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Automotive Engineer

Buying A Classic

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This is partially related.

So I'm thinking to buy a classic in the next 5 years or so. My planned budget is about 10k, so lots of saving to do.

Given that I'm convinced there will be a HPC sometime in the near future, is it reasonable to expect that owners of classic cars who own mortgages will sell when faced with higher monthly mortgage costs?

From what I can tell, the classic car market is awfully bubbly. Probably something to do with the low interest rates allowing people to borrow to buy stuff with money they don't have, as well as "investors" who have identified classic cars as a potential market for market appreciation. (The sort of people who do not appreciate cars, and wouldn't know how to use a spanner.)

I don't know. What are your thoughts?

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I'm guessing by your avatar name you'll be handy with spanners so ill avoid my first warning!

If it was me I'd look less at a classic and something more modern which could turn into a classic. At the moment BMW M cars of a certain vintage are appreciating well, last NA engines, 6 speed manuals etc. There will never be cars built like that ever again due to pollution regs. I'd find something in a niche and buy that. Buy something you can use too. I own one of these and mine is appreciating 1k a year, however it costs 1k to keep running!

Im also lucky enough to own a classic camper, it's 35 years old and whilst probably appreciating takes a lot of time and money to keep running. I went into it with blinkers on, don't do the same!

As to your question, for 10k whatever you buy won't make you much unless it's an absolute shit box and your willing to pour a year of your life into reviving it. I'd question unless your retired or a pervert whether that's a good decision...

I don't think there would be an exodus of owners in the event of a crash as most people who own valuable classics tend to be old and well off.

Good luck though, it's not a bad idea. Just approach with caution.

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Interesting post.

I agree that the classic car market is very frothy; cars we considered real dogs not all that long ago now fetching bonkers money. I'm sure there is a lot of investment cash piling into an asset class which is widely reported to be performing well. The other reason for the startling appreciation of 'lesser' classics is the fact that top grade cars are now the preserve of billionaires.

I'm not sure how much of the cash coming into this market is borrowed but we can see from the last downturn that classic cars are considered highly liquid and lots of them do get sold when markets turn bad.

On the other hand, if you really enjoy the car, the value matters not; car offer no yield other than the pleasure of driving them. BTW, I appreciate my cars but haven't a clue how to use a spanner. There are people who do and to whom I am happy to pay to do it.

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I suspect the classic car market might be driven in part by pensions freedoms. If you are over 55 you can cash in some or all of your pensions now (subject to tax on most of it) and there could well be lots of men in their late 50s who are doing that to buy the car they wanted as a boy.

I doubt many people are buying classic cars with borrowed money and who are also at risk of HPC, but if we see an HPC then negative sentiment will probably hit discretionary spending like classic cars. I wouldn't approach the decision to buy a classic car like that though. Can you afford it? Can you afford to keep it running? Do you like it? If all three answers are yes, then buy it and don't worry too much about whether it will be worth 20% less or 20% more in a couple of years.

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lotus Elise around your budget.

Fast, Handel well, hardy any rust issues (aluminium and plastic). New lotus are soo crazy expensive that the value of older ones has really gone up recently.

does very much seem that there is an age delay on appreciating classics. 1980's/1990's cars are just starting to go up in value (Peugeot 205 for example)

But I suspect they are not going to be as valuable longer term. just follows the adults wanting the cars of their youth.

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The classic car market is global with local distortions. Its very, very bubbly and I would expect a very serious correction when the downturn comes. Being ready to snap up a bargain when the indebted need some quick cash would be the way to go. House prices tend to be sticky downwards because houses serve a real need, however the classic car market tends to be far more volatile so I would expect it to shift quickly. I have lived through two real collapses in classic/exotic car prices and each time they have tanked.

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I have an 11 year old classic Mondeo fro £10k if your interested :-)

I actually bought it (2.0tdci) earlier this year, done a couple of DIY bits to it and it's easily the best car I have ever owned.

Try finding an early MK1 mondeo on a K plate, now they're quire rare, not that anyone would really want one. About 20 years ago I used to think that Ausin Ambassaror's would become quite rare and valuable. I was correct about the rare, but there is no demand for them because they were a pile of crap.

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I don't regard today's prices as good value and I expect to see a serious downcycle within 5 years.

'Classic' covers a wide range - Traction Avant, Austin Healey, MGB and Audi Quattro will all be classics, but many people would disregard the modern stuff.

Presumably you know roughly what you want - wait for prices to come down and buy one.

If you want to make money you have to work to the car depreciation cycle - every generation has one - cars become valueless and then (for some reason) some of them become valuable... It seems either to be based on looks (unusual / pretty) or poster-child (look at the posters 16 yr old's had on their walls, then move forward 30 years to the point where some of them have money - that will be the expensive modern classic)

At the moment - subaru wrx seem to be at the point Sierra Cosworth were at one point (chav mobiles), v6 Alfa GTV (the modern one, too expensive to maintain as a banger), maybe Renault Avantime (weird but they didn't make many).

Note that for the modern-classics-to-be they need a full recession plus recovery cycle - for the cars to become valuefull they need to first become valueless and the majority crushed.

