The Quirky Investor’s Guide: Classic Cars
by Alexander Beard, on Oct 15, 2018 11:50:46 AM
Alternative asset classes might then appear to be a good place to put your money if you want to enjoy it, the most popular among these being wine. Unfortunately, the value of wine falls by 100 per cent as soon as it’s drunk.
All this might leave you thinking that you have very limited options if you want something that you will actually enjoy. Well fear not, there is an alternative – an alternative that could yield massive returns for wise investors, as well as barrels of fun.
What investment choice offered an average return of 28 per cent in 2017? You guessed it (well, maybe the article’s title gave away a slight hint)… classic cars. Wine, on the other hand, rose by a measly 3% during the same period.
However, to get the best returns, it is wise to do your research before buying. Buying any old banger isn’t going to give you great returns, although you might have a lot of fun with it!
Buying low and selling high is the basic logic behind good investments. A cheaper car that is a peach to drive is the original Porsche Boxster 986. Although only dating from 1996, they are fast becoming a modern classic. Manual versions with lower mileages are generally more attractive – their engines are not without their problems, and automatic cars are generally less attractive to buyers when the time comes to sell.
If you have slightly more money to invest, buying an Alfa Spider could be a wise choice. For around £20,000 you can get a good quality 1990-93 S4 Spider. These come with electric windows, fuel injection, power steering and limited slip differentials. Having a classic car doesn’t necessarily mean doing away with the modern luxuries we’ve come to expect. A model that would’ve been worth £10,000 in 2015 might sell for around £15,000 in 2018.
For real luxury investors who want an iconic model of car, you could buy a Ferrari Daytona for around £600,000. This might seem like a lot, but when you compare it to its successor, the 275, which sells for upward of £2m, the value of Daytonas could still have a long way to rise. What’s more, the Daytona was the last front-engined GT Ferrari designed by Enzo Ferrari himself, giving it extra value among true petrol-heads.