is the bubble due to burst?

Agree with technom3. The "bright spots" of many recent auctions - which I mean as cars meeting or exceeding the high estimate - are event-eligible pre-War sporting and Veteran cars. Just do a quick review of any 2015 Monterey sales sheet. A pre-War car with a history at the historic MM or Le Mans Classic, or a Veteran with a VCC certificate is an entry ticket to the greatest events. For every post-War sporting car that is MM eligible there are only a fractional number of pre-War cars. Additionally, the engagement and curb appeal of a pre-War machine is a whole "new" experience for most collectors in 2015. I think that accounts for the buyers "branching out," as aptly put above.

Again, all my opinion. But also all through my actual experience.

 

I am happy to stand corrected and defer to first-order experience and observation. It wouldn't be the first time that SCM's data/analysis was overly facile. It's hopeless, but I'd love to imagine a way to truly compare apples-to-apples price movements.
It's gratifying to hear you guys think pre-war prices are strengthening, it isn't a conclusion I'd draw from the auction reports...

 

ersatzS2: like any observation, it's all in the nuances. I don't think all pre-War is strong; in fact, most are flat. I specifically opine about and have experience in sporting/event/race eligible pre-War and VCC-dated Veteran cars. Those two spaces are where some absolutely incredible cars lie.

 

The bubble is bursting since 3-4 years...

 

An undercurrent of this discussion is the extent to which collector car prices reflect temporal fads based on 'fanboy' sentimentality driven by the seasonality of generational turnover, versus true automotive connoisseurship. I suspect the cars you opine on are now and always have been creme de le creme of the collectible spectrum.
My initial comment is spurred by the sense that there is a disconnect between relative valuations of cars that are truly important, regardless of their era, and cars that are bid up by a bolus of enthusiasts who aren't really students of automobildom in a broad sense.
A Lamborghini 400 was a cool car, but was it as important as a twincam 8 STutz from the early thirties? Prices are equivalent in today's market. The T-Head Mercer raceabout was one of the most important sportscars in history so recent auction prices of ~$3M look like a bargain next to the feeding frenzy around any number of mass produced European sportscars.
Maybe its a bad example since it was such a special case, (though many prewar cars are similar) but the Miller 91 'Boyle Valve' car that sold at Amelia last spring sold for ~$750K. Relative to the importance of Miller in automotive history, it seems an incredible bargain when garden variety Aston restorations bring more...

 

Harder to brag about acquiring a Mercer, that no non-enthusiast will be familiar with, vs. acquiring a lambo of any era.

The market is going (has gone) "reality tv" like house flipping shows did a few years ago. I don't think it is surprising at all.

 

Comparables is a valid point and an interesting sub-discussion to have.
That said, the Miller in question was a built-up car from parts assembled in the 90s and was the 'Boyle Valve' 122 rear drive in paint job only.
But I'd still take it!

 

Being only a built up "Bitsa" upon a replica frame and a not real Miller with no real discernible documented race history the "Boyle Valve" car auction price merely reflects the cost of the exercise of building it. There has never been a Undisputed Fully Documented Indy winning Miller sold in public auction.

The only original framed "Bitsa" Miller cars sold in the last 10 years have brought in excess of 2 Million USD each and neither carried their original body, engine, or running gear nor had undisputed histories.

In 1992 the Smithsonian acquired one of the non Indy winning ex Leon Duray 1929 91 Millers (one of two"Packard Cable Specials" that Duray while in Europe had traded to Ettore Bugatti that were later found and acquired at the Bugatti works by Griffith Borgeson and returned to the USA and then was later acquired by William Fisk Harrah) from Robert M. Rubin (ex commodities division founder of Drexel Burnham Lambert fame and co-founder of the AIG Trading Group) in a transactional deal that was valued at 5 million USD at the time. This car was a totally restored Undisputed Fully Documented all original car. If available today it is certain the value would be well in excess of the original transaction value.

