Are exotic super cars becoming a 'practical' investment?

[~primetime~]

Over the past 5 years car collecting has become a huge trend. Values of older cars have gone through the roof. Article on that. (http://jalopnik.com/this-is-exactly-how-insane-the-collector-car-market-is-1682005072)

I love cars in general, and I enjoy watching car auctions on TV...it's fun to see your childhood dream cars being displayed and sold, and finding out what they are going for.

So recently I got on Ebay motors to see whats going for what...it's a lot different than it used to be that's for sure.


Here is the Lamborghini Countach (http://www.ebay.com/sch/Cars-Trucks-/6001/i.html?makeval=Lamborghini&modelval=Countach&_nkw=Lamborghini+Countach&_sop=3)...these things retailed for around $200k. If you still have one in decent condition then you have doubled your money!...well, I suppose inflation would play a role here, but you would have still profited.

Diablos have also gone up in price (http://www.ebay.com/sch/i.html?_odkw=Lamborghini+Countach&modelval=Countach&_sop=3&makeval=Lamborghini&_osacat=6001&_from=R40&_trksid=p2045573.m570.l1311.R1.TR12.TRC2.A0.H0.XLa mborghini+Dia.TRS0&_nkw=lamborghini+diablo&_sacat=6001)

Ferrari Testerossa (http://www.ebay.com/sch/i.html?_odkw=lamborghini+diablo&_sop=3&_osacat=6001&_from=R40&_trksid=p2045573.m570.l1311.R1.TR12.TRC2.A0.H0.Xfe rrrari+tes.TRS0&_nkw=ferrari+testarossa&_sacat=6001)




I feel like you can now view buying an exotic sports car as a legit investment rather than a huge waste of money...:confusedshrug:

buy a Ferrari for $300k today...drive it 20k miles or so...15 years later you might be able to sell it for $400k.

[fiddy]

For the people that can afford it, probably.

[warriorfan]

https://www.youtube.com/watch?v=zcmEpKWOYbQ

[embersyc]

Your not taking into account things like insurance (Which will be sky high), depreciation (unless you park it in an airtight dry garage and never drive it, the condition of the vehicle will degrade), maintenance (which is also extra expensive on these vehicles).

A car is never an investment, sorry.

[~primetime~]

Your not taking into account things like insurance (Which will be sky high), depreciation (unless you park it in an airtight dry garage and never drive it, the condition of the vehicle will degrade), maintenance (which is also extra expensive on these vehicles).

A car is never an investment, sorry.
A lot of the people that attend classic car auctions do view their purchases as investments. That different than exotics unless we are talking very old Ferraris, but they are legit investments.

I guarantee you that Jay Leno views his collection as a legit investment and not just a hobby.

[~primetime~]

The thing with exotic sports are though, now they are viewed as 'collectibles' very very quickly. Some of them are collectibles right away as new. And they will actually appreciate in value because of that.

That is much different than a Toyota, or Honda, etc

[robert de niro]

https://youtu.be/0GIwTG8V-Ko

[Labissiere]

"practical" :oldlol:

[dazzer87]

rich just gets richer......

[Nanners]

no.

maintainence, insurance and storage for an exotic super car is going to dramatically outweigh the increase in value over time.

[Nick Young]

Buying a deprecating asset is never a smart investment.


Where do you get your investment advice dude? First twitter stock, now this? It's like the guy feeding you advice is trying to make you lose all your money.

[Nick Young]

A lot of the people that attend classic car auctions do view their purchases as investments. That different than exotics unless we are talking very old Ferraris, but they are legit investments.

I guarantee you that Jay Leno views his collection as a legit investment and not just a hobby.
:facepalm :facepalm :facepalm

Are other people in Texas like you or are you the anomaly? I swear dude, reading your posts is sometimes like reading dialogue from one of Hank Hill's dumbass neighbors in King of the Hill.

[~primetime~]

no.

maintainence, insurance and storage for an exotic super car is going to dramatically outweigh the increase in value over time.
Maybe so but these things are much cheaper than you're probably imagining because these cars are never anyone's primary car and usually only get 1-2k in mileage a year. This is negotiated when buying insurance. Set amount unless you drive more than x-amount of miles.

Perhaps it's hard to actually tien a profit, but I definitely think it has become more practical than in the past due to the collecting market.

[bladefd]

Only if you have money to take the risk. btw, antique cars are better investment than newer supercars.

[~primetime~]

Okay some math after doing brief internet research.

Insurance on a $200k Ferrari driven less than 3k miles a year looks to be $7-$9k a year.

Maintenance on a Ferrari is expensive, a major service (every 3-5 years) is anywhere from $3k to $7k... With annual expenditures of $1k-$2k

So for a decade the insurance would be $70k-$90k over that time, and the maintenance would be anywhere from $16k to $48k in that time.

The low end would be $86k a decade, high end $138k.


