I just came across this in an article in one of our Aussie newspapers this evening:
Looking to splurge on an emotional investment that will quadruple your money in 10 years? Forget watches, stamp collections or even fine art. Buy a classic car.
Not just any old banger will do, though. According to the annual Knight Frank Wealth Report released this week, a ”truly investment grade car” bought in 2002 would have appreciated by up to 395 per cent over the past 10 years.
That makes cars easily the best ”passion” investment you can make, well and truly outperforming popular luxury items such as fine art (199 per cent), jewellery (140 per cent) and watches (76 per cent).
The most sought-after cars tend to be Ferraris, with a 1957 Ferrari 250 Testa Rossa holding the world record of $US16.39 million ($A16.02 million). Classic Aston Martins, Mercedes-Benzes and some pre-war Bugattis, Alfa Romeos and Rolls-Royces can also fetch prices in the millions.
Going from that list, it seems the type of car they’re talking about is already out of my reach. It looks like you have to spend serious money before you can make even a little money back. There must be some makes and models sitting just under that imaginary line, cars that will be regarded as classics in the next decade. I have to confess that I’ve had some recent thoughts about spending more than I’d ever usually consider on something exotic. I’m pretty sure the car I’m considering would appreciate in value over time, but it might take a long time for it to really be in demand.
It’s a daunting proposition because exotics, even the ‘affordable’ ones, tend to be older. That means they’re possibly going to be harder to maintain, harder to get parts for (without selling a kidney, at least). We’ve all seen the Mid-Engine Challenge on Top Gear. They spell it out pretty well. “Yes, you can buy a mid-engined supercar for under £10,000 but for heaven’s sake, don’t.”
But what if you spend a little more than that…….?
Have any of you ever had experience with classic car investment? Ever made any money on a classic car? It’s obviously possible, but is it attainable if you’re not super-rich to begin with?