My Car Quest

November 13, 2019

How Do You Value A Collector Car?

by Mike Gulett –

As we get closer to the end of the year and past the holidays we will soon be in the midst of the Scottsdale, Arizona auctions in January 2020. These are the first collector car auctions of the year and they set the trends for the rest of the year. They get everyone in the mood to buy and sell, or not.

After a down trend in sales and values of certain models demonstrated at the Monterey auctions this year collectors are looking forward to the new auction season. Buyers may have opportunities to buy a special car at less than they could have bought it last year and sellers may be hesitant to let a good one go now at today’s prices.

Understanding how to set a price for a collector car, either when selling or buying, is important.

Determining the price to pay, or the price to sell, a classic car can be a challenge especially when there were few examples made. Few cars made mean that few come to market so in a dynamic market environment setting a valuation can be tricky. The good news is it may be a good time to acquire something of interest.

One-off custom cars

It is even more difficult if the car in question is a one-of-a-kind. A one-off car includes custom cars and hot rods. These cars are made to the builders personal taste and will limit the market size of potential buyers to those car lovers who like what the builder did with his custom car or hot rod. What do you compare the custom car and hot rod against when considering value?

Hot Rod

Hot Rod

Ferrari Drogo GoldenCar Navarro Special NART

Ferrari Drogo GoldenCar Navarro Special NART

If the one-off car was made that way from the factory, or is a coach-built car that was built custom originally, then the valuation can be quite different than if it was customized by a subsequent owner. The one-of-a-kind Ferrari Bertone in the photo below comes to mind.

Ferrari 250 GT SWB Berlinetta Speciale

1962 Ferrari 250 GT SWB Berlinetta Speciale

If the custom car was designed and made by a famous car person, like a car designer, then the value will reflect that persons following and status in the car world. This explains the $16.5 million auction price of this Giugiaro designed Ferrari.

Or, if the one-off car is a factory prototype of a popular car model like the Porsche 911; the Porsche 901 Prototype owned by my friends Don and Diane Meluzio, for example. This is essentially the oldest Porsche 911, one of the most popular sports cars of all time.

What’s it worth? I don’t know but “a lot” doesn’t seem like enough.

Porsche 901 Prototype

Porsche 901 Prototype

Lancia Aurelia B20 GT

Lancia Aurelia B20 GT Hot Rod

Special history cars

Liv Tyler Jaguar

Does celebrity ownership, like Liv Tyler, increase the value of a classic Jaguar?

“Special history cars” are those examples that have something unique in their history that could impact the value. The most obvious category of “special history cars” (excluding race cars) is the ownership history.

Was the car owned by a famous person like, oh say, Steve McQueen? Depending on who this special person was, or is, then the value could be effected a lot or not at all.

The other question comes up is when one of these special history cars sells does it effect the value of other examples of the same model that do not share the special history? An example is the Steve McQueen 1976 Porsche 930 Turbo Carrera that sold at auction in Monterey in August 2015 for several times the value of this model without the McQueen ownership. Did this sale increase the value of other Porsche 930 Turbo examples?

 
 
 

Porsche 911S

The Steve McQueen 1970 Porsche 911S sold by RM in August 2011 for $1,250,000 USD

Original or Restored?

Classic cars of a specific marque and model are easier to value because there are more people who know and like them and there are more comparable sales to use to help set the price (like Corvette, Mustang or Camaro compared to Monteverdi or Iso). There is also a baseline of condition – originality – this sets the standard for all the examples made of that model. Using comparable sales prices is important in the collector car market (when possible) as it is in the real estate market.

To help with understanding the market values for certain models use all the information you can get: car clubs, market price guides (Hagerty Price Guide and Sports Car Market Pocket Price Guide are my favorites) and the asking prices of similar cars for sale now all can provide useful information.

With the trend in the collector car market strongly going toward originality then determining if a car is really original is important. The question of how much originality is important too. What if the paint is new but all else is original? Or some of the paint is new and some original? What if some components have been changed but many are original?

Valuing these cars is more complicated than before. The recent price differences between original and restored make these questions very important from a financial point of view.

It really doesn’t change the car in question, however. The car is right in front of you and if you drive it and like the drive and the looks and the condition then maybe it is not important to you.

The value could vary quite a bit in the future depending upon the answers to these originality questions but if you like the car that helps if you pay above current market price.

Reimagined cars, or remanufactured cars

The Singer Porsche is the first one I think of in this category but there are also companies making Shelby Mustang replicas and standard Mustang replicas to the customers specification. Plus there are many other companies making modified versions of popular cars like Simpson Design.