Therefore the only Real, Undisputed, Fully Documented, Original Indy 500 winners currently existing that have been in the same private hands for more than 25 years would likely require a high 7 figure number to pry loose if possible.

Real Original Millers or other Real, Original, Early, Rare American Automotive Grail are still extremely valuable, appreciating, desirable and collectable objects to the academically, educated and astute collector no matter what their age maybe. Only time will tell if the New Moneyed Generation has the ability and intellect to be able to perceive their importance, contribution and relevance to the automotive collector discipline.

 

Yep that last sentence is my point.
I understand the history of the Boyle car, and the distinctions between 'Real, Undisputed, Fully Documented, Original.' The Boyle Valve car is neither important, nor historic by the Fred Simeone definition.* That said, neither is a mass-produced Lamborghini, Aston DB5, or even a 300SL, all cars that the market values more highly than that Miller, and much more highly than dozens of distinctive low volume pre-war 'supercars' like American Underslung, Packard Twin Sixes, Stutz DOHC roadsters, or aforementioned (albeit bitsa) Duesenburgs.

If the Leon Duray Miller were to sell today, I am sure it would bring a great price, but in the $50M neighborhood of one of the GTOs? Doubtful, which is my 'undervalued' point...

*(I'd argue, however, that it ranks above a Kirkham Cobra replica or a Pur Sang Type 35 due to high original content of important components)

 

"The Boyle Valve car is neither important, nor historic by the Fred Simeone definition.*
*(I'd argue, however, that it ranks above a Kirkham Cobra replica or a Pur Sang Type 35 due to high original content of important components)"

The Boyle Valve Creation is nothing more than a Replica, Recreation, Tribute or whatever charitable definition one would give in the presently PC world to the word fake and it has no rank nor can it be compared to a OEM factory manufactured vehicle containing the original chassis: (Lamborghini, Aston DB5, 300SL, American Underslung, Packard Twin Sixes, Stutz DOHC or "Bitsa"Duesenburgs.) The only value it has at all are for its contained original parts and the cost of the labor to produce it no more no less.

"If the Leon Duray Miller were to sell today, I am sure it would bring a great price, but in the $50M neighborhood of one of the GTOs? Doubtful, which is my 'undervalued' point"...

I apologize, perhaps you misunderstood, I am not comparing a Duray Miller potential sale result or value to any potential GTO sale (which coincidentally has not exceeded 38+ change million USD in any public auction. All other reports of GTO sales at higher prices appear to be unconfirmed rumors) or any other marque value for that matter. What the final result the Duray Miller would bring can only be speculation as it will never happen due to its present possessor location.

My point is: What the Duray 91 could bring should it or a REAL Indy Winning Miller ever come to market certainly could and would exceed the result than it would have in the years prior to the present markets run up. Whether or not that it would exceed 38 million USD is immaterial.

In conclusion if I understand your point and you mine, I agree the important correct original cars of this period are generally undervalued and unappreciated (with certain exceptions) by the currently under sophisticated incoming moneyed collectors entering the market. Hopefully this might change as they become more academically educated and less reliant on the hype of the now dominate various marketing machines involved in vending them. Cheers.

 

Within the constraints of a web forum discussion, yes we agree!

 

Here's a little fuel for the fire:

Jay Leno wannabes? Classic car market goes into overdrive

 

Who needs a financial planner when you've got this guy! LOL

https://twitter.com/sheikhamari/status/563063544196104193

 

He knows nothing. Rob Lay and I entrust all of our money to Reza.

http://www.ferrarichat.com/forum/canada/485804-who-reza-mokhtarian.html

LOLOLOL

 

For the first time during this whole discussion we finally see a financial action which could affect prices

World watches with Fed expected to raise rate - Yahoo News

 

THE CLASSIC CAR MARKET - 2015

There's been a lot of discussion about the performance of the classic car market over the last 12 months, some doubting the continued growth whilst others believe the market is still in its infancy. The reality is values have steadily increased again throughout the year and forecasts for 2016 show no let up at all in the global markets for the finest classic cars.

