- Image – From Southeby’s Catalogue for their annual Monterey sale which is due to take place between the 18th and 20th of August in California
You may have been considering a range of investments as a way to safeguard your finances in these uncertain times – stocks, property, bonds or commodities. But if you’re looking for an investment that is both safe and has the potential for healthy returns, then you should consider classic cars. Despite the current economic downturn and high fuel prices, classic cars continue to be in demand and are fetching ever-higher prices at auction. So if you’re looking for a sound investment with the potential for capital appreciation, a classic car may be just what you’re looking for.
The collectables market, in general, seems to be faring well in this uncertain economy; it’s not just classic cars. Prices of luxury watches, handbags and even Star Wars collectables have been performing well.
Several cars sold for six-figure sums at Bonhams’ Goodwood Festival of Speed sale at the end of June, including some pretty tasty classics. A 1938 Jaguar, 31/2 Litre Roadster, saw the hammer fall at £425,500, including premium. One of just Seventy ever made, a 1962 Aston Martin DB4 Series IV Convertible sold for £588,440, and a 1973 Dino 246 GTS also did very well, reaching £316,666, including premium.
Bonham’s followed the success of the Goodwood sale with its first sale at the Gstaad Palace hotel in the Swiss Alps in 14 years, where they successfully sold 89% of the lots totalling £6.4m. The star of this sale was a rare 1991 Ferrari F40, which fetched around £1.7m.
It’s not just prestige marques fetching high prices either. Last month, a prototype RS3100 Ford Capri from 1972 sold for £74,250 – setting a new record for the model. The seller of this car bought it from Ford back in 1975 for £1,500 (that’s around £21,000 in today’s money), demonstrating the appreciation in its value in fifty years.
Back in May, we reported the record-breaking sale of an Ultra-Rare Mercedes 300 SLR, demonstrating the appetite for rare and desirable collectors classics. The hammer fell at a record-breaking 135m Euros smashing the previous record holder, a Ferrari 250 GTO, which sold for €45 million off of the top spot.
This insatiable appetite for collectable cars has also meant that collectors are finding it harder than ever to bag a bargain. In the past, high-end sports cars have depreciated from the moment they were driven off the forecourt. This depreciation continued for years, sometimes even decades, before the curve began to rise again as interest in them picked up during their classic years. This doesn’t seem to be the case anymore. The depreciation curve has become shallower over the last five years or so, meaning there are fewer bargains to be had for serious car investors.
A true test of the market will be Southeby’s annual Monterey sale which is due to take place between the 18th and 20th of August in California. There are a number of cars valued in the millions of dollars featuring in this sale, including a 1955 Ferrari 410 Sport Spider by Scaglietti with a valuation of $25,000,000 – $30,000,000, a 1938 Talbot-Lago T150-C SS Teardrop Coupe by Figoni et Falaschi estimated between $9,000,000 – $11,000,000, and a 1924 Hispano-Suiza H6C “Tulipwood” Torpedo by Nieuport-Astra with an estimate of $8,000,000 – $12,000,000.
Of course, classic cars have always been a solid investment, and it seems that in these turbulent economic times, they are proving to be a safe haven for many investors for now. So if you’re thinking about investing in a classic car, now may be the time to do it.