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Why are Classic Cars so expensive?


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Having an idle browse through eBay as you do, the prices of 80’s and early 90’s cars are nuts. A very crusty looking ‘88 Celica... £3k. A tired looking early 90’s Supra £29k...

Given we’re entering into probably the worst recession in living memory, who is paying mad money for these cars? I can about remember maybe 20 years ago a Classic was very much a grass roots hobby, perhaps a £500 Cortina Mk4 or a tidy Oxford for £7-800. It’s gone mad money now!

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There is a world of difference between asking and selling prices and there seem to be many, many dreamers chasing the Mike Brewer pot of gold.

But the real value in an old car is the huge amount of skill, time and money required to restore and maintain one in top order. Just consider the scale of investment in the Granada Coupe restoration we have been following here. Must add up to much  more than buying something equivalent and new.

 

 

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Isn't this just the natural way of things though?

Back when I passed my test in 2003, I was picking up immaculate Maestros and Montegos from £300 upwards. £500 was an expensive example. The best part of twenty years later and all the nice ones have four figures in the price, and the £300 ones aren't worth buying. All the cheap British Leyland stuff is now the last of the line MGRover era cars from the turn of the century.

Most of the 1980s and 1990s cars I do still own, I would struggle to either 1) find at all these days, or 2) afford.

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19 minutes ago, dollywobbler said:

rich through house price rises

You only get rich by selling! Even then most move up in the chain and have the same/increase their mortgage. 

However there are plenty of older people with nostalgia who bought houses when they're cheap and have long paid it off. So a lot more disposable income. 

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8 minutes ago, Austin-Rover said:

All the cheap British Leyland stuff is now the last of the line MGRover era cars from the turn of the century.

This! You can still pick up Rover 25/45/75 for under a grand still. Give it another decade and they'll be increasing like older BL chod. 

Let's also not forget the scrappage scheme that took out a lot of the 80/90s cars that were more likely well looked after. Certainly those that could afford new cars after a crash, were more likely to have budgets to look after their previous car. 

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7 minutes ago, SiC said:

You only get rich by selling! Even then most move up in the chain and have the same/increase their mortgage. 

However there are plenty of older people with nostalgia who bought houses when they're cheap and have long paid it off. So a lot more disposable income. 

You can also be rich because you paid your mortgage off years ago!

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These are cars that in a decades time people will be saying I can't believe you could get these so cheap. All not classics now but they will almost certainly be ones and ones that are coverted.

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https://www.autotrader.co.uk/car-details/202011075889839

 

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https://www.autotrader.co.uk/car-details/202009033286444

 

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https://www.autotrader.co.uk/car-details/202010315645604

 

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https://www.autotrader.co.uk/car-details/202010134943508

 

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I think some of the white room places like KGF who sell low mileage nicely prepared stuff for high numbers makes people with higher mile not quite so nice stuff think they're worth more than they are. Some of the prices on carandclassic are laughable.

There's still some cool 90's stuff out there for not much money (mx-5. puma, MG ZS). Not much use if you like something with twin strombergs through,

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3 minutes ago, Six-cylinder said:

Flippers buy this week, sell next week.

I was thinking of people who buy then think if they hold on to them for a couple of years the value will rise.

Flippers sometimes end up holding onto a car because nobody will pay their price. Ask any antique dealer.....

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11 minutes ago, Tadhg Tiogar said:

Flippers sometimes end up holding onto a car because nobody will pay their price. Ask any antique dealer.....

There are a couple of cars I have bought that I thought were under valued to sell on again in a year or two when the market realised that. In 2011 I bought a 1972 MGB GT as I could not believe they were only worth a 1/5 of the roadster price. Then 7 years ago I bought a 1996 BMW M3 Evo convertible because E36 M cars looks so cheap compared to other M cars. I was  right they have both substantially grown in value, trouble is I like them and still have them both!

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I have noticed that prices seem to be dropping. It depends what you want. An old car will cost more to run, will need maintaining, will possibly need welding and painting. It wasn't so many years ago you couldn't give an Allegro or  Marina away. Now look at the price of them. Pick something you like, find a good one and look after it. Lots of folk here will have their own views on what is good or bad. Chose what you like and enjoy it.

 

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58 minutes ago, Cavcraft said:

It's a very false market at the moment, no matter what prices some people might ask for their cars.

When I (seriously) enquired about prospects for any... YES any... offer for ToMM© c/w 12m MOT.... I got a jaunty response "A barm cake".

I have often looked at the, frankly, barmy 'asking £****' mint, low miles Carina II on fleebay (not seen one @WhiteRoom)....