Historic Automobile Group International (HAGI™), the respected independent investment research company
which specialises in the rare classic motorcar sector, showed that the market (HAGI Top Index) had an annual increase of 24% for the first 11 months of this year (2015), which re-enforces the expert's belief that the demand will continue next year and beyond. The highly regarded KFLI (Knight Frank Luxury Index) which presents all types of asset classes again shows classic cars YTD up 18%.

This is led by a number of factors; economic growth globally, low interest rates and the continued acceptance of cars as a good investment. But also, for many collectors, cars have become a form of art.

It is indeed harder now than any previous years for us to purchase good quality cars in the market place that meet our high standards and requirements of condition, history and presentation.

So looking to 2016, we believe the demand worldwide will continue for the finest classic cars presented in superb order with excellent provenance. Buying quality is the key and with quality much in demand, we see a continued healthy future for the classic car market in all alternative asset classes.

The key factors that we identify as to an appreciating classic car still remain now as they have done in the past; the highly regarded marques will continue to be in high demand again; Ferrari, Aston Martin and Porsche, with low production numbers also a prerequisite.

The year has ended on a high again for the classic car market with the sales in New York last week achieving world record levels for Ferrari, Aston Martin and Porsche.

 

A quick look around the classified websites says there must be around 50 Daytonas, 20 275s (2 and 4 cam) and around 20 330/365GTCs openly for sale worldwide at the moment. If finding these cars is not difficult the inference above must be that the cars being offered are not good quality or the asking prices are unrealistic?

 

Given some of the storm clouds on the horizon (interest rates and inventory) we'll probably find out in 2016 whether the Hagi Index is a leading or a lagging indicator.

 

the rapid increase in prices created a void in price between valid cars and those considered as discards ready for the breakers. Demand enhanced by opportunity profit allowed cars otherwise destined to the junk yard to be rescued and resold into the market place. The question becomes one about the quality and durability of recreation and how these cars can compete in the long term. The average buyer only sees the "shine" that conceals who knows what, making the cliche' "buyer beware" paramount.

 

The spread between grade A cars and the rest is around 40% of the price. Collectors, buyers want grade A cars, original low mileage, low ownership car with no questions, these cars are very hard to find, the float of average cars that seem to come on to market are mainly the same. A basic example would be an F40, a recent car sold in the UK for 1.1 GBP through GrayPaul classics, the sale is common Knowledge, car was 2000KLM, 2 owners perfect. The average F40 can be bought for 700 GBP. These cars at 750K nobody seems to want, but the perfect cars sell very quickly. This seems to be the same for every car and Brand.

 

+1 and perhaps whether auctions lead or lag as well.

 

From a very uneducated Ferrari perspective on the market for lower cars. The 348 is the one I follow:

- When I started looking there were like 20 for sale.
- When finally I bought mine 2 months later there were already 0 (yes none at all) for sale in the 'local country' ads and got it through a friend's contact
- I disliked the car and decided to sell and move on. I sold mine when there were like 20 for sale in the EU.

A few ->weeks<- later there were 30. Later like 40. Suddenly it jumped to 90. As of today there are 94 for sale in EU with ever lowering prices.

I noticed similar trends for the 328 and 308

I hope in 2 years time I can be back in the market after being priced out and buy sthg I enjoy. Otherwise I'll have to look for sthg else (shrug)

Just my 2cts.

 

50 Daytona's out of a close to 1300 produced and say 1100 left is about 4.5% of the fleet "for sale", that does not seem a lot.
M

 

It depends on how many buyers are out there, as prices increase the number of potential buyers decreases.

 

basic supply and demand at work... the rapid increase in numbers available may be an indication of speculators and weak owners that must liquidate to avoid any loses... true Ferrari owners generally are not spooked by market conditions as they bought the car for themselves for the longer term... larger production numbers makes cars available to purchasers for reasons other then enjoyment of the brand and easier "to spook the herd"