. In the last 10 years, classic Porsches have increased an astonishing 683 percent.
What is particularly significant about this is that, unlike Ferraris which have become stratospheric in their pricing, classic Porches are still relatively affordable. What is particularly interesting is the resiliency the market has had through challenging times.
Take for instance the 1958 Ferrari California, the car made famous as the Ferris Bueller car that suffered a fateful ending. In 2005, the average price was $1.5 million.
By 2015, 10 years later, the average price had climbed to $14 million, an 850 percent increase – and this is through the recession.
In fact, according to WMG Advisors, collector cars are the only asset class that that actually rose in 2008, when all other assets were in a freefall.
If the retail side of the automotive industry has seen a return of confident buyers, the classic car industry has exploded with enthusiasm. With their million-dollar price tags, classic cars attract financial moguls who tend to be smart with their dollars. For those with the industry specific knowhow, fortunes are there to be made in a New York minute in an industry that is bristling with hyperactivity.
Jonathan Michaels is the founding member of MLG Automotive Law, APLC, which specializes in representing clients in the automotive industry. https://mlgaplc.com/
If you do an internet search for ‘auto pre-purchase inspection’ almost certainly the first Sponsored listing will be Lemon Squad. Lemon Squad has great marketing! Dig a little deeper and search for Lemon Squad reviews and you might decide to keep searching. Whichever auto pre-purchase inspection company grabs your attention, before you hire them, do your due-diligence by reading through all the good, the bad and the ugly reviews online.
In which state should you register your collector car?
A great majority of the registrations for collector cars are split between three states:
South Dakota, Arizona, and Montana.
It can be a little confusing to know which one to choose , so here's a breakdown of each state to give you an idea of the one that’s right for you.
If you are looking for a car appraisal near you, and you are in South East Florida, you've found us!
Getting a car appraisal before you buy, sell, or trade a car helps you get a good idea of the vehicle’s value and puts you in a better-informed position to negotiate. Several factors can affect a car’s value, such as your location and what kind of buyer you’re selling to (if you’re selling). Where you go to get your car appraisal could also affect the estimate you receive. Online guides, lenders, car dealers and professional appraisers can all offer car appraisals.
When it comes to defining collector vehicles, apparently it's different strokes for different folks. Miura, Pinto, Veyron, Yugo, Agera, Trabant may indeed all qualify!
What's the most uncollectible vehicle you have ever owned, that now is considered a collector? Regardless, Auto Appraisal Network of South Florida appraises them all!
After being hit by a tow truck whose driver admitted to texting and driving, then dealing with the insurance company and feeling he was being short changed thru the whole process - a $36,187 settlement offer, Luis contacted Auto Appraisal Network for a Prior-to-Loss Fair Market Value Appraisal. Result? $41,705 settlement. That's $5,518 more! If your insurance company is delaying, denying or underpaying, call/text 786-853-0711
This article is actually about selling a classic car online, but every seller needs a buyer! If you are buying online, and cannot get up close and personal to kick the tires, be sure to get a pre-purchase inspection from a local Auto Appraiser. In South Florida, we can help!
When buying an older car, or one with a rebuilt or 'branded' title, most financing companies will request an independent Fair Market Value appraisal of the vehicle before approving your loan. Recently we've appraised two newer sports coupes with rebuilt titles in South Florida, a 2016 Jaguar F-Type and a 2018 Nissan GTR, and both loans were approved!
Whether you are buying your first collector car, adding one to you collection, or purchasing the whole collection, we can help with a pre-purchase inspection (PPI) and Fair Market Value appraisal in South Florida.