Art, I'm not one of the people calling out a classic car bubble but I do think that some of these recent modern increases are reaches by people desperate to get in the game with what they can afford. I own four Ferraris: an F40, 550 Maranello, 348 TB Challenge, and a Daytona. Full disclosure: A dealer has the Daytona for sale as I don't drive it any more. The other three are not going anywhere and I have turned down ridiculously high offers for all of them. I don't care if they go down as I love them for what they are, not what they're worth. If I add another Daytona in the future, I'm adding a comp version as the one I'm cutting loose is a stellar street version. I wouldn't use a street car but I would use a comp car.
most dealers don't own their inventory so I wld take them out of the equation fwiw. they don't have huge balance sheets - quite the opposite actually.
Anyone who honestly believes that they will be able to buy anything but a total basket case of a Dino for under $200k in the nearest future, clearly is not linked to any form of real knowledge of the market, or lives in total fantasy land! I suppose that this would mean that we could expect Aston Martin DB5/6 to be in a similar range, by your logic?! similar prices/similar production era and build number and a similar value increase over the past 5 years..... Even if the numbers mentioned were in £ Sterling, i would still find it difficult to believe. The only way this event scenario could happen is if there is some total melt down as we had in the late 80's in the overall economy..... which could happen of course , but then we would have bigger problems to worry about than the values of our car collections, i think!! BR, Jez
Watch and learn is all that can be said. I love these things as much as you do but I'm not the kind of person to let it cloud my judgement. Don't say we didn't tell you so. The writing is on the wall. Whether or not you want to pay attention to it is entirely up to you
but i don't care , Brad ..... its clear that you do, for some undeclared reason! What you keep on about regarding this subject in particular, is of little to no value to anyone on this forum...... and appears that only you and a couple of others keep on banging the same drum. We get it .... you think the market for certain Ferraris is going to crash ..... please move on ,PLEASE!! BR, Jez
Let's keep in mind the title of this thread: "Is The Bubble Due To Burst? I find Brad, Super_Dave, and others' comments to be insightful. After all, it is just a debate.
For it to be insightful John, there has to be some form of logic reason and meaningful data to back up any point of view ..... that is where i am coming from ..... otherwise its just spouting off! For example , Dino's (to take Brads constant example), have grown consistently in value over the past 10 years, about $25-30k per year if you take an average. They are now sitting at around $400-500k. If someone says they believe that in the near future these cars will be changing hands for $200k or less, then i would love to hear a reasoned argument to justify this possible scenario. I love a good debate ..... but it needs to have a basis in some form of reality, dont you agree? BR, Jez
Look at the value of the Dino pretty bubble and look at it now. Need I say more? I respect your opinion bu to say that I'm simply running off at the mouth is absurd. I guess economics and free economy are irrelevant to the subject matter? Good grief
Do you own a Dino? Do you want to have one some day if you don't currently have one? Have you owned one before? They aren't the fastest cars. They have lots of short comings. They have bad rust issues that have to be addressed. I FULLY understand Economics 101 (I think I got a C in that class). Supply is finite. There are less than 3000 Dino's still around. That is for the world market. Demand has been driven by speculators to some degree, I get that. At the end of the day, there are enough Ferrari guys that like cool stuff. The Dino fits the bill. I have always said I think the Dino should maintain a price higher than the new V8 model. That is in your range. However, where is someone going to put there money after they "Cash Out" of their Dino? The dealers have to flip cars. There are a handful that have flipped between dealers, but these cars have been absorbed. The one thing the dealers have done a very good job of is popping cars out of long term owners. Most of these cars have been unaccounted for for a long time. ALMOST ALL of these cars I have seen need a ton of money invested in them. These typically sell at a number higher than I would think. Parts are not cheap for the Dino. A lot of parts can't be found and have to be made. Restoration work is not cheap. If you want to talk about Bad Driver state cars dropping, I could buy into that to a certain degree. Properly restored cars are a different issue. This thread started 2 1/2 years ago. At some point, every market will correct or pop. I don't think there is a huge crash in the Duesenberg market. But they have fallen out of favor by the current generations. I can't remember any conversations I have had with people in my age group that talk about longing to have one. 2 1/2 years in and still the opposite. I get more questions about Dino's from Ferrari guys than I ever have. Most of which go along the lines of, "I wish I had bought one before they shot up". These are people that would definitely buy today if they could get yesterday's pricing. I think what we will see crash is the modern car market. All of the electronics and computers are a recipe for disaster. Manufacturers only have to provide support for cars for 10 years after manufacture. For the specialty manufactured cars, it starts to hurt bad and fast. Try pricing parts for just about any limited production car 15-20 years. It is crazy. I think it should also be noted that the majority of cars like a Dino are bought for cash. When the market gets shaky, people don't just walk from cash purchases. They are more likely to sit and wait rather than guarantee a loss. This wasn't the case in the late 80's. There was a lot of financing involved. In bad times, Dealer's generally start taking cars on consignment and not buying them. I don't see that happening now. What I see more of is dealers trading cars as "Packages" to take care of a current client. This typically goes "I will trade you this if you take that". Dealers with long time clients that need the tax exchange do this all day long. I am not saying trees grow to the skies. I think the best advise I heard was from Steve Forristall. He was a huge dealer in high end Ferrari's in the 70's and 80's. In speaking with him about how he didn't get caught up in the crash of the late 80's/early 90's, he said he knew the music stopped when he started getting calls from brokers offering a car that he had sitting in his shop. At one point, he got three calls in one day about a car sitting about 10' from him. All were offering to sell him the car. Dealers are driving prices. But they also are placing cars. They can't meet demand. That tells me demand is exceeding supply. I don't see anything changing unless we get a blip up and then back down.
