Just an idea: Classics that won't depreciate

http://grassrootsmotorsports.com/reader-rides/2596/

Good ones can be had for 15 grand. Most parts are still available and a lot of re-pro stuff is being made. Not going to depreciate anytime soon.

alfadriver wrote: Honestly, and I'm being very brutal here, if you have not done your homework, and found the cars that are not depreciating, you should NOT invest. Cars are not an investment, they are a tool and a toy. The fact that one can take advantage of their cost ends up being secondary. IMHO, if all you are looking for is financial, you will probably lose. There are a TON of cars out there in the $15k range that do not lose or increase value. Virtually all of them are becuase someone has an emotional attachement to the car. Do your homework, just like stock investing.

Agreed. I would also suggest if you are in the position of spending 15K on a speculative investment, there might be better investment "vehicles" out there to choose from than, say, vehicles.

Depending on your age, they can also be a nuisance and a burden on your non car loving survivors. A lot of the press regarding the wisdom of investing in classic cars is to me a bit of patting oneself on the back anyway. We're all suckers for cars at the end of the day. I see the same dialogue surrounding gun purchases.

Newer cars have more depreciation. Older cars have more repairs and maintenance. Choose your poison and certainly don't expect to come out with an equal sized wallet. It can be done but I wouldn't count on it.

Nothing under $1,000 depreciates down here as long as the a/c works and it drives.

I usually buy under $1,000 drive it until I'm bored and sell for $1500 or so.

Cheap cars for life!

I'd second the "timing" comment. Getting deals is always about timing. The trick is having the available funds, patience and decisiveness to move at the right moment. If you start the clock with a deal, the chances of getting out above water go up considerably. If you pay market value, not as much.

I think you can definately do what you are describing, so long as the car is a low-milage, garaged playtoy. In fact, I think that a lot of the people on this board do exactly that.

The problem, as with any investment, is that past performance don't indicate future returns. So you may buy into something that has "always" held it's value, and suddenly it goes down. Or you may buy something that all the experts say will go up in value that never does.

I have an old Road & Track around here somewhere that says MGB-GT's will be worth $25,000 by the year 2000. Well here it is 2010, and my stupid GT still isn't worth anything. In the meanwhile, look at what has happened to the prices of early F-bodies and other muscle cars. Who would have known?

1994-96 Impala SS. Really.

A friend got a very clean Grand National for good deal. Put several hundred dollars in wax. He had someone offer him a good deal more for it.

m4ff3w wrote: Nothing under $1,000 depreciates down here as long as the a/c works and it drives. I usually buy under $1,000 drive it until I'm bored and sell for $1500 or so. Cheap cars for life!

That's my theory too. As a 1G CRX slut, I will say that I've never seen them go so cheap as they have been lately, and I don't think I'll ever see them this cheap again. If I had a stack of cash and a barn, I'd be buying, covering, and parking. Sadly, I think the thing that's scaring me off from buying more (aside from the lack of disposable dough) is the same thing keeping the prices low: Parts are drying up. My "huge stack" in the basement has dwindled down to about 1/4 of the size it once was, and I'm pretty much at the point where I can't afford to be giving stuff away anymore.

At the risk of sounding like a broken record... FD :) I bought mine in good running order for $8500 four years ago and it still has a KBB "fair" value of $10k. It's getting to the point where they're holding value against performance cars that are 10 years newer (including RX8s, WRXes, even Boxsters). Hopefully they'll stay fairly depreciation-proof in the coming years since it seems like they already hit bottom.

Being an educated consumer who's handy is a HUGE help. The seller with the non-runner who doesn't know it's just the drellspreel-pawlwheezie sprag clutch bracket - and ~all~ the 1988s did that...can result in a very good buy.

But above all - the money is made on the front end. A good buy is a known entity and a sure bet. Selling well is an utter crap shoot.

e36 M3s are about bottomed on their depreciation curve and the sh1tty ones are bringing down the rest of the field. e30s in general are getting expensive where I live. M5s are cheap, relatively; particularly e34s.

