I respectfully disagree with a couple of your points. First, let's consider the idea that "If the market stabilises just by the nature of many of the new owners/investors they will look to sell their asset and look for the next asset class to invest in." I don't necessarily believe that "investors" are driving the market here, but even if it were the case, I think it more likely that hard assets like gold, art, and "Enzo era" Ferraris would be held as a hedge against monetary debasement rather than a search for absolute returns. Secondly, your contention that "if the demand is removed and it becomes supply, the market is only going one direction - down!" Of course demand is variable, but the supply of "Enzo era" cars is both known and finite; and as such, increased demand can only drive price, as supply is fixed. In short, I think your GTB will stand you in good stead! Is the market a bubble? Well, parabolas are rarely a promising sign, but have you priced a new car? My '64 330 is arguably the low end of the "Enzo era" Ferraris, and if I were to be optimistic for a moment, might command $180K. A Mercedes SLS AMG or Porsche 911 can easily exceed that amount and I wouldn't for a moment consider an even up exchange for either; I prefer the smell, sound, and feel of my car. Our cars are an experience, not an ETF...
For run of the mill exotica you may be right, but some cars have passed into the annals of fine Art. Look at 540K prices, any bugatti, or duesenberg, these cars demogaphic is long gone but they go up. A 250 GTo is a 50 mill car today and apparetly a pontoon Tr is 39 Mill, these cars are now art, and there are more rich people globaly very years competing for limited asetts to hoard. But yeah 60's americana with arcane differences of which there are 10's of thousands of copies with monor code difference will go the way of model T's and 57 chevies, they get restoresd and saved but desire passes with their generation. Put it this way a 1930s buick is a hard sell, the owner base has died off, a 1930s bu or duesy, everyone wants one regardless of age. One last point with the trippling of the money supply a 50 mill gto is really only a 25 mill gto in 06 money. Yeah the GTo will be the first car to hit 100 mill, maybe it will go down between now and then maybe not, but here were only 37 and how many billionairs are there on the planet today.
Given what you guys are saying, I keep expecting a price collapse in Duesenbergs (or even Cords) yet it never seems to happen. Oh well, maybe some day.
One aspect of what the younger generation do with their free time is play computer games such as Gran Turismo and Forza Motorsport. Games like these feature a lot of classic cars (from muscle cars to the 250GTO and 250TR) which will increase awareness to a new generation. Considering how much the car manufacturers are investing in these games as marketing tools logic would assume that there will be some knock on effect on the classic car market as well as some of these game players grow older and increase there disposable income to invest in actual cars rather than virtual ones?
+1 -- Like it or not, the fanatics of these games are the future enthusiasts. The real driving games like Gran Turismo and Forza do allow them to appreciate the early Ferraris. Unfortunately, shooting games like Call of Duty seem to be about 10 times more popular than driving games among teenagers.
Simple solution: offer a Ferrari, classiche certified of course, gun rack as an optional extra with every car. ;>)
Bubble? There will always be an interest and value to the great cars,but of those there are few. yes you can hide some assets in significant cars but you have to like them first so its not just an investment. I had an Aston DBMKIII, I loved to drive it, sold it for $10,000, would buy it back for 50,now. They are selling for $300,000 are they worth that-NO. To me thats a bubble.Its showing some erosion already in the lower end cars-Austin Healey, XK150s, nice ones just arnt selling for their reserves. You cant use Scottsdale as a barometer-buyers there just want to be seen and get their 5 minutes of fame.
1966 Jaguar E-Type Series I 4.2-Litre Roadster | Art of the Automobile 2013 | RM AUCTIONS This is not sustainable.
Wait for the correction in the tech bubble. Then these over priced speculator machines will quickly follow suit.
This says it all. Looks like the ferrari car market graph. This was the graph before the market crash in 1929 and looks similar to now the the classic ferrari market. No bubble ? Image Unavailable, Please Login
It started already, only yesterday the floor dropped out from underneath some collector corvettes. ba-dum-bum-CHING
No one knows for sure. Looks rather frothy, but prices were stangnated for years and are no where near the return from the market since 2008-9. Most stockes have gone up 2-3 times, many over 6 times, not Ferraris..