So, in 10 years time your $200k Ferrari that you drive less than 3k miles a year would have to appreciate at least $86k to break even. That does seem very unlikely, but maaaaybe doable.

I'm thinking of you only drove 1k miles a year it would probably cut these expenses in half, so if you really limit your driving you may then be able to turn a profit.

[Nick Young]

Okay some math after doing brief internet research.

Insurance on a $200k Ferrari driven less than 3k miles a year looks to be $7-$9k a year.

Maintenance on a Ferrari is expensive, a major service (every 3-5 years) is anywhere from $3k to $7k... With annual expenditures of $1k-$2k

So for a decade the insurance would be $70k-$90k over that time, and the maintenance would be anywhere from $16k to $48k in that time.

The low end would be $86k a decade, high end $138k.


So, in 10 years time your $200k Ferrari that you drive less than 3k miles a year would have to appreciate at least $86k to break even. That does seem very unlikely, but maaaaybe doable.

I'm thinking of you only drove 1k miles a year it would probably cut these expenses in half, so if you really limit your driving you may then be able to turn a profit.
you planning on driving this "investment" of yours and you expect it to appreciate? Are you serious?


If you want to buy an exotic super car to drive around then do it, but don't pretend it's an investment.

[~primetime~]

Many of these cars are appreciating Nick, not depreciating...try reading the OP, click the links

Countach with 20k miles going for $500k now...MSRP was $200k

[Nick Young]

Many of these cars are appreciating Nick, not depreciating...try reading the OP, click the links

Countach with 20k miles going for $500k now...MSRP was $200k
not if you drive them, fool.:facepalm

[KNOW1EDGE]

No.

They are still a horribly impractical investment, just like they have alway been and will always remain

[~primetime~]

They are appreciating with mileage Nick.

Granted, not much mileage.


But, 2k miles a year is more than it sounds for a car like that, it would basically just be driving it on weekends only. That's the norm though.

[Nick Young]

They are appreciating with mileage Nick.

Granted, not much mileage.


But, 2k miles a year is more than it sounds for a car like that, it would basically just be driving it on weekends only. That's the norm though.

Spend your money how you want to. I'm just telling you the truth. It is good for you, even if you don't want to hear it.

What happens to your investment if it gets nicked or in a crash?

[macmac]

With 200k in capital you should easily be making 6-10% a year on guaranteed investments.

Those classic cars are great because you can collect and drive them as a hobby and not lose or even gain some money while doing it, similar to collecting high end watches.

There's actually good money in collecting single malt scotches tho, I've been stashing 25 and 30 yr Mcallans they've stopped making. You can be looking at gains of 10 to 15% a year on limited edition scotches in high demand

[~primetime~]

^^^ yes you wouldnt make anywhere near 6%

BUT....I feel like just breaking even would make it "practical" given that you couldn't do that with normal cars and the masses are losing $$$.

[9erempiree]

Very risky.

[~primetime~]

You could probably make 6% on the limited edition stuff Ferrari and Lambo release.

Lambo just made a limited 40 car series that sold for $2m each before they were even made. They'll probably be worth $4m in 20 years.

[Jasper]

Living in Chicago , I had my eye on a Ferrari that was a 60's GT but could not afford at the time the price tag.......
Long story short that car is 10 times what it was worth then :D

You have to have the money to buy and keep the long term investment under wraps for a long time.


You would be better off , buying a lake lot or land , even from a broker , and pay off the land as a savings account , and sell for a 10% increase , and act as if it was a 'savings bond'
They don't make land anymore :D

[Nick Young]

^^^ yes you wouldnt make anywhere near 6%

BUT....I feel like just breaking even would make it "practical" given that you couldn't do that with normal cars and the masses are losing $$$.
It would be the opposite of practical. If you want to buy a fancy sports car just do it. No one with a sound mind is going to tell you it's a sound investment though.

If you want the fancy car, you don't need to make excuses and justifications. If you think it's the right thing to do, and feel like it's a quality investment, then just buy it and prove everyone wrong and enjoy driving your fancy car around.

YOLO

[9erempiree]

If you think about your supercar as an investment then that would be taking the joy out of driving it.

Like Nick mentioned, you get dings and chips on your investment.

It's better to admit that the purchase is for the sake of the driving experience than some investment.

[KyrieTheFuture]

What was the point of asking the question if you disagree with everyone who says no.

[~primetime~]

I didn't disagree, I broke down the math myself and concluded it would be difficult to profit, you would have to drive less than 1k miles a year.

Just wanted to discuss the topic, see thoughts

[embersyc]

I guarantee you that Jay Leno views his collection as a legit investment and not just a hobby.

:wtf:

First off, Jay Leno has no need to invest. It is a straight up hobby for him, besides the dude could open up his garage as a museum if he wanted to. I'm sure Leno employs a staff of people to take of those cars.

