December 6, 2023

Classic Car Values: Are They On The Increase?

We came across a report/survey by The Classic Valuer which looked at the prices for classic cars nowadays. Is they a good investment? Here’s the take from the team at White’s Bodyworks

Contrary to widespread belief that the Covid-19 years were going to be a golden era for classic cars, data from Classic Valuer reveals otherwise. The boom that was anticipated during those years didn't materialise as expected. However, a real surge is happening now.

Prices have soared by 22.5% in 2023 compared to the previous year and an impressive 29.0% over the last five years. Despite concerns about a potential recession and rising living costs, classic cars have exhibited remarkable resilience and even outpaced inflation. That’s good news if you are an investor or have a gem hidden away in the garage.

This could be all about supply and demand. In the first half of 2022, the market witnessed a record number of cars going up for auction. In contrast, the first half of 2023 has seen a substantial drop in listings, down by 29%. When supply decreases, all other factors being equal, prices tend to rise. This could have played a significant role in the current price surge.

Price Trends Across Different Countries

The data from The Classic Valuer spans over 30 countries worldwide, with the majority of listings coming from the UK, US, and the EU. When breaking down the data by country, an intriguing pattern emerges.

In the United States, median prices have surged by 32.6% between the first half of 2022 and 2023. The UK also shows positive price growth at 11.1%. In contrast, the EU has experienced a price decline of 5.7% compared to 2022.

What is causing the difference? Both the UK and the EU have committed to allowing the sale of new electric vehicles (EVs) only from 2035. While this primarily impacts the sale of new vehicles, survey data indicates that it's affecting the mindset of classic car enthusiasts. The US, on the other hand, has taken a more relaxed approach, although certain states like California have implemented their own targets for the sale of new internal combustion engine vehicles.

A stronger and healthier economy tends to boost asset prices, including classic cars. The US has consistently outperformed the UK and the EU regarding GDP growth in recent years. In Q1 2023, the US economy was 5.7% above pre-pandemic levels, while the UK's economy remained 0.5% smaller than its pre-pandemic size. Naturally, these economic disparities influence classic car prices. The age of the vehicle also plays a role.

Price Variations by Vehicle Age

  • The 1970s continue to be the best-performing decade, with prices increasing by an average of 65% since 2019.
  • In contrast, the 1920s and 1930s are the weakest-performing decades, with prices declining by approximately 10%.

Firstly, the traditional metric is the sell-through rate, which represents the percentage of vehicles that go to auction and successfully sell. While it has its limitations, including over-enthusiastic or pessimistic estimates from auction houses and the influence of variables like auction location, it still provides valuable insights. Over the past years, the sell-through rate has fluctuated around 72%, with a gradual overall decline of less than 1% per annum.

5 Ways to Boost the Value of Your Classic Car

Of course, your classic car will not maintain its value if you don’t look after it. Here are some top tips from White’s Bodyworks.

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Owning a classic car is a dream for many people. There's something special about driving around in a car made before your parents were even born. If you're lucky enough to own one, you want to ensure it's worth as much as possible. Here are five ways to boost the value of your classic car.

Keep Up With Maintenance and Repairs

Regular maintenance and repairs are essential for keeping your classic car running smoothly and preserving its value over time. Regular oil changes, tune-ups, and other general maintenance should be performed regularly to help ensure that your car is running optimally. This can also help diagnose problems before they become more serious.

Any repairs should also be done promptly, including bodywork for dents and rust spots and any mechanical repairs that may be necessary. Neglecting to perform regular maintenance or repairs can lead to further damage and drastically reduce your car's value.

Stick to the Original Parts

For collectors and classic car appraisers, nothing is more valuable than a vehicle that remains unaltered from its original form or has components of the same period. Classics with untampered parts are scarce and, therefore, highly sought after by collectors that seek true value. This makes them far more valuable than those vehicles restored to new condition with replacement components or accessories.

If you need to replace any part of your car, take the time to find an authentic replacement part from the same manufacturer, as some parts may no longer be available and are very valuable when found.

Show Your Classic Car

Consider participating in car shows, parades, or other events in your area where you can show off your classic car and meet other enthusiasts. These events are great places to network and meet potential buyers. You may find clubs or organizations dedicated to appreciating classic cars that you can join for additional advice and resources. There are also many websites where you can learn how to install led glow interior lights or other customizations to give your car a unique look helping you stand out from the crowd and attract more attention to your car.

Document Everything

Every restoration, repair or customization should be documented in detail, including the date it was done and the cost of any parts or labour. This information can prove invaluable when trying to show potential buyers the authenticity and history of your classic car. It's also important to document any awards, recognitions, or achievements your car has won. These can add great value to your classic car and help you command a higher price when it comes time to sell.

Keep It Clean

Keeping your classic car clean doesn't just mean keeping it free from dirt and debris but also from any rust or wear that may have accumulated over time. Rust and wear can seriously reduce the value of your classic car, so it's important to address it as soon as possible.

If you're unable to deal with rust, consider taking your car to a restoration shop where professionals can remove any existing rust and coat it in a protective coating that will help prevent future corrosion. It is also vital to avoid smoking in your car, as this can cause stains and discolorations to the interior.

Maintaining the value of a classic car takes dedication, research, and attention to detail. By following these tips, you can help ensure that your classic car is preserved in its original condition and remains valuable for years to come.

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