Classic cars. Everyone loves them. There’s something special about their craftsmanship and nifty appearance that makes people go crazy about them. Because classic cars are so popular and in-demand, you may wonder whether purchasing one is a solid investment. So is buying a classic car a good investment?
Are Classic Cars Good Investments?
The verdict? It depends. The market for classic cars is historically volatile. One day, a classic can sell for millions at an auction. A few years later, the same make and model sells for a pittance. But if you’re willing to ride out price fluctuations and patiently wait until the value of your classic hits a sweet spot, you can make a hefty profit.
As of right now, the classic car market isn’t in the best of shape. Recent economic issues have made people hesitant to spend big on classics. Classic cars are selling for relatively cheap. But all signs point to a big upsurge in coming years, which makes this a great time to buy low so you can profit later.
Factors To Consider
Are you thinking about purchasing a classic car as an investment? Before you buy, here are a few things to consider to ensure your investment is profitable.
Short-Term vs. Long Term Ownership
Classic cars aren’t viable short-term flips, so if you want quick and easy money, classics aren’t for you. But if you can be patient and hold onto the car for a while, you could make a sizeable profit down the road.
The Kind of Car
The kind of car you purchase plays a huge role in how much you can expect to make.
What kind of classic car is it? Expensive luxury classics have seen substantial price drops in recent years, but affordable classics continue to rise in demand and price.
How rare is the car? The harder it is to find, the more demand there will be, and the more money you can make from it.
How old is it? Old cars need more elbow grease when restoring them to make them pretty and functional, but they’re more desirable to classic car collectors due to their age and history.
Classic Car Insurance Premiums
Like any other car, you need insurance for your classic. Insurance for classic cars is cheaper than standard insurance, but rates can vary from car to car. If rates are high, it may not be worthwhile to buy and hold onto a classic.
Risks and Rewards
Is buying a classic car a good investment? Like any investment, there are risks to buying a classic car, but there are also rewards.
Classic cars are an expensive investment. The purchase price, maintenance costs, storage and trailering fees, restoration costs, and the capital gains tax are all expenses you need to consider—and they can add up quickly!
But if you’re willing to take the risk, classic cars can be a fantastic investment. Feel like taking a leap of faith? Check out an online showroom and start looking for a classic car to turn into your future gold mine.
Van Rundell is a writer and author who specializes in transportation, travel, guidance, health & fitness. With over 10 years of experience in the industry as a driver and an entrepreneur, he has seen it all. His tone is professional but friendly with a dash of humor thrown in for good measure. In past, he has been advising, educating and writing about transport for the public and professionals alike.
A qualified fitness instructor with over 5 years’ experience as a personal trainer and group fitness instructor, Van brings his deep knowledge of health and exercise science to his articles on health & fitness.