If Leno wrecks a car, or something depreciates, it's not that big of deal to him, he got a lot of those cars as gifts anyways.

[~primetime~]

^^^ I absolutely guarantee you that he views his collection as a legit investment and a huge part of his estate/net worth

I also guarentee you that his collection is worth more than he has put in, given all his rare antiques, even w/full time staff.

Obviously it's his love and passion, but still a large part of his estate.




Seinfeld just sold his Porche collection for shit ton of $$$ BTW... Probably much more than he paid

[~primetime~]

http://www.cnbc.com/2016/01/19/jerry-seinfelds-porsches-to-sell-for-millions.html

Jerry Seinfeld's Porsches to sell for millions

[QUOTE]
It's likely that Seinfeld's cars will sell for far more than he paid for them

[Nick Young]

http://www.cnbc.com/2016/01/19/jerry-seinfelds-porsches-to-sell-for-millions.html

Jerry Seinfeld's Porsches to sell for millions
[QUOTE]partly because of the soaring value of Porsches in recent years, partly because of his name and partly because of how meticulously he restores and cares for his cars. [B][COLOR="Red"][SIZE="7"]A Seinfeld Porsche is like a "Rockefeller Rothko" or a "Thannhauser Kandinsky"

[Cowboy Thunder]

Moving away from the exotic super car label, but,

I think that future classic cars/more sought after models, are a much better value than run of the mill cars.


95 Impala, Ford Lightning, Supra, GNX, Cyclone, Typhoon, etc.

Really don't lose much/any value even when you drive them.

[~primetime~]

I'm not buying an exotic Nick :facepalm

[macmac]

people love to argue. Pt just discussing luxury and classic cars as appreciating assets and people swarming him lol

[Nanners]

I definitely think it has become more practical than in the past due to the collecting market.

the thing is collectors markets are really volatile and unpredictable. remember when baseball cards were super valuable? lots of people thought baseball cards were a sound investment, and for a long time they were... but then the bottom fell out of the collectable card market. the super car collectors market might seem strong right now, but that could rapidly tank for a wide variety of reasons.

an exotic supercar will always be a "fun" investment but will never a "practical" one. if you want a practical investment get a well diversified investment account.

[~primetime~]

people love to argue. Pt just discussing luxury and classic cars as appreciating assets and people swarming him lol
It's pretty much just Nick

It's like a retarded child running wild in the thread, but thats pretty much the norm in ISH...mod free posting

[~primetime~]

the thing is collectors markets are really volatile and unpredictable. remember when baseball cards were super valuable? lots of people thought baseball cards were a sound investment, and for a long time they were... but then the bottom fell out of the collectable card market. the super car collectors market might seem strong right now, but that could rapidly change for a wide variety of reasons.
This is true, the fine art market is also going ape shit right now and 10 years from now it may not be.

I don't think these markets will actually reverse in value like card collecting though.

Speaking of cards, I did see that the really high end cards, like the Wagner, have still been increasing a ton over the years. Gretzky bought for $1m I think, now its worth much more.

[Cowboy Thunder]

the thing is collectors markets are really volatile and unpredictable. remember when baseball cards were super valuable? lots of people thought baseball cards were a sound investment, and for a long time they were... but the bottom fell out of the collectable card market. the super car collectors market might seem strong right now, but that could rapidly tank for a wide variety of reasons.

an exotic supercar will always be a "fun" investment but will never a "practical" one.


I've often wondered what would happen to the classic car market if the environmentalist put even heavier restrictions on emissions.

[Nanners]

This is true, the fine art market is also going ape shit right now and 10 years from now it may not be.

I don't think these markets will actually reverse in value like card collecting though.

Speaking of cards, I did see that the really high end cards, like the Wagner, have still been increasing a ton over the years. Gretzky bought for $1m I think, now its worth much more.
i tend to agree that the car market probably wont reverse (especially with the coming dawn of the electric and self-driving car, cars are going to change a lot in the not so distant future). that said there is always chance that it does reverse, and if it does you could be royally ****ed if you happen to be holding a special edition ferrari or whatever.

wagner is like the holy grail of baseball cards. i dunno what the car equivalent would be, original shelby cobra or something... if you can get one of those its probably a safe investment :D

[Nanners]

I've often wondered what would happen to the classic car market if the environmentalist put even heavier restrictions on emissions.

my guess is that would probably strengthen the market if anything.

environmental restrictions are rarely retroactively, any new restrictions would likely only apply to newly made cars. so if some crazy new restrictions come out, that would probably just increase the value of any notable cars made before the restrictions.

[~primetime~]

wagner is like the holy grail of baseball cards. i dunno what the car equivalent would be, original shelby cobra or something... if you can get one of those its probably a safe investment :D

http://www.autoexpress.co.uk/car-news/88249/most-expensive-cars-ever-sold-at-auction

Top-10 all Ferrari...one Benz

Classic Ferraris go for retarded amounts