is the bubble due to burst?

Agree with all you say regarding the housing bubble however all that boiled back down to the government . and I agree that cars can get caught up in a bubble however one factor is the government is not going to fuse it. THe highest risk for a collector car bubble is when non enthusiasts are buying cars like stock purely to make a few bucks. I also do not know if we are at risk of that but it will likely be market wide if it happens. I know of a group of investors that bought over 100 cars of a different mark(an entire collection) purely for the idea of reselling the key being they are not dealers but wall street types this is the type of action that makes one worry of a bubble. I know the seller and he actually still has most of the cars until they are resold the buyers have never seen the cars, and they are showing up at this years auctions .

 

TBAKOWSKY states that most people born in the 90's have no interest... have you ever been to the Goodwood Revival meeting ? 147,000 people turn up every year to watch 1950 and 1960's sports cars race around the track . This is a family event with many generations turning up to watch the glory days of historic sports car racing . The audience grows every year with the younger generations learning about the Old Masters of automotive history. Your statement saying that the younger generation don't care is simply not true..

 

The same with le Mans Classic, al 2 years biger and biger, 1000 miglia, same...

Back to value of cars, also a big Point for me ist that 1000Miglia eligable cars, cars that ran Le Mans in period are climbing ang climbin with the Price then People want to go there, want to race and These cars are there tickets. I have an offer for a small FIAT 1400 that rans 1000Miglia, no 8V ore Zagato, a normal FIAT, the owner wants 200.000€ for it!

As BluGTS said, Goodwood, in spring Festival ofSpeed, more than 130t People, same in September, Revival, thats a big big Party with cars raing value in Millions per one race. I am sure These are NO Investors they do that.

Now the Targa Florio comes back as a big Event (organized by the MAC Group) like the Mille Miglia. Same happend with Targa cars ? See: Targa Florio Classic from the 9th to the 13th October 2013 Entrusted to MAC Group with multi-year agreement : Anamera

So what i want to say, all these Events, only here in europe are growing very fast and so many People want to be part of it with the right toy, and with some cars you have the Special ticket for it. sorry for my english ;-)

 

He can speak for himself, but my interpretation of his thought is that the current generation was able to live through the golden era of coachbuilding as a youth and are unique in their embrace of all things automotive. As a result, as years go by after their passing (say 20 years into the future) by the Atlantic and the 250 GTO will not be able to garner $40M in present day dollars. If only we could know......

 

I don't see how it is. The Dino is a great little car, but $350k great? I'm left scratching my head. Sure, the V12 models should command that amount and much more, no doubt about it. They are grand cars from a grand era. But that kind of money for a Dino just seems a little over the top.

Then again, what does $350k-$400k get you in the Ferrari world these days? A variety of new Ferrari's, if that interest you. In the Vintage world, a Daytona, a BBLM or 308 race car. So maybe in a way, the Dino is just finding it's natural level.

But IMO, $350k-$400k for a Dino feels like a bubble, whether it really is or not.

-F

 

Forgive me. My reading comprehension skills have apparently declined. Are you saying that Dinos are now worth the same as a Daytona? I get it about the early Enzo cars. I think there will always be enough New World Billionaires who will buy these cars for the same reason that they will buy a Picasso, i.e., because they want to be accepted by their peers.

But is the same going to hold true for the later Enzo cars? Granted, Dinos look cool as ****. But are they worth Daytona prices? Or if this keeps up, F40 prices?

Dale

 

You're correct on the factors that played a roll in the housing market debacle that led to the recension.
If investors are buying collector cars as investment vehicles how is that different than your mom and pops that buy stock based on minimal experience and information? Fine art is always bough by the end user? Mulit-family in in-fill areas of the country like NY, Chicago and San Francisco hasn't been targeted by hedge funds and small investors because they perceive this asset class to be as a safe heaven as it relates to all other classes of real estate? It's happening big time! So based on that the Dow, NASDAQ and the apartment investment sector of the real estate market are all in great danger in collapse due to a bubble? I mean the Dow is at 15k, fine are is flying high and the multi-family market is out of control. Or is it the old supply and demand effecting these major rises?

Geno

 

Tons of Dinos in the $160-$180K range that are non-F&C and are not in mint condition, but average driver quality. The best cars $275-$400K depending on the typical factors. I see no Daytonas in the $160-$160K range...