Sorry for the Highjack... What I found hard to sustain, or at least confusing, or debatable, to me as a french, is the use of the french word "rotisserie" in that article for describing the device, or chassis, onto which you secure the car to turn it upside down. Because in french a "rotisserie" is the place inside which you eat roasted meat...or, in other words, a rotisserie is a restaurant specialised in roasted meat. The device onto which the meat itself rotates is a "rôtissoire", no a "rotisserie"... As for the "bubble" itself, prices reached during Retromobile seems to demonstarte that it is not yet bursting... Rgds Rgds
A Mercedes 600 Pullman in need of a lot of work went for over 500K this week. So, you tell me. Bubble?
Art sales hit an all-time high in London this week, with top auction houses Sotheby's and Christie's both registering record-breaking figures in a spate of buying fuelled by growing demand from keen new Russian buyers as well as from more established markets. Their two auctions garnered a jaw-dropping total of £340 million.($565m) In the world of collectables classic cars are just scratching the surface. Forget old prices and look instead at the value of competing collectables. Ferraris have a long way to go before they become too expensive for the real money. In that world $1m buys very little.
Interesting to note the 2 scales though. The 1929 crash was from 380 to around 200. A fall of approx 43%. On the matching current timeline scale even if you were to believe the hypothesis, you would be expecting a peak to trough of approx 20%, of which 5% has already happened. Sure a fall of 15% in the equity markets is a big move but it's hardly fire and brimstone stuff... Clearly classic prices can't go up for ever but I'm not honestly sure what causes the correction. It seems to me people are buying because they don't know what else to do with their money and to a certain extent cars and art are like gold, they are currency independent and being seen by some as a safe haven, in a world where we don't know which currency is safe or if we are going to get inflation due to cheap money - Which is why I think cars shrugged of the fall in 2009. It's not clear to me a fall in the equity markets causes prices to fall. Not saying I'm super bullish from here but I find it difficult to buy equities or bonds at these levels, so I'd prefer to own something I can enjoy both looking at and driving!
pffft, bubble?... look what this ultra rough Gullwing sold for.. Unrestored Gullwing fetches $1.8 million - Slide Show - MarketWatch lesson learned - don't restore your car! (pardon me if this was already discussed... too many pages to flip through)
The way I see it there are a lot more wealthy people int he world, and they dont need or want or trust more paper, so they are spreading their risk. Fearrai is not ablue chip collectable, you dont have to know anyhting baout cars to know that 60s ferraris and earlier are good.There were only so many old ferraris made, and there are more people each year who want them. That means people below a certain value dispalce into "lesser" cars. That means 50's alfa romeos are now appporcahing what was boxer and dino price territory and boxers dinow thye go up> for those who cant get into a 250 series ferrari there are stons and maseratis from the same era. As to american muscle, there were just so many made, and yeah a different color and dirrent seat and different consol means only 50 made in 1 year, but that is not real differentiation. Plus muscle is so easy to clone, so muscle will stay flat and or depreciate. But stuff from the 50's and 60's from italy with designs, limited prod, rare german pieces, they are going up, you can add etypes to the list even though there a lot about. Italian stuff from the 70's and 80's well look at stratos prices 288 prices even the move in boxer prices. Frankly if its hand made, beautiful less than 2000 made comes from euope stick non electronic and pre 90 its going up. Look at prewar stuff the bread and butter is flat and sinking as the demographic dies off, but the special machines, the dueseys bugattis stutz cords certain rols royce, bentlyeys, they have a life of their own trnacendign eras, they are now collectable art, and anyone with enough $$$ wants wone, each year there are more people with enough $$$, Some things though that are not really rare or special, but are hyped will fall. Is an Alfa guila veloce really a 150K car, maybe. 150K is what it cost to restore one really well. But a late 70's alfa spider, how can it really move, whereas a duetto the same car in principle is stills pecial. So choose wisely and keep your car because over 20 years there will be more people wanting it, and less to go around.
When your mom or sister, who have never shown any interest in any kind of car, start talking about car collecting and wanting to buy one, it's time to get out. And that time will come, sooner or later. You will never be able to predict when. You will either be early or late. The bigger the bubble gets the worse the fallout. I would much rather see slow and steady from this point. But these are finite numbers (especially Ferrari and Picasso and the like) and when you are a billionaire and like toys, you wanna win, regardless of cost. And the bursting problem starts with these guys when they decide to start dumping stuff. But they and only they will decide when its time to burst the bubble. Then, it trickles down, then starts flowing. Lets hope that doesnt happen, but inevitably it probably will.
At a show yesterday I was struck by how many spectators' first question wasn't about the cars but about the price. When any mania reaches the man in the street it often means that its just about over.