This is exactly the point I made earlier. I idont own a Dino. That had nothing to do with it. I was merely using it as an example. Classic cars are bubble at this very moment. Owning a Dino doesn't qualify one to say no, price is here to stay. America is ruled by a free market economy. And one way or another the fee market will re-grasp the actual value of these cars. It will happen. And when it does, you expect the value trend to go up? Hysterically funny. Keep dreaming.
im not sure what ur position is...can you respond to my post 1314? r u saying the entire world is going back to 2008 or that the world is going to be fine, cars might also be fine, BUT dinos are an idiosyncratic bubble that will burst?
Not at all. I stated from the get go that everything will be up from where it started. It's not going back to 2008. But it will be a significant correction due to the ridiculous amount of speculation that had taken place. Feel free to disagree with me. But the facts are inescapable and undeniable Fact 1: the cars are detached from the free market Fact 2: the free market still wants the cars, not refuting that at all. However, the brokers have inflated the prices to high heaven. It is not sustainable. And they will not hold the cars from here to eternity. Doesn't take a rocket scientist to figure this out. Fact 3: the cars will be sold at a lesser value or returned to auction. People will not continue to pay the asking prices. So in conclusion, when the cars go back to the auction and the dealers finally accept that the game is up, jezter70 expects the individual buyers to cause another buying frenzy and raise the price higher? Seriously??
number 1 isn't a fact at all - what asset class is detached from what market? there is 2B of negative yielding debt in the world and for all intensive purposes real rates in the US are also negative...QE has financially engineered a zero interest rate environment - equities are up a lot due to it, so is real estate. so you cant say cars are detached at all. number 2- not really - as I said most brokers and dealers have small balance sheets. the only way you corner a market or drive up prices is if u have a balance sheet big enough to take supply OUT of the market. the prices are being set by owners, who hire brokers and dealers to sell the cars. number 3 is also not a fact - its ur opinion I have no problem with people having opinions, but using opinions as fact when they are blatantly false opinions marginalizes ur points. Ur opinion is there has been ridiculous speculation - the fact cld be these cars were underpriced and undervalued for a long time and have now found an equilibrium, especially now that super cars are 1.3M new and regular cars have 400K price tags. and if u do think they are expensive now, did you not notice they were "cheap" in 2009? why didn't you back up the truck then and liquidate now if you have such high conviction that they are overpriced? or are you sour because you missed the ride up? ur perspective seems rather "trust me, im smart, ur all dumb" yet you draw no connectivity to the rest of the world which certainly matters. maybe im just not following you.
Brad, By your logic, one could just as well argue the point for the following: Provided the free market economy remains on its current course, cars such as the Dino, will continue to appreciate at similar rates they have done over the past 5-7 years, and we will see the first $1m Dino before 2020. UK examples are already trading at between $600-700k (at current exchange rate). Probably less than 200 RHD 246 GTS cars total in existence .... so why not? Wouldnt you agree that this point of view has as much substance and validity ,as yours? BR, Jez
that's exactly the point - are you saying the 10yr is going to 5.5% soon and all risk assets will be repriced? or that Russia is going to nuke NYC, LA, MIAMI, and LDN etc at the same time? if dinos lose 25% is that a drastic rerating after the run up? lets put some numbers and if then statements around this rather than just loosely pontificating.
I have no doubt that all classic cars are likely to bounce around in value over the coming years, but the general medium to long term trend will be up , as it always has been (by how much is the only speculative element in this discourse) .....however to pick out one or two specific models for some arbitrary and undisclosed reason, to crash by 70-80%, seems totally illogical to me. TTforcefed ..... i am with you on this matter, regarding putting something concrete around this discussion. BR, Jez
agreed. why shldnt the market cap of dinos be significantly higher than they were 5 yrs ago? 5 yrs ago the average dino was a piece of crap. today many of them have been restored by some rather talented people. and if dinos are the bubble why were they first to move? usually the "bubble" part of the run up are the later movers which moved in sympathy rather than in value/demand.