 

Look, yes. Buy and own is another thing.

A lot of people love to go to boat races. Less than 0.000002% would like to spend the money to own one.

People DO like to own things from their childhood or memories of the past. That's why you can buy a mint 1925 Buick for $15 grand. It's old and rare but no one really has a love for it anymore.

 

Mayor,

You're correct about the younger crowd these days, but maybe we were the same way
when young? For example, my 21 year old son knows what a Gullwing or GTO is because
I've taught him, however he and his friends are interested in Cobra's, Boss's and Z06
Corvettes from this era rather than mine. Unfortunate but true to this current generation.

 

There is a tremendous difference between going to a museum for just one afternoon, and buying a Picasso for your home.

Tbakowsky is spot on in regards to addressing the demographics that affect this market......and all markets for that matter.

To wit.......as someone seriously interested in a vintage Corvette, I have studied the market for the last 3 years and have come to the conclusion that if one is to buy something for "value retention" (notice that I did not say, nor will I mention, price appreciation) as well as future marketability (read : liquidity), the 1968-1972 double chrome bumper C3 is the car to get.

But why not consider the 1963-1967 C2, the purists cry.......???

Well, it is all due to demographics.....and the NCRS (or demographics and Pebble Beach, if talking about Ferrari's, etc). The people who own the C2's are all looking to cash out as they are often long retired, or planning to be. Yet those cars for sale, that number in the hundreds, sit for months and years at their ridiculious sky high prices, because all the owners have drank their NCRS supplied Kool-Aid. Anyone buying a C2 today is facing a thin market in the future and a huge capital loss. If these cars were as desireable as those who own them profess they are, they'd be trading fast and furious.....but they are not. There are no buyers at those prices.......yet for every one or two market topping sales that may occur in a calendar year (because statistically the "greater fool" is always out there), the talk of a fluid and dynamic market wails loud and proud over the masses still holding onto that pot of fool's gold which they dare not drive.

I've lived thru numerous asset bubbles (real estate X 2, stocks, cars, etc) and a couple of them were car huge bubbles.....the late 80's Ferrari boom and bust which occurred after Enzo's death ($150K 328's anyone.....LOL !!!)......and the mid 2000's muscle car bubble.........and each and every single time, the talk is the same.

And the bubble bursts.......once again.

 

Most kids are just like they were grown in a tank. You have to wait till they are past 30-35 and some of them stop going with the masses and start wanting things for what they are - and for themselves. That's where the Bimmers turn into crap and old classics start receiving appreciation. As a result we will have a strong minority that looks like it turned up from nothing! Be honest and you'll have to admit that it wasn't any different for the earlier generations.

 

The Bubble has already burst.

Look at BJ auctions. Car after car selling for much less that it cost to make/Resto/restore
them.

There are many cars you can buy today for less than the owner paid to restore it.

At the HIGH end the market is strong and will likely get stronger. There is and has been an interesting market shift to some cars. In the early 70's 427 Cobra's traded for 2X 275 GTB's. Today that has reversed.

I've never bought a car as an investment but I still think if you buy a great car over time it's monetary value will hold but more importantly you can enjoy it.

Comparing even 250 GTO's to Art remains silly. There are paintings that sold in the 60's for $100 that recently traded for 100MM USD.

Today there are 250 GTO's being offered for about 40MM USD. I personally think that market is toppy but I thought it was at 20 and 30.

 

I think in general there is some truth to the older cars not being as attractive to next generations that didn't experience them in their youth, but there are a couple factors that make this less likely to happen with Ferraris. First, Ferrari is almost indisputably the premier car brand (like Picasso or Van Gogh in art), so everybody knows them and there is passion around the racing image (even if they don't know the actual racing history). The second is that Ferrari remains the premier brand in high performance cars and racing, so it's quite natural for younger enthusiasts to be interested in the roots of the brand even if they only grew up with the later models. There is also the great driving experience of the vintage Ferraris that keeps them desirable versus other collectible car brands.

 

Two things surprised me last year, with significant impact for the future of the car market.

1 - The sale of so many big $ cars, semi - publically. At least 3 GTo's, the Le Mans winning 250TR, 917K & Aston DBR1 amongst many others.

