The rise in used automobile prices and inventory scarcity has many enthusiasts wondering are classic cars a good investment. While it’s true that some collectors can earn a fortune selling their prized possessions, others are not so lucky. Here’s what you should consider before trading in your 401k for vintage vehicles:
Make and Model
Old cars look cool, but not all of them are worthwhile investments. For example, buying a mint Chevrolet Corvair won’t give you the same ROI as a Plymouth Barracuda. Collectors ultimately want to spend their money on rare vehicles in new condition. Make sure the car you buy is still in hot demand.
Cost to Restore
Restoring vintage cars is an investment in itself. Before buying a vehicle, have a mechanic inspect it. Too many trips to the auto shop will reduce how much you’ll profit. A good rule of thumb? Steer clear of any ride that needs extensive repairs. The cost to fix a car should never exceed its value.
How much will it cost you to source OEM seat covers for a 65′ Porsche 911? What if you need a replacement engine for a VW Beetle? You might have to dig deep into your wallet. Some parts are more difficult and expensive to find than others. Make sure you won’t spend a fortune on parts before investing in that coveted vehicle.
Car restorations can take months, if not years, to complete. Think about how many hours you’ll labor over a hot engine. While it might sound like a fun hobby, your time is valuable. Consider how much time you’ll spend fixing up a classic car before buying it. The most profitable vehicle investments are the ones that take the least amount of time to restore.
Hobby or Retirement Plan?
Are project cars the new stock market? Unlike new cars, which depreciate as soon as you drive off the lot, classic cars tend to grow in value. But it can take a decade or
more to reach its fullest potential. As long as you have time to wait and don’t mind working under the hood, turning your favorite hobby into a lucrative investment is possible. After all, the average stock ROI is about 10 percent. But a hard-to-find and well-maintained ride can bring in an ROI of 200 percent or more!
Bid on Your Next Investment Car
Classic Vehicle Auctions is the leading place to bid on vintage vehicles. Created for car fans by car fans, our site features the top makes and models. We have automobiles at every price point and make building your car collection easier than ever. Find a car you like? Just place a bid—it’s that simple!
Are classic cars a good investment to add to your portfolio? Browse our inventory at Classic Vehicle Auctions to invest in the best classic cars.