Are you in the market for a supercar but aren’t sure if it’s a great idea? Since childhood, many of us have dreamed about owning that perfect car, that car that turns heads and draws stares. Something that can be passed down through generations, increasing its worth with each passing year.
But is it worth it to own a dream car? After all, getting something truly special is going to be a considerable expense. And it doesn’t get cheaper from there. Maintenance, insurance, and repairs can all be overwhelming.
Investing in classic cars isn’t for the faint of heart. But it can also be a smart decision, depending on your choice.
Keep reading to learn more about the pros and cons of investing in collectible cars.
Pro: Invest in Something Interesting
The truth is most cars decrease in value the moment you drive it off of the lot. Even luxury cars are much cheaper used, even if they’ve been meticulously cared for.
But that’s not what you’ll be looking for. If you want a car that will give you a return on your investment, you’ll be looking at something unique. Something special that justifies its value.
Even buying a Ferrari isn’t a guarantee that your investment will grow. Instead, you need to find a low-volume model, something that’s even more exclusive than the brand’s standard offerings.
While that may take some effort to find, the result is that you have a one-of-a-kind vehicle in your driveway. And, unlike a 401k or stock offering, this investment will take you from 0-60 mph in a heartbeat.
Con: The Market Is Volatile
Supercars are a luxury. While they may inspire you, they are in many ways unnecessary. They offer speeds that you’ll likely never achieve and more power than anyone needs. They’re also incredibly impractical.
While those factors are part of what makes these cars so attractive when times are good, they become hard to justify when things take a turn. Like with real estate, market corrections can erase huge amounts of wealth in a moment.
The collector car market is also prone to trends. Certain models will develop a renewed interest that may only be passing. As investors from younger generations start collecting, the focus will shift, at least a little, to the aspirational cars from their youth.
This can be seen with Japanese sports cars. Models like the original Toyota Supra were once achievable to many people. Now, pristine models can command high asking prices due to their rarity. Whether these values will hold remains to be seen.
Pro: History Is on Your Side
While market trends ebb and flow, the longterm trajectory on collectible cars has continued to climb upwards. There may be periods where margins are thin, but given time, history has shown that the right car’s value will recover.
There’s also a correlation between the age of a vehicle and its worth. If you look at the most expensive cars sold at auction, only one out of the top 20 came after 1990.
While new cars from manufacturers like Bugatti and Pagani sell in the millions, that owes more to their exclusivity than collectibility. It will take years to see if they hold their worth.
Better is to select from something that’s proven to increase in values over time. There’s something about a decades-old car that looks factory new that seems to capture the imagination.
Con: The Purchase Price Is Just the First Expense
When you buy a piece of art or jewelry, you own something unchanging. Its simplicity means that, as long as it’s properly cared for, it will remain the way it is.
A car isn’t like that. As a sophisticated piece of machinery, it’s comprised of many different parts that can deteriorate with age. Not only that, but the act of driving is a violent one. It puts stress on the different components and can break down materials.
If you’re thinking about investing in a sports car you need to be prepared to pay for upkeep. Even if the vehicle is going to be stored, it needs to be drained of fluids and treated. It needs a climate-controlled environment to house it, requiring you to dedicate permanent garage-space to it.
If you intend to drive it, you need to be even more mindful of maintenance costs. Depending on the vehicle’s age, spare parts may no longer be available. That means you’ll need to have pieces specially fabricated.
Needless to say, these costs add up.
Before buying a collectible car, you need to factor into your budget all these other expenses. Because unless your car is treated like the investment it is, you’ll end up losing money in the end.
Pro: Enjoy a One-Of-A-Kind Driving Experience
Much of the above deals with the car’s value. As an investment, that’s an important consideration. However, it would be tragic if we failed to acknowledge what makes these cars worthwhile in the first place.
In each case, they were meant to offer a superior driving experience. These aren’t daily drivers. They’re purpose-built for performance, speed, and handling. They offer an opportunity to command brilliantly engineered machines beautifully styled.
That’s why we fall in love with them in the first place. So, whether they’re saved for Sunday mornings or carefully taken around the track, they need to be enjoyed.
Just don’t get carried away. These cars aren’t to be driven like any other vehicle. Take the time to learn how they move. Take lessons to learn more about advanced driving techniques. Treat them as they should be treated and drive them like they were meant to be driven.
Final Thoughts on Collectible Cars
Choosing where to invest your money opens up endless possibilities. There are options that offer high rewards at great risk, or choices that protect your money with mild growth.
But if you really want to put your money somewhere special, investing in collectible cars is for you. Not only can you get a great return, but you get to enjoy a truly special car in the meantime.
Visit the rest of our site for more articles on knowing what makes a car great.