2 - That prices for the stellar cars were continually strong, if not rising.

My personal belief is that we are in for a market where there will be two clear asset classes, the first affecting the best of the best, 250 GTo's, Bugatti's etc. where prices will be anywhere from strong to very strong. I personally believe that the economic crises has created the biggest shift of wealth from the state to the billionaires, and they are getting wealthier while the rest simply arent. The billionaires are able to look at most other asset classes and see that while they can get 4 - 5% investing in Government bonds or whatever OR they can by a Fermasugatti Speciale and drive it, perhaps making a bit or losing a bit but getting a lot of pleasure, the sort of pleasure you cant get from looking at a number on a computer. What I see causing volativity is that if other forms of investment recover a lot of the money being invested may come back out. This class may see a lot of volativity as well since there are so few players with the funds and the knowledge that allow these purchases.

The second class is all of the rest, which appears to have been sucked up on an upward curve of value, by the big guns, these cars will eventually suffer the fate of any bubble. There will be a crash the question will be of what magnitude. It will be 1991/92 all over again.

 

I would like to make 10-12% on my money without much risk. If I can count on that, I may be interested in an overpriced California Spider.

 

The billionaires are able to look at most other asset classes and see that while they can get 4 - 5% investing in Government bonds or whatever OR they can by a Fermasugatti Speciale and drive it, perhaps making a bit or losing a bit but getting a lot of pleasure, the sort of pleasure you cant get from looking at a number on a computer. What I see causing volativity is that if other forms of investment recover .....

I believe that there is a much bigger risk of a significant correction/fall if buyers truly think these relatively illiquid items can only lose smalls vs risks arising from other forms of investment recovering.

 

You know, I have been hearing this for years, e.g., Duesenbergs. But it never seems to happen. Maybe this is because automobiles are still relatively young (100 years or so) so there has not been enough time for successive generations to lose interest. Or, in what I'm guessing is the real reason, as the world's population has grown (we are now around 7 billion) and gotten wealthier, there are more and more people in absolute numbers chasing the same number of cars.

I have always thought that the market values of these "second-class enthusiast" cars are based on their relative value. GTCs, for example, trade at 2/3s of a Daytona. Daytonas are 1/3 of a 275 and so on. Thus, when a Dino starts fetching Daytona money, you have to wonder if the Dino is overvalued or is the Daytona undervalued?

However, reading some of these posts make me wonder if we are not seeing a collection phase? That is, a collector might pay up for a Dino because he already has a Daytona.

Your thoughts?

Dale

 

Jim-- are you saying that the price increases in these mid-tier 1960s Ferraris (275s, 330s and 365s, Dinos, etc) are over, or have even started to head down? Any data to support this?

 

How about a Porsche Speedster as a comparison? Roughly the same current market value, production numbers, etc. More special, rare, or 'Fun' than the Dino? Is the Speedster a sustainable situation?

 

I think 275's will hold but see 330's 365's and Dino's as being toppy at the present time.

Just what I think.

No more, no less.

 

For me also all unrestored, First paint and well documentated Cars are the Future. I am always Looking for original 911 in this condition, f model! Put a Price on a Car like this. There is no Price, you have to Pay what the seller wants. If someone knowes a care like this please offer, send me a pm, thanks

 

Jim is right,

275 long nose alloy car had been consigned to Gooding for Amelia (yellow color) with a reserve of $2MM. Wow!

Geno

 

This thread is depressing.

I've never, ever purchased a car because I thought it was a good investment. Honestly, I expected to lose money on each and every one. The classic & vintage cars I have purchased were bought with my heart, not my brain. I bought them purely because they moved and inspired me, not because they diversified my portfolio. I purchased what I could comfortably afford, seemed to be reasonable value and I thought I would get the most enjoyment from. I bought them to drive hard and lovingly maintain. I got to know each and every wonderful little nuance. I never worried about bubbles, speculators, who's buying and selling, who will care about the cars in the future... All that mattered was me and the car.

Looking back, this has served me extremely well over the last 30 years. I plan to keep on doing exactly the same.

Buy another Dino for 400, I think not.
A carburated Boxer for 100, in a second.

 

Ten years ago, this would have been, what, a $400K car?

Dale