I have only made money on one car deal in my life. I once bought a 68 Impala for $100. Filled it up with gas and drove it home. Switched the carbs between it and my 68 Camaro then sold it for $300 with the same gas in it. Needless to say this was a long time ago.

Other than that I'm always on the loosing end. It's just the way my luck runs.

Armitage wrote: At the risk of sounding like a broken record... FD :) I bought mine in good running order for $8500 four years ago and it still has a KBB "fair" value of $10k. It's getting to the point where they're holding value against performance cars that are 10 years newer (including RX8s, WRXes, even Boxsters). Hopefully they'll stay fairly depreciation-proof in the coming years since it seems like they already hit bottom.

I agree. The level of factory performance coupled with the hop-up potential, sexy looks, and limited production makes this car as close as you can come to a sure bet. The trick is getting an unmolested example at a fair price.

I may be biased, however.

In reply to 1988RedT2:

Just as long as the engine never gives out, or the turbos, or the computer junk...

My parents bought a '67 350 hp 327 Corvette coupe in 2002 for 20K and it's now worth 60-65K. It's insured for agreed upon value, and still better than pretty much any mutual fund through that time period. That ship has sailed, but there will be others. I had a thread about this, but I can't find it. I was settled on an Esprit, a NSX or a 911 SC/Carrera or 993.

The answer is yes. This works especially well for people like you who are proposing automotive serial divorces. Works with any classic/collectible car. The trick is finding the right seller/car combination. For this reason, the hunt becomes the hobby.

You are looking for a "Cool" car that was "Frame-up"restored five to ten years ago. You need to have the skill to asses if it was well done. You do not want to be doing anything but a tune-up and wax job on this thing if you expect to come out cheap. Rust is the Gonorrhea of this hook-up, trust me.

The car is on the block because the owner has moved on. The truth is that after many an obsessive restoration, the reality of driving and maintaining a classic vehicle can be a let-down. Maybe Golf took over. Don't matter cause the car is an appendix in the garage and must go.

You don't have to steal the car. Since it is not going to depreciate much if at all, it don't really matter. Drive a good bargain and know that you paid mid pack.

And here is the key to being a classic auto slut:

On the way out of the PO's driveway, stick the for sale sign on the car. You are NOT in this for the emotional attachment. You have a viable product with a well defined market and time is on your side. You know what it is worth cause you just paid it. If you can figure how to add value with little to no investment, then so much the better. How you market the car is up to your. At this point, between hanging out with potential buyers, you are doing your research on the next interesting car you might want to drive.

Don't really expect to make any $$$ on this. The divorce fees; taxes, tittle fees , advertising and such pretty much eat that up. But you can pretty much break even and drive a string of cool cars.

I say Corvettes tend to do well in regards to what you intend to do with your cars...a particular one in my mind is a C4 Grand Sport...you know the blue ones with black wheels and striped fenders, I've seen white ones like that but don't know if they are the real deal...Corvettes seem to always hold their value for some reason.

skeze wrote: I say Corvettes tend to do well in regards to what you intend to do with your cars...a particular one in my mind is a C4 Grand Sport...you know the blue ones with black wheels and striped fenders, I've seen white ones like that but don't know if they are the real deal...Corvettes seem to always hold their value for some reason.

This is true, although the potential of the C4s is dubious. A good Grand Sport or ZR1 C4 would probably make a great investment and awesome driver.

I'd actually go for a ZR1 over a Grand Sport, but that's mostly because I find the colour scheme of the Grand Sport somewhat revolting.

