What Makes a Classic Car, and What Determines It's Price?
Classics are held in higher regard than other cars, usually standing out from the traffic. While most used cars lose value over time, often classic's gain value after a few decades with some now worth millions!
Classic cars. Classics are models that car enthusiasts hold in higher regard than any others, usually with a design, preformance or character that make them stand out from the traffic. While most used cars depreciate, losing their value over time, (between 15% and 20% of its value each year! Source: Cars Direct) classic cars often gain value after a few decades, some now worth millions more than when new. Take the modern classic, the Mercedes AMG SLS Black Series, for example. New, the SLS Black Series had an MSRP of $275,000. But today, searching GAUKmotors.co.uk and scouring the rest of the web, the cheapest Black Series we found was $350,000 with 38,000 miles on it. The most expensive example, with only 150 miles on it, wants a whopping $500,000! Now, if you ask me, that's a pretty tidy profit for whomever bought it new. Classics are worth so much because collectors around the world are outbidding one other just to get their mitts on these fossil-powered works of art. Some models start out as regular cars but develop a cult following years later, becoming a classic. Well known examples include the Mini Cooper, Citroën 2CV, Fiat 500 etc. Collectors are known to hunt down anything missing from their collection, anywhere in the world. So, what else determines the price of classic cars for sale?
Production is Limited
Quite obvious, but the first is rarity. Simple economics dictates that when supply is low, the price shoots up. There's less to go round so you have to pay more if you want to get your hands on it. Sometimes manufacturers make a point to release models with limited numbers, immediatly establishing guaranteed rarity from the get go, essentially creating a future classic. A good example of this is the Ferrari LaFerrari, where only 499 units were produced. Other times disasters, natural or manmade, or simply age can be blamed for the reduction in number. Time passes, cars change hands and get modified, driven hard, neglected (often times all three) until eventually they end up in scrap yards. Some models are now over a hundred years old, most well known being the Ford Model T, another cult classic. Others are decades old and already suffering from shortages. Japanese sports cars, for example the Nissan Skyline, Toyota Supra etc. suffer from being favourited by the younger enthusiasts and the drifting, street racing and tuning communities, meaning these cars are often modified and driven hard. This means that clean, stock exaplmes of these cars are already drastically increasing in price. This leads us on to our next point.
Ideally, Collectors would like their classics to be stock, or at least as close to the original configuration as possible. Those who preserve these future classic vehicles directly from the factory can be sure to look forward to a nice tidy sum when they decide to let go of their prized possession. Of course, many things can prevent this from happening. Breakdowns for one, so the original owner might already have replaced some parts to keep the car running and roadworthy. Perhaps they didn't predict that their car would become a classic and have more value in the future, so treated it like any other run-about. Some savvy owners who are aware of the future implications non-original parts may have on the value of their classic attempt to keep their future classics pristine and original by obtaining the same original parts from scraps.
Last but not least, we've got to remember that these are cars, not paintings, so collectors will definitly want to be able to drive them, even if they aren't going too and they are going to be sat in their garage with their other 20 cars. If the car is roadworthy, then they'll be much more likely to give you a large amount of cash in exchange for it. This isn't always possible though, some cars are simply no longer fit to be driven on modern roads, and some are too difficult to drive at all, but of course they still look stunning in a showroom! They can also always find a home in auto museums.
Are you interested in classic cars for sale? Then consult an expert before making a purchase! He might be able to help you find a future goldmine!