Singer, which designs and produces “meticulously restored and optimized air-cooled 911” is an expensive alternatives to the Porsche 911. They are popular – the big question I have is will they appreciate or even hold their value as a collector car?

Singer Porsche

Singer Porsche

Simpson Design Italia 3 GTZ

Simpson Design Italia 3 GTZ – photo from Simpson Design

Can you pay too much?

If you really like a certain rare car, have been searching a long time and you come across the perfect car (for you) but the price seems a little high – what do you do? If you plan to keep it for a long time and enjoy it then it is quite possible that the high price now is not so high in a year or two. If you pass up this perfect example you may not see another one for a long while and then the price will be even higher.

Sometimes paying too much is the best thing you can do.

Let us know what you think in the Comments.

 

 

This Raymond Loewy custom Jaguar XKE, below, will not carry near the price tag of the Giugiaro Ferrari shown above. The fact that it is a Jaguar as opposed to a Ferrari is only a small part of the reason.

Raymond Loewy XKE

Raymond Loewy Custom Jaguar XKE

1957 Gatto - Ferrari Hot Rod

1957 Gatto – Ferrari Hot Rod custom by Steve Moal

All photos, except the Liv Tyler image and the Simpson Design image, are by Mike Gulett. A version of this article was originally published in November 2017.

Summary
How Do You Value A Collector Car?
Article Name
How Do You Value A Collector Car?
Description
There are many variables that go into valuing a collector car. It is important to do your homework before you buy or sell.
Author

Comments

  1. Ken Phillips says

    There is another factor in the price equation for any rare collectable.
    It is an alternative for any of the world’s currencies.
    There may have been no special love for the 14 Million dollar Ferrari ( I think our 250 LM cost about 18 thousand ) or the recent 600,000 dollars for a Yenko Camaro, or 400 Million dollar ( 4 Times the estimate) just recently paid for the questionable Michelangelo painting.
    Or 9,000 dollars for a Bit Coin.
    Are these prices a joke?
    Or are they a Tulip ?
    Well, with the tulip at least they got a tulip.
    With the Ferrari they got the physical Ferrari.
    With the Yenko, the painting they got at least something rare and PHYSICAL.

    With the Bit Coin only some degree of CONFIDENCE.
    Is that the joke?
    Or is it the dollar, Euro, Yen that have only the CONFIDENCE of the people of the world
    that are the joke?

    When you see the prices if all these things you are seeing real people making their decision on what is their answer answer

    • Diamonte Randal says

      Ken,
      I agree with you on this point. When central banks can create money out of thin air (quantitative easing) money printing, something like 19 trillion from 2008 on, the currencies are ALL losing value. In this environment the knowing look for real assets like art, collector cars, real estate, etc.

      I see this trend continuing and the real treasures in the collector car will still do well as an end result.

  2. Pride of ownership. Now there’s something that drives the purchase price. Having the car of your dreams doesn’t have a fixed point. Some days its everything you’ve aspired to and other times it’s the emotional craving behind the human impulse in the scheme of things. Different people have different rationales for purchasing but in the end the car their buying is a mirror image if who they are in the world never mind it’s a car it’s their reflection and their views about where they line up. Just consider the teenager receiving his drivers license and driving alone for the first time. That’s where the thought process begins.

  3. I have a soft spot for Phils thoughts on this question. Essentially, what is ‘value’?
    My toy is the car of choice for my best mate back in school days, 15 years old and full of bluff and bluster. My choice was an Aston DB5. James Bond; cool, tough, always got the bad guys and the girl.
    His was faster, sleeker, cooler and altogether so much more the dream machine, except I couldn’t admit to that (remember “all bluff and bluster”). But, it became my secret dream car and 40 years later I owned one, still do. The dollar value ascribed to it rather devalues the emotional value I hold of my friend Steve (who died 60 years before his time). Similarly, the purity of line and length, curve and contour that brings to mind the lines from Littlefeat;

    Got the shape I love to squeeze,
    looks that bring me to my knees
    Oh please, let it roll tonight

  4. Speaking of Little feat,…… A song I love with lyrics for every petrol head, “Those Feat’ll steer you wrong sometimes”.
    https://genius.com/Little-feat-those-featll-steer-ya-wrong-sometimes-lyrics
    Try and hold the speed below 70 when you’re cruising through New Mexico or West Texas with this coming outa the speakers at 90% full volume. Ahhh, the joys of road tripping.

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