It is possible to use classic/collectible cars as an investment. But you usually have to put in a healthy amount of $$$ to break even or make money. Meaning cars that have value. Like Aston Martin, certain Jags, Ferraris, Bugattis, etc. There are lots of people making a living or paying for their hobby/addiction this way. The easiest is American Muscle cars and/or classics (like 55-57 Chevys, early Mustangs, 2-door Novas and any early muscle Mopar), especially if you're handy with tools and don't count your manhours into the investment. Now most of our cars tend to go inexpensive (read: cheap) in the first place so they don't really gain much value. Yeah used `Vettes seem to hold value pretty well.
I'd go over to the classic side and ask their Auction Editor, Andy Reid input.

ptmeyer84 wrote: I came up with an idea the other day and I want you guys to tell me if I am crazy or not. Would it be feasible to "invest" $15k or so into a car of any vintage and turn it over in a couple of years and at least break even? My thought is to have a fun car that my wife and I would enjoy, but have the option to change it up and try something different every few years. Say go with a TR6 for a couple of years then trade and get a Cadillac Coupe deVille, and so on. Obviously, the cars would be well sorted from the get go, so not much work outside of regular maintenance would go into them. Eh, whatever, I was bored and was curious as to what the esteemed minds here at GRM thought.

I think most of the replies are confused about your use of the term "Invest". Or I am.

From what I understand, you are trying to own and drive a string of classic cars for as little cash-flow as possible. That is quite possible and a reason in itself to be in the hobby.

Car specific replies are irrelevant since it can be done with any collector car that you fancy, and you have already declared yourself a cad in that respect.

If you hope to make any reasonable (as in positive) return on the "Investment", then forget about it. Stick the money in the bank.

Well, on the higher end, 550 Maranellos have just about hit bottom and offer tremendous value. Reliable, reasonable service costs, Pininfarina styling, front engined V12 , a gated shifter and excellent build quality. Remember, you heard it here first.

I try to buy low mileage unmodified cars that were either the cool car to have in high school (and modify) or idolized by high schoolers. I try to buy them just before that generation of high schoolers reaches their prime years of disposable income and desire to play with cars (35-50 YO). This way I'm buying the cars at the bottom of their value cycle and they start gaining value whch usually outpaces the depreciation of wear from use.

Right now I'd look for cars from the mid 80's through early 90's. Think Monte Carlo SS, Grand National, Mustang GT, Trans AM GTA, Turbo Supra, Air cooled 85 & up 911, Lotus Esprit.

I've been doing it for a long time, and kept a few too many along the way, but very, very rarely lost on a car. Currently have 66 Mustang, 67 RS SS Conv Camaro, 70 Trans Am clone, 70 Wildcat 455, 81 Malibu, 86 euro widebody 911 cabrio. All could easily be sold for more than I paid and spent on them because I bought them at the low point in their value cycle just before their prices started to increase.

Timing is critical I think. Buy too late, and the value goes down on many cars from an "era", stay flat, or may only slowly increase in value. See average selling prices of 50's cars now that the highschoolers from that era are getting too old to be interested in playing with cars. Prices of 50's cars have taken huge hit during the down market and I doubt they'll recover on many models becase the prime buying group will be too old and won't want them when the economy rebounds.

Although I still own some I wouldn't (and don't) buy cars before 80 anymore. That is, if you're also considering the financial consequences of selling 5-7 years out.

Phew! Lots of responses. I guess not many picked up on the quotations around the term invest. I know that I will lose money and my thought process was not to gain money but to drive as many cool cars as possible without losing too much with each purchase. Actually, what started this silly idea was all those damn beautiful TR6s that frequently come up on BAT, especially the most recent blue one. I swear, that site will be the death of me.

My thought process for the rest of my future fleet would be to have one versatile, and loved family vehicle that would last for 10 years or so. For example, I don't want to go out and buy a newish SUV every couple of years and lose my ass on depreciation. I would rather direct my automotive ADD towards something that would be fun to drive. Also, I want to have a track rat of some sort and some cheap ass truck to haul our crap.

Anyway, great responses, you remind me why I love this mag, site, and forum! Keep the recommendations coming, BTW!

I have sold three vehicles in my life that I sold for more than I paid for them. An 89 CRX Si, 88 Mr2 SC, and a 93 Jeep Cherokee. Like others have said it is about timing. I got a great deal on the initial purchases. Granted these all cost me less than $2500...