Just an idea: Classics that won't depreciate

I came up with an idea the other day and I want you guys to tell me if I am crazy or not. Would it be feasible to "invest" $15k or so into a car of any vintage and turn it over in a couple of years and at least break even? My thought is to have a fun car that my wife and I would enjoy, but have the option to change it up and try something different every few years. Say go with a TR6 for a couple of years then trade and get a Cadillac Coupe deVille, and so on. Obviously, the cars would be well sorted from the get go, so not much work outside of regular maintenance would go into them.

Eh, whatever, I was bored and was curious as to what the esteemed minds here at GRM thought.

Short answer, yes. Long answer, depends.

Like any commodity the market fluctuates. Some cars are more stable, others are volatile.

Generally I have been able to at a minimum break even on most of my toys, but I usually invest time in making them better than what I started with.

Some cars just naturally retain value, some are on the verge of and upswing and some are going downhill. Its no easier to predict than the stock market, but its a hell of alot more fun to drive a classic than look at a stock. Buy something you really want and will enjoy and hope the market bears it out.

911.

I bought my '88 MR2 SC in 2000 for $3k. Four years and 25k more miles later I sold it for $4k. True, I put in about $1k worth of updates over the years but all in all a free car for 4 years.

Miata (somebody had to say it!) 93LE or 10AE.

Done just that with numerous Miatas.

air cooled 911

3rd gen RX7 - although the wife won't like that much

BMW E30 M3 or E36 MC3 or Z3 M Coupe

I have been watching the MR2 Spyders. The first year (2000) is now 11 years old which should be the sweet spot where they are just old cars. Some deals are out there but prices seem to be staying rather high.

A clean bmw 2002ti is a pretty solid bet. Rust, neglect, and abuse will put some into the scrap yard. It will be the car people say, "I always wanted one of them!"

Finding a good FD might be an issue, but it should keep prices up for good ones.

I'd certainly include the E30 M3 in the list and I'd probably also add the Acura NSX - prices for good, unmolested examples of these seem to be pretty stable in the last couple of years.

A good plan might be to buy a good, unmodified example of a car you lusted after when you were in your teens or early twenties and keep it for a while.

I have a friend that has told me he hopes to do that with and Espirt he bought--really clean for a great price. Drive it for a couple of years, fix what inevitably breaks, sell it for what he paid.

Well, ideally you'd probably want to sell for a little more than you paid for it to factor in inflation so you can get your money back...

Lotus Elan +2 - I think they are due for a jump in value.

Definitely doable. AC 911s, alfa GTVs... I'd try for something above the lower end cars like MGBs - they seem stuck on the low end - perhaps something more limited in production. A few years ago you could regularly find porsche driver 356Bs around 15k. Prices seemed to have taken off. There's a really nice TR6 on BaT for 13k. The classic mags and Hagerty usually have a list of cars to watch for the future.

Just watch maintenance expenses or hidden surprises.

BoxheadTim wrote: A good plan might be to buy a good, unmodified example of a car you lusted after when you were in your teens or early twenties and keep it for a while.

This: Speaketh the heart of today's "recent" cars to collect.

Shelby Dodges built in the Whittier plant '86-'89.

1965 to 1969 Porsche 912 -- $15k would get a real nice (but not perfect) one and prices have been going up slowly for the last 20 years. They used to cost less than clapped out Boxsters but not any more.

They handle a bit better than 911s from the same era, are super lightweight, and the engines are carried over from the 356 and are simpler to keep going.

Don't forget the wear and tear you place on the vehicle. If you're the type who adds dents and scrapes, factor that into your math.

I have 3 depreciation-free vehicles: my Mini, my E30 and my tow vehicle, the '65 Ford F100. I'd probably throw in my open car trailer too. I bought low on all of them. Good solid driver quality vehicles (except for the BMW). The paint isn't concours, but it's good enough for the local car shows and 80% of the future buyers out there. I give them all tasteful upgrades (wheels, exhaust) while retaining the stock character. The BMW is now a race car, so it's not really a good argument, but if it were a street car with the same formula applied it would go with the other two in being worth slightly more than I paid for any of them several years later. So yes, it's absolutely possible.

Now, none of them are daily drivers. I live in the northeast, where they like to use salt, so that's simply impossible from a preservation aspect. But if you're talking hobby car, absolutely you can pull that off. My intention with the Mini was to keep it a few years and then sell it for another car on the bucket list, but like a lost puppy, it's kind of hard to get an urge to sell it off now. That's the only potential problem to the plan--you wind up liking one too much.

ddavidv wrote: That's the only potential problem to the plan--you wind up liking one too much.

Yup... 5 years ago I bought a crusty '73 1800ES with the intention of parting it out... then I made the mistake of getting it running and driving it a bit. BIG mistake. Now it sits waiting for me to build a shop so I can restore it.

A similar plan my g/f and I have is to look at whatever the featured marque is at the Watkins Glen Vintage Festival, then buy a can that needs minimal work so as to take part in the Tour de Marque, then sell it afterwards... The marque for 2011 is Datsun, so we've been casually looking for one, however time is a serious issue for us (wrenching time for me) right now, so I'm not sure it will happen this year.

Honestly, and I'm being very brutal here, if you have not done your homework, and found the cars that are not depreciating, you should NOT invest. Cars are not an investment, they are a tool and a toy. The fact that one can take advantage of their cost ends up being secondary.

IMHO, if all you are looking for is financial, you will probably lose.

There are a TON of cars out there in the $15k range that do not lose or increase value. Virtually all of them are becuase someone has an emotional attachement to the car.

Do your homework, just like stock investing.

That's what I've done most of my life, with a few exceptions. I always paid cash for cars, drove them until I got bored, sold them for close to what I paid and moved to the next car. Works like a charm unless you pick one that needs a lot of work. Or unless you buy an Alfa and then the garage, yard, friend's houses and garages all seem to fill up with them. I had 8 at one time and friends stopped returning my calls!

Tough question. 1976 I bought a very limited edition guitar as an investment for $475 (big dollars at the time) It was worth $2500 in 2008, sold for $800 in 2010. Timing in everything in this situation.

If you buy and sell well, any number of cars 20 or more years old should hold value or even appreciate. My wife had a very nice '78 L-82 Corvette that she got in and out of right around $12k. She had it maybe 7 or 8 years, and put a few new parts on it, but nothing major. She also probably paid too much for it.

With the recent downturn in toy prices I would think you could snap up a bargain. The key would be finding an honest car with no major issues. Just don't venture towards the obscure, and be aware of what the market is for the cars you choose.

This is sort of my plan when looking at 911 SC's or Carrera 3.2's; enjoyable cars that don't seem to be getting any cheaper that are modern & somewhat rust resistant that I won't worry about depreciation so much. I'm not doing it as an investment but more of a cost savings of not watching the car continue to devalue.

Which will be a drastic change from my Olds Intrigue; purchased for 1/2 it's sticker only 2 years old, it now has a trade in value hovering in the $1200 area. Just reducing that sort of value loss seems like the best a person could hope to do.

p.s. I plan on doing a yearly Dinitrol or similar treatment myself and inspecting all body seals, sunroof drains, etc etc to try and keep tinworm at bay. Rust can still kill values.