It’s a question that Classic Car Buyers ask us quite often, here’s our view….
Cars naturally depreciate as we all know from new, they hit a point at around 15 years old where they plateau and drop less significantly but at what point do they start to go back up and do all cars do this? Generally speaking we often start to see an increase in car values again around 20 years and then certainly at 25 years old when they become “technically a classic car“. Principally driving this initial price rise is rarity. As time goes on cars gets scrapped and a car becomes rarer and much like newer vehicles there is a bum for every seat and this is the same for classic cars. It doesn’t automatically make them worth £50000 but on an investment level they can make you money. Here’s an example:
We had a 1991 Nissan Micra at the time it was about 27 years old, 50000 miles approximately and clean. These cars you would be buying 10 years earlier maybe for a couple of hundred pounds. This one we sold for £1700. So on an investment level £200 invested to make £1700. Those kind of percentages are very hard to achieve but it’s over a ten year period for £150 a year for ten years. To be fair you won’t make that kind of money in the bank. Clearly however you do need a lot of space to hold enough vehicles to make any real money from them or go for higher asset value vehicles to achieve what bigger gains. Those who own E Type Jaguar’s today are laughing as an example.
So the answer is yes you can invest in classic cars and they can make you money, of course factors like how much work/prep you do on them play a key role in the figures too. Certain trends also kick for good investments. Within the American car scene things like 60’s Mustangs are making good money, buying a project and restoring it can make you good money in the long run. In terms of investment potential we’re pitching 80’s cars currently as a good shout. You can still buy 1980’s muscle cars for sub £10000 and these will go up in value.
There is of course a philosophical investment too. That investment is in yourself and the hobby. There is an enormous amount of enjoyment to be had even at the most stressful times but the feeling of solving a problem is incredibly satisfying for the classic car owner!