Brad, With all due respect, I don't know you. What I do know is Dino's. To the point that Rob thought I was actively brokering them for profit. I am not. I currently own 4. I had five, but I was a bit over budget on my new home and the shop that was "Restoring" one shut down. I sold it because it killed two birds with one stone. I had a window that was about 3 days to solve both problems. Some F40 stuff expedited everything. Wanna guess how long it took me to sell it? One phone call, and that wasn't a dealer. I felt like I left money on the table, but also felt like any buyer would need to protect themselves in buying a car like that. If you saw what was bought and for what, you would use it to argue a point, but if you knew who bought it, that would cause you to go radio silent. We both left with smiles. I am still friends with the buyer. I guess I am sensitive because you decided to pick on Dino's. The most I paid for a Dino was a number that would barley buy a loaded average car today, and that was the last one I bought. If it goes back to your low estimate of $180k, I am still happy and looking around my garage. I can't say the same about the more traditional and responsible investing I did. All of the 401 k, IRA, stock portfolio stuff....well, I guess someone gets to smile about that. It isn't me. I also own a 1970 Mercedes 280SL. My wife gave it to me as a wedding present. Turns out, unbeknownst to her, I had taken pictures of her next to a car that I was looking at for my dad when we had just started dating. She had no idea, but she actually bought that SAME CAR. I will not redo the interior because it has a small rip in the driver seat (the car is all original) that I recognized. Everyone thought I was making stuff up until, when moving, I found the pictures. She bought it for $17k and financed it. That was in 2003. It is a German delivered car without the soft-top. The soft top delete is a hard sale. Even with that option, I turned down a cash offer of close to a six figure number for the car from the person who maintains it. He wanted it for his own personal car (and he was going to redo the interior on his dollar). To say a Dino is going to correct first, I think is crazy. I think the correction already took place, and it wasn't noticed. It took place when crap cars sold for good money. What great cars had sold for a couple of years before. Now we are comparing sales prices and not so much condition. Crap at the same price as great doesn't create a fair market place. Do you notice how many great cars are up? The last I know of is an F-Chatter's that sold low due to a engine matching issue. I think this car was the sell of the century. Dealers didn't bid because of this and a true enthusiast got the car. That is the ONLY example I can name in some time. How many Pagoda's were made? How many of my Dino's are for sale? Shawn
Maybe if we can put some numbers and facts together, using this forums collective knowledge, we could predict the next big thing in the Ferrari market ..... now that might be of some interest and value ;-)) Dino's are great cars, but their value has been fully recognised = high price and probably will stay that way (baring afore mentioned apocalypse!) What about 308 carb cars , almost equally rare in number at the Dino, beautiful design, reasonably quick, usable, Iconic ..... and only $80-120k at the moment ..... surely the bargain of the century!! ...... or maybe these should really be priced the same as a second hand Toyota Camry?! Jez
Now this gets tricky. When I bought my 308, I was young but not stupid. I knew the issues that came with carbs. If you drove it everyday, you might be OK. if you didn't, the carbs quickly became an issue. AS dumb as they may sound, it kept me from buying Dino's sooner. I bought a Black/Tan 1980 308 GTSi. I wish I still had that car today. I traded it for an 87 TR. If you had a carb'ed car today, you need to make sure you have access to someone who knows how to maintain them.
Best part about these discussions...... The one who keep saying "NO WAY!!! The bubble is here to stay!!!, prices are gonna SKYROCKET for the next 20 years!!!!" are the one who currently own that particular car lol. The smart clear headed ones who are saying the bubble WILL in fact eventually burst (and they ALWAYS do) are the one who don't have a vested interest and are thinking with their collective brains not their hearts ;-)
Ah..... interesting from someone that has only posted 8 times and doesn't own a Ferrari! Perhaps the people that actually own these cars are the ones best to comment on ownership value, rather than just rhetoric and speculation? Of course bubbles will always burst , thats just stating the obvious..... i don't think however, that we have consensus in the world of ferrari owners, that we are actually seeing a bubble, and not just normal market forces ..... but i think that is what this thread was started 2-3 years ago, to debate! All the best, Jez
Hi Shawn, I am in the very lucky position of having my carb cars looked after by an indy Ferrari specialist, who also stores them for me while I'm living abroad, but i do understand your point! I just think there is something slightly magical about carbs , the sound and the fact that they have to be fettled every now and then. I also enjoy the specific starting ritual from cold or hot ..... just something lost when i jump into a modern faceless hire car at some airport! I also think that this special connectivity with the older cars is something that underpins the growth in the classic market ..... the universal hankering for a 'lost age' of motoring! Overly romantic? ..... maybe! regs, Jez
Brad, sorry I'm with everyone else. I'm only 52, have had BBI's, Boss 429's, shelby's, cobra's, Porsche, and anything in between because I love it all. No offense but as my daughter would say you sound like a hater. Why? Don't know don't care. I've been an avid collector for 30 years, yep, started young. I believe you are wrong. Have you been in the world market of all cars? Healy's, jag, Ferrari, ford, pontiac, chevy, on and on???? I have. Unless you have actively participated in the market of fun and or rare car's Ferrari or otherwise you basis has no foundation other than what you read. If it's on the internet it must be true.
hopefully someone can illustrate the scenario where cars go down significantly but stocks, bonds, real estate, commodities, and FX hold in tact. because that's what wld have to happen to label the car market as a bubble. maybe what these people mean is the whole world is in a bubble and everything will go down massively. or maybe they just don't know.
