It's not good news for those of us who already have a garage full of Classic Cars, but as Matthew-Wilson points out, our labour of love may end up stinging us in the tail.
“With the current economic turmoil, people are looking for safer investments, and some are buying up classic cars in the hope that these vehicles will gain in value. My advice is: don’t”
“There’s a widely held myth that classic cars never lose value and often increase in price. This is basically crap. People who invested in classic cars before the 1987 stockmarket crash generally lost heavily on the deal. In some cases their vehicles dropped in value by as much as three quarters.”
“Already American classic car collectors are taking a bath. In March of this year, the Wall Street Journal reported that the prices of many desirable classics had dropped by a third. By now I’m willing to bet that some of those cars will have lost half or two thirds of their value.”
“Even the upmarket classics like Ferraris are not immune. These cars tend to be bought during good times by people who have grown rich due to speculation on property or shares. When these investments drop in value, rich people suddenly aren’t rich anymore so they end up having to auction off their cars for far less than they paid for them. The situation is already bad and it’s going to get far worse.”
Matthew-Wilson, who has been restoring classic cars for over twenty years, says that people should buy classic cars because they love them, not because they want to make money from them.
“For many classic car enthusiasts, their car is a part of their family. However, most owners will privately admit that they’ve spent far more on their classic than they could ever hope to get back by selling it. If you take a classic wreck and fully restore it, you can expect to recover between one quarter and one third of the money you spent on it, not including a few thousand hours of your own labour.”