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Old 06-06-2012, 05:52 PM   #61 (permalink)
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I agree with Crash. The semantics are drowning out the real subject. I agree the cars are assets, just like the silverware in the drawer even if it is only 18/8. Anything can be sold in exchange for money and not necessarily to make money. Even used oats; that's called fertilizer. But the original title of this thread is "The fallacy of old car appreciation " Appreciation is a growth in value. Selling something for less than the investment does not show an appreciation in value. Just the opposite. This is where the majority of us are with our rides. So? I don't view it as a commodity. I don't recall ever seeing a daily update on the value either. What would be the ticker? Must67Vert? Too many letters. So they are a crappy investment monetarily, as most things. In fact, some things you "invest" in actually are disposed of as crap, and at a cost too. Even if you are on a septic tank. Somebody has to pump that thing eventually. Life is about getting continually separated from the majority of your money because that's how businesses make money. Some people squirrel it away and others live pay check to pay check. Pick your poison. I'm for living a comfortable life with the top down myself and I plan on doing that a loooong time.
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Old 06-14-2012, 12:52 PM   #62 (permalink)
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In 2004 WSJ published an article about investing in classic cars. The article in the link below reviews the WSJ picks to see how their predictions were. Thought it was an interesting read, and relevant to this topic...
Are you smarter about cars than the Wall Street Journal? | Hemmings Blog: Classic and collectible cars and parts
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Old 06-14-2012, 05:09 PM   #63 (permalink)
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Under the HOLD section.
Quote:
1966 Ford Mustang convertible
Typical Price/High Price, 2004: $19,300/$31,100
Change in price, 1999-2004: 74%
Change in price, 1994-2004: 48%
In spite of big supply – Ford made tens of thousands of these convertibles in ’65 and ’66 – prices keep climbing. Credit iconic good looks, cheap maintenance.
Typical Price/High Price, 2012: $25,800/$38,400
Change in price, 2004-2012: +23.47%
Almost $40,000 for a six-cylinder Mustang? Really? Maybe for a 225hp 289, but I’d call that number at least $5,000 high, maybe more, for a six. Either way, it was definitely a “sell” in 2004.
I wonder what made them picked only one model year and it isn't even the first.
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Old 06-15-2012, 09:04 AM   #64 (permalink)
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Quote:
Originally Posted by Klutch View Post
Good points, dodgestang. There does indeed seem to be many misconceptions about classic car value.

I've mentioned this before, but I recall a tragic example on the TV show "Chasing Classic Cars". A widow asked Wayne Carini to sell her late husband's 1960s Impala convertible. It was a beautiful, nicely restored car. But the owner never ejoyed it. The widow talked about how her and her husband would sit in the car, while parked in the garage, and imagine they were going for a drive. "Gotta keep the miles off it to preserve the value", her husband would say. That's just crazy. Not only did the guy and his wife never enjoy the car, it really wasn't that valuable. And the number on the odometer was irrelevant to the value.

I also saw a 90's Mustang at the Barrett Jackson auction where the owner had bought the car and immediately stored it. He kept it for over ten years. It sold for roughly what the owner paid for it. What a waste.

What most people don't realize is classic car value is based on what collectors are interested in. For Mustangs, that's primarily Boss and Shelby cars. Thus, those are very valuable. But this gives people the misconception that a low-option '66 coupe is also very valuable. Sure, lots of people would like to buy the car and drive it. But it doesn't make it very valuable.
So what happens?? CaWeenie took that car to Ca. "cross country" put it in a no reserve
auction and got the woman a mediocre price...NOT to mention his fees!
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Old 06-15-2012, 10:48 AM   #65 (permalink)
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I think it's just in how people look at their cars. It's just a car for me that I can enjoy, but I won't keep dumping money into it if I won't get it back. I can take better care of my family if I buy a car that I know I can make money on in the long run. I don't buy cars because I am emotionally attached to them, or because I just want to have bragging rights over other people.

