Investing in Classic Cars

Investing in Classic Cars

If you’ve soaked up the infectious enthusiasm pervading the classic car scene, then you’ve probably also heard the traditional mantra: pick the car you love and make investment potential a secondary issue.

But there’s no reason why classic car ownership can’t give you both pleasure and a golden nest egg. They key is to pick shrewdly, and to be well versed in recent motoring history so you can spot the motoring greats just about to start zooming out of the depreciation bell curve.

For the uninformed, the investment boat often sails before they can even get down to the quayside, let alone embark on the ship of fortune. But you need to take the long view.

Today, an Aston Martin DB4 or DB5 might be worth £750,000, and even five or six years ago the same car would have been super-valuable, at shade under half a million pounds. You need to head back to the mid/late 1980s, however, to find DB4s and DB5s on sale for between £12,000 and £20,000. In those days, too, a decent Jaguar E-type Series I coupe might have been yours for less than £10,000, a fraction of its £125,000 value now.

Along with other cars from desirable marques, there was no questioning the historical significance, rarity, performance and beauty of the early E-Type and the 1960s Aston Martins. And so, in a way, their stratospheric rise in values could have been anticipated. But in the 1980 these cars were still in ‘used car’ territory- identifying them as investment opportunities needed supreme vision.

To have a chance of accelerating away in value, a classic car needs several defining factors: relative scarcity, a lasting excitement and nostalgia from its launch impact, looks and/or performance that quicken the pulse, and a generous dollop of character that sets it apart from the herd.

On this basis, a two-seater sports car like the Austin-Healey 3000 was a dead cert. These days, the powerful triple-carb MkIII will set you back £20,000 even for a tired one, and well over 90 grand if you want a tip-top specimen. But a vehicle like the Range Rover Classic two-door also seems such a natural using the same yardsticks. A true British design pioneer, for years it was regarded as just a dodgy second-hand motor, and scrapyard fodder when tired. Then suddenly its importance and standing in motoring history was cottoned-on to, and values soared. There won’t be a lot of change from £50,000 if you want a super one today.

For many, of course, the classic car era will forever be a pre-1980s world – before cars wore much visible plastic and electronics still seemed new-fangled. Time, though, marches on. Cars from the 1980s and 1990s are where the hidden classic car investment potential waits to be unlocked.

Start to think about the icons of those two decades and the way they are held in the collective motoring esteem of today.

The attainable cars of the moment in the early 1980s include the Audi Quattro and the Volkswagen Golf MkII GTi. The four-wheel drive, turbocharged Audi is already on the move, ranging from £8-30,000, but for the best examples there’s sure to be much more to come. Examples of the GTi hot hatch icon, meanwhile, can be yours for between £7-15,000. For a performance classic car that was a cult in its own lifetime, never mind now, that looks a good one to cherish.

Even more of a pension pot could result from buying a 1980s Ferrari 328GTB (budget on £70-110,000) or Aston Martin V8 (£50-100,000) today. To many the sums will seem vast, but these are the sorts of thoroughbred supercar of which there will only ever be a small, finite supply. Edging closer to today, and into the 1990s, there are a plethora of interesting performance cars set for solid appreciation: Aston Martin DB7, Bentley Continental R, BMW M5, Maserati 3200GT, Nissan Skyline GT-R, Plymouth Prowler and Renault Clio V6 Renaultsport. Today, none of them are exactly cheap; within a few years, however, you’ll be cursing if you don’t move quickly. At a humbler level, you might find the first-generation Audi TT, a Fiat Barchetta, an early Porsche Boxster or a late air-cooled 911, the late, lamented Land Rover Defender, just about any Subaru Impreza Turbo or a TVR Chimaera. You won’t find such interesting cars as merely second hand cars for much longer.

Classic cars can still suffer the ‘brown furniture syndrome’, where a long-term lack of fashion sees values go nowhere and, in many case, drift depressingly downwards. The motoring equivalent of the large, brown wardrobe or sideboard that’s hard to shift is likely to be any large, lumbering saloon – even pre-war cars. Yes, believe it or not, according to auctioneer Bonhams, many Rolls-Royce Phantom II limousines from the 1930s are actually losing value.

Such cars, ancient as they are, just don’t resonate with buyers. They may have been majestic beasts when the Queen was still a little girl but people in their 50s and 60s, the ones with disposable income, are after something glamorous and exciting from when their own heydays of aspiration. Add to that the important factors of condition, originality and provenance and the explosive growth in Aston Martin DB5, Jaguar E-type, Ferrari Dino 246GT and air-cooled Porsche 911 seems like such a no-brainer…in retrospect, that is.

Giles Chapman is an award winning motoring writer and columnist for various newspapers and magazines. Visit the Hagerty Classic Cars page for more interesting and entertaining classic car content from him and other well-known motoring writers.

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