All the shuffling round of these last 4weeks proves one thing... Keep it in the family ;)

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3 hours ago, Six-cylinder said:

Are there still people who believe classic car prices will rise more and they will make a profit?

I don't understand how to make money on cars. If I buy one & park it up for ten years it will likely be rotten & no longer run. Unless I rent a dry garage to keep it in & have it MOT'd and or serviced/MOT'd regularly - & I'd have to tax/insure it to be able to do that. Rent + MOT + service + tax + insurance + regular fresh petrol = I've spent a shit load, that I'd have proably been better off bunging into a regular saving product - as chances are no-one will still want a Mazda 121 bubble or similar 'investment' in 2030.

 

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A lot of the drop in prices is due to the time of year.  Nothing is less appealing than dealing with a classic's 'character' when it's pissing down and pitch black.

The June sale is when people can imagine the wind in their hair/ sunny trips to the seaside in Dad's pride & joy, etc.

No point having money on the bank at the moment... you may as well re-live your youth with a Stag/ XR3i et al and almost certainly get your money back in a few years, if not make some.

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I don’t know rose tinted glasses and all that, what seemed like a great time in 1988 in the sun sat in your dads Granada Ghia cruising along listening to Paul Young ‘No Parlez’ transcribes to 32 years later cashing your pension in at 55 and laying at a funny angle in your 50’s welding up the sills. 

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Yeah the reality never lives up to the hype. 

The thing is, quite often we're talking £50-£60,000 cars in a lot of cases though- most of which are bought as investments, trailered to a heated storage site and not looked at again until it's time to liquidate some assets.

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2 hours ago, Six-cylinder said:

Flippers buy this week, sell next week.

I was thinking of people who buy then think if they hold on to them for a couple of years the value will rise.

I paid 1500 quid for a 1996/7 mx5 in 2009.  My wife told me it would hold its value.  Like fuck. It's worth less than we paid for it 11 years later.  Maybe if we hadn't bought a poverty spec Monza with only 92 bhp. 

 

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The only way to do it is to buy something you want to own, if it goes up in value, great, if not then you have had the pleasure of owning it. My Capri is probably the only car I have had that I could make serious money on, I bought it for £600 6 years ago, total spend around £1200 and 6 years of graft. Probably worth £6-8k now. But I have no intention of selling as there isn’t anything cheap to buy anymore that is of interest.

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Most of it is the basic supply and demand. If there are very few of a "desirable" car and enough people want that particular one, prices will rise. As with anything, the best ones tend to go for the highest prices. To a degree this will drag the prices of the not so good ones up.

Some have bought the car of their dreams and are hanging on to it, so it won't be on the market any time soon. Add in speculators and suddenly there is a bubble waiting to burst.

There will be quite a few that get handed around the trade in a pass the parcel manner. I can remember the classic car bubble bursting in the 1980s where it took years for things to get back to previous "values".

A lot of the stuff "restored" then was not done very well and now needs it again.

Not sure what people getting rich through rising house prices has to do with it. Not everyone who did has any interest in cars, not everyone did well out of price rises or did I imagine the last two crashes in the 1980s and 2007, as has been said it's only profit when you sell and buy something cheaper. Perhaps the ones spending are the younger generation who have inherited the benefits of the older generation.

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21 minutes ago, anonymous user said:

Most of it is the basic supply and demand. If there are very few of a "desirable" car and enough people want that particular one, prices will rise. As with anything, the best ones tend to go for the highest prices. To a degree this will drag the prices of the not so good ones up.

Some have bought the car of their dreams and are hanging on to it, so it won't be on the market any time soon. Add in speculators and suddenly there is a bubble waiting to burst.

There will be quite a few that get handed around the trade in a pass the parcel manner. I can remember the classic car bubble bursting in the 1980s where it took years for things to get back to previous "values".

A lot of the stuff "restored" then was not done very well and now needs it again.

Not sure what people getting rich through rising house prices has to do with it. Not everyone who did has any interest in cars, not everyone did well out of price rises or did I imagine the last two crashes in the 1980s and 2007, as has been said it's only profit when you sell and buy something cheaper. Perhaps the ones spending are the younger generation who have inherited the benefits of the older generation.

Seeing how hard it is to get a mortgage for first time buyers and how most of the under 30s I know have 40 year mortgages just to get on the property ladder, I doubt it’s youngsters pushing the prices up. 

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1 hour ago, meggersdog said:

Watching ACA classic auction live on ebay at the moment.Loads of non runners, part restos and barn finds and prices seem to have dropped from the madness that was the June auction.

Just tuned in when you said that. Quite an interesting watch on prices. 

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