This subject is like bringing up politics or religion, there will never be complete agreement on in. I love classic cars, but in the end they are just cars.
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Old 06-15-2012, 11:03 AM   #66 (permalink)
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Lol!
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Let it be known that I do not street race or condone that sort of thing
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Old 06-15-2012, 12:09 PM   #67 (permalink)
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Nothing better than enjoying your hobby AND making money at it
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Old 06-15-2012, 03:06 PM   #68 (permalink)
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I've sold old cars for a profit and sold old cars for a loss. It's the frictional costs that get me (insurance, tag fees, gas, and parts) that make me just:

Hope to break even...
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Old 06-15-2012, 03:44 PM   #69 (permalink)
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Quote:
Originally Posted by 95CobraR View Post
I've sold old cars for a profit and sold old cars for a loss. It's the frictional costs that get me (insurance, tag fees, gas, and parts) that make me just:

Hope to break even...
Most the cars I run into are not nice cars and I usually sell them pretty quick and don't have those costs. There are many different aspects of classic cars and some people like to just drive them and enjoy them and there is nothing wrong with that, I just like to do both (Enjoying them and finding them for resale). Nothing wrong with either, just different outlooks.
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Old 06-15-2012, 03:49 PM   #70 (permalink)
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"The fallacy of old car appreciation"
There is no inherent fallacy here but the statement has a lot of ambiguity.
"Old car" is about as ambiguous as it can get. It would be nearly impossible to lose money on one of the 6 remaining Shelby Cobra Daytonas or a Gullwing Mercedes, or name your own favorite iconic car of high value and limited numbers. Here on a Mustang forum however, where "old car" implies cars like we all have, mostly run-of-the-mill FORD Mustangs, one of the most produced cars of all time, the brutal truth is that almost exclusively, none of us have a car that falls into the same category as these other "old cars".

Again, there is no particular fallacy of old car appreciation. It is true that SOME old cars will always appreciate, but a 1966 Convertible, etc, are just not in that same category.

I always think about it this way also; There's the same amount of work, more or less, in replacing rusty sheetmetal on a Pinto as there is replacing rusty sheetmetal on a 1957 Ferrari Pontoon Testarossa. So even the maintenance argument falls down at a certain point.

So the bottom line is, your starting point determines what you end with. I've made the same mistake. I dumped TONS of money into an old british car with a very low final value for even a pristine car. I lost my behind on that deal and I realized that, if you want to make money, you're best off starting with the vehicle of the highest end value that you can afford.

Just like with anything, if you want to make a million dollars, you're best off starting with 2 million dollars.

JACK
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Old 06-15-2012, 04:49 PM   #71 (permalink)
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OK how about this one to make you feel sick about the US dollar. In 1964 silver coins were silver, if you took your $4500 for your new Mustang in 64 (just a guess) and got 4500 silver dollars, at the current exchange rate of $28 per ounce, your money would be worth $126,000. If illegally melted down and sold, that is.
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Old 06-15-2012, 06:44 PM   #72 (permalink)
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Quote:
Originally Posted by Stevea View Post
Most the cars I run into are not nice cars and I usually sell them pretty quick and don't have those costs.
I agree.

But it takes a very knowledgeable guy to do this.

I just returned from the 2012 SAAC convention and learned a thing or two.

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Old 06-15-2012, 06:46 PM   #73 (permalink)
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I appreciate old cars daily.
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Old 06-15-2012, 09:14 PM   #74 (permalink)
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Quote:
Originally Posted by zray View Post
this is just nonsense. Buy what you want, and drive it how you want. THe whole point of having insurance is to let someone else do the worrying.

Admittedly GT-350's and Cobras are not "throw-a-way" cars, but they are not irreplaceable.

Z.
Missed the point totally, I would also drive a 350 if I chose to have one. I have several vintage vehicles including a survivor panhead harley with 20k mi they all get driven all the time - I totally agree: "that's what insurance is for".

My personal opinion was that i knew I wanted to do modifications and I personally would not significantly modify an original 350. I don't expect everyone would or should feel this way...

M
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