e34 M5 - what to watch out for

My neighbour down the block has a fantastic looking e34 m5 (I'm guessing it's a '92) for sale. It has the throwing star wheels and the body is mint. I've owned e30's for 15 years now and have concentrated all of my 6 brain cells to knowing everything about them so I know practically nothing about the e34.

Besides the regular basic used car stuff, what should I worry about. I had heard the early M5 engines need a new timing chain at the 100K mile mark (which should also included a head rebuild etc.)

I don't know the mileage as of yet, I'm going to get the details tonight.

Any help is appreciated, thanks!

Don't know much about them, but know the car below is for sale by a good guy, here near me in N FL. If nothing else, good comparison for you. He is asking $10k.

http://www.m5board.com/vbulletin/sale-wanted/171236-1991-e34-m5-jet-black-black-n-florida.html

MODEL E34 M5
MODEL CODE HD93
VIN WBSHD9311MBK05913
PRODUCTION DATE December 1990
COUNTRY OF ORIGINAL SPECIFICATION United States
EXTERIOR COLOR (PAINT CODE) Jet Black (668)
INTERIOR COLOR (UPHOLSTERY CODE) Black Nappa leather (0226)

FACTORY/OEM OPTIONS
BMW CD Changer, Heated Front Seats
ADDITIONAL EQUIPMENT + COMMENTS
A European Delivery example. Purchased in 4/2010 with 174,000 miles. Currently equipped with TMS performance chip, H&R springs, Bilstein Sport shocks, UUC Evo3 short shift kit (w/DSSR), M System II wheel covers, M-Technic side mirrors.

IIRC the main problem area can be either the engine or the suspension - fixing the electronic suspension (I think it's called the 'Nürnburg' suspension or something) is mega-expensive simply due to the cost of the parts.

The 3.6 engine is pretty bullet proof if it's been maintained correctly and supposedly outlasts the later 3.8, which doesn't quite like to rev the way it is supposed to all the time; instances of rods existing the block have been seen, but I believe that was at quite high mileage.

Other than that, I think they're mostly E34s and thus fairly easy to look after and fix.

i do heart the E34 M5, but if they really go for $10k, I can't see any reason to not spend a few more and get the E39 M5.

if market said $8k, i'd probably get the E34 because i like the styling better.

I think the market for these is DEFINITELY trending to the 8k direction...at the moment. E30 M3's used to be cheaper too, though I'm not sure the E34's will ever enjoy the same status. The E39 tugs at my heart more (the extra ~100ish hp helps), but is somewhat more money---though these can be found in decent shape for ~13k. I came VERY close to this route before deciding an E46 was a better option for us as a family car.

The big fear is usually that the S38 motors are expensive to get parts for: this can be mitigated using non OE parts IF a rebuild becomes necessary. There are lots of these with 200+k miles with untouched bottom ends.
Solid lifter design needs valve adjustments which require shims and a tappet tool (~$200). I'm told burnt and/or broken valves happen if this isn't done. The head and associated parts aren't cheap, but used examples are out there. Not all E34 M5's had the expensive electronic suspension...

The chassis' are solid, and age well: I've driven crashed examples that were remarkably solid and rattle free. We have a non-running E34 M5 in the garage, awaiting my attendance - it's quite enjoyable to work on, and the engine is lovely.

I think you can still rent a valve adjustment kit from somewhere - it consists of the tool along with a box full of a selection of shims; you adjust the valves, put any shims you took out back in the box and then pay for the ones you used. A bunch of the local M5 guys here had a valve adjustment party a few years back, so when the rental cost was spread among everyone it was pretty inexpensive. The actual adjustment task is fairly simple, once you have the tool.

Chances are most e34 M5s have had the load leveling suspension replaced with regular Bilsteins by now. If not, it's a common procedure.

The e39 has that big V8, but the straight six in the e34 is a really sweet engine. Plus, they have better build quality and a lot less electronics to fail as they age.