The market has continued to grow throughout 2013, quashing any early fears of a bubble bursting. The market for classic car funding has certainly grown, with January 2014 producing incredible activity at a time which is traditionally relatively quiet.
To be a little more specific, when we talk about “the market” at Classic and Sports Finance, we take a number of factors into consideration.
- Volume of sales
- Volume of cars funded
- Volume of enquiries
- Feedback from dealers – activity levels, attitude to market
- Feedback from buyers – appetite to buy and sell, attitude to market
- Classic car values – the market trend. Includes auction results
Throughout 2013 sales have been strong throughout the network of dealers we work with and the attitude towards prices and transactions from both customers and dealers has been very positive. Customers are ready and willing to pay the ever increasing prices for desirable classics, provided they feel the valuation is justified. An increasing number of classic car investment and pricing indices has served to add confidence for buyers and dealers alike.
We are in a unique position when it comes to assessing the market – as an intermediary we sit between the buyer and seller on “neutral” ground. We also have an obligation to the funding institution and the buyer to get the valuation of cars correct. This also means that we see a wide variety of car sales transactions from a selection of marques and price points, and we are privy to the actual selling prices (rather than the ticket price or the “rumoured” price – a phrase we are seeing appear more an more often in the media).
Interestingly, we have seen a number of price “corrections”. These tend to reflect over-enthusiastic bidding at auctions on the the top tier of cars – typically Ferrari and Aston Martin – followed by slightly less generous results in following auctions. These corrections were reflected by a drop in at least one of the classic car pricing indices in January 2014. Generally speaking values continue to increase if you factor out the “blips”.
- Classics from the seventies and eighties continue to grow in desirability and value as Generation X turn into the next wave of classic car buyers.
- The growth in value of the very best cars from Ferrari continues unabated. Expect the growth in values for Aston Martin to decelerate and the values of classic Mercedes-Benz to increase.
- Buyers are turning to alternative vehicles and marques looking for value for money and exclusivity.
So – what will happen to the market in 2014? Interest in classic cars (and cars in general) has never been stronger. The industry itself continues to grow and with a much healthier economic outlook we expect values at all levels to increase – although this will be tempered by less dramatic increases than we have seen over the last two years.