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Rule number one is that you need to buy on condition more than any one thing.  Buying a wreck or a heap even if it is a very rare Porsche or Ferrari can easily turn out to be a financial nightmare. The cost of restoring a car in poor condition almost never seems to bring a price that gets close to recovering the up front costs plus restoration costs. Restoration costs for even a mid 1960's or 1970's domestic can be never ending.   Labor costs keep going up as there is an ever increasing demand for quality restoration services.  Too many people fall in love with a particular vehicle and can go overboard trying to make it perfect.  That is what I call letting emotions rule over business sense.  This is the most common mistake in classic car buying.  

Rule number two is don't get caught up in the hype that one particular make or model will continue to increase in value.  One of the largest insurers of classic cars, Hagerty has several different indexes (which we will further discuss in the
Current Trends section) They use categories such as Blue Chip, Ferrari, Muscle Cars, British Cars, 1950's American, Affordable Classics, and German Collectibles. But you as you will see the markets though different do seem to have similar long run trends.   So you do not have to invest in say a Blue Chip type of car to get a good return on your investment.  In some cases the lowly affordable classics can out perform the highly prized Ferrari or Blue Chip category which represents cars that can easily cost hundreds of thousands of dollars and get into the millions.   So a well placed $10,000 investment into a very clean 1977 Corvette can have a better long term investment than say $85,000 purchase of a very nice 1969 Jaguar XKE convertible.   Whatever category and type of vehicle that strikes your interest can do well in the long run if you really get the feel of the demand in that market and you buy a vehicle that is in very nice condition that can hold its value if properly maintained.

Rule number 3 is know and trust the source selling the vehicle.  One of the reasons the major auctioneers such as Mecum, RM, Goodings, Barrett Jackson, Auctions America, and especially Bonham's are so popular is that these companies are extremely reliable and trustworthy.  They try very hard to document the vehicles that pass their auction block. There are of course excellent local storefront dealers across the nation too.  But like any business there are many scoundrels who are nothing more than the dreaded shady used car dealer.  There are no warranties, so buyer beware.  One must be especially careful of eBay auctions in that this is where many cars are to be found.  When bidding on eBay research the vehicle.  The good thing about eBay is that it covers almost everything.  If you can go look at the vehicle in person.  Craigslist is good because one is encouraged to view the vehicle and even have it checked out by a local expert.

To sum up these rules is first condition is most important.  As they say when investing in real-estate location, location, location.  The same rule holds for collectible automobiles in that is condition, condition, and condition.  Know your cars and know your market and lastly avoid the crooks.  They are only there to take your money and disappear.



                    

 

Examples of Blue Chips (click on images for detail)
 
 
 
 
Examples of Affordable Classics