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Don't know how you feel about motorbikes, but some oldies are getting seriously expensive - early Hinckley Triumphs, Slabside GSX-Rs, SRADS, decent old BMWs, in addition to the obvious old Brits, Ducatis and LCs. Don't take up so much space either.

djmgw

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It depends what you call a classic, have you got your heart set on something in particular? I think the suggestion of buying something that could become a classic is a good call, because then you could use it as every day transportation for a while. Something from the late 80s, 90s or early 2000s.

Personally I always wanted a 90s Mazda RX7. Easily affordable for me, but with the rotory engine a real money pit. I also like the Fiat coupe from the 90s and the last BMW 5 series (peak Bangle!!). One of the later range rover 'classics' might be another interesting call.

I think it depends what scratches your itch, but I like something a bit quirky.

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Personally I always wanted a 90s Mazda RX7. Easily affordable for me, but with the rotory engine a real money pit. I also like the Fiat coupe from the 90s and the last BMW 5 series (peak Bangle!!). One of the later range rover 'classics' might be another interesting call.

I have owned one of those for 10 years (a standard series 8 RS), lovely looking cars and the only thing that went wrong was a window switch a few years ago. The reputation comes from messing about with them, they don't tolerate bad tuning. Annual service is £300 and insurance £266. I ended up liking the rotaries so much, I had my Mk1 MX5 converted, now 240bhp naturally aspirated and has been perfectly reliable. Admittedly, the mpg is rubbish (18-20) but they are a lot of fun.

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I have an 11 year old classic Mondeo fro £10k if your interested :-)

I actually bought it (2.0tdci) earlier this year, done a couple of DIY bits to it and it's easily the best car I have ever owned.

Try finding an early MK1 mondeo on a K plate, now they're quire rare, not that anyone would really want one. About 20 years ago I used to think that Ausin Ambassaror's would become quite rare and valuable. I was correct about the rare, but there is no demand for them because they were a pile of crap.

Sorry, can't resist:

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Don't know how you feel about motorbikes, but some oldies are getting seriously expensive - early Hinckley Triumphs, Slabside GSX-Rs, SRADS, decent old BMWs, in addition to the obvious old Brits, Ducatis and LCs. Don't take up so much space either.

djmgw

Friend of mine renovates old bikes. His latest project is a 1975 Kawasaki 500cc 2 stroke triple - iconic for its day. He had to import the very tatty non runner from the USA, and the total cost of the build will be in the £8k ball park. New exhaust sets are £1k for example. They sell for north of £10k though, so he should be ok. As do old bikes like Kwak Z1s, GT750s and original Triumph Tridents. If it was the near suicidal Kwak 750 triple it would go for even more.

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IMO classic cars are in a bigger bubble than the housing market ,(maybe excluding London) but nevertheless stay well away for a good while yet other than stumbling across a barn find owned by someone with very little knowledge are willing to give it away but they are rarer than hen's teeth due to the interweb

As for future classics IMO you need to look no further than the Focus RS`s the MK1`s are starting to get there already although i think that's partly due to the current bubble but ford RS`s have all had a huge following just look at the price of MK1-2 escorts

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Friend of mine renovates old bikes. His latest project is a 1975 Kawasaki 500cc 2 stroke triple - iconic for its day. He had to import the very tatty non runner from the USA, and the total cost of the build will be in the £8k ball park. New exhaust sets are £1k for example. They sell for north of £10k though, so he should be ok. As do old bikes like Kwak Z1s, GT750s and original Triumph Tridents. If it was the near suicidal Kwak 750 triple it would go for even more.

Two stroke dirt bikes (performance bikes in general ) are going through the roof in price ...just like land it`s because they ain't making any more coupled with healthy two stroke racing classes

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Classic cars certainly seem to have gone the same way as property, price wise.

I've always had a thing for the coke bottle shape mark 3 Ford Cortina (1970-76). My parents had a couple in the 70s - early 80s. Back in 1993/4 when I started getting interested in classic cars a decent Cortina III would be about £2k. Now a decent one can be £8k - and beyond. :blink:

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I have owned one of those for 10 years (a standard series 8 RS), lovely looking cars and the only thing that went wrong was a window switch a few years ago. The reputation comes from messing about with them, they don't tolerate bad tuning. Annual service is £300 and insurance £266. I ended up liking the rotaries so much, I had my Mk1 MX5 converted, now 240bhp naturally aspirated and has been perfectly reliable. Admittedly, the mpg is rubbish (18-20) but they are a lot of fun.

nice, I'm a bit jealous. I should probably stop living with compromise!!

As to my earlier comment about rx7's being affordable. When I was last seriously looking, something decent would be 5-6k. Just looked today, and you would be looking at 11-12k for a similar thing, so yes it looks like classics are going up.

Getting sort of back to the OPs question (rather than talking about my favourite cars). I bought I classic watch at the hieght of the financial crisis (probably early 2009). Was a very reasonable price. It didnt really feel like it was because of desperate sellers, more that the normal amount of buyers dried up. The watch in question was relisted on eBay a number of times before I thought f-it lifes too short and decided to buy.

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Guest eight

I always thought the Mazda Xedos was a great looking car - a bit too run of the mill for classic status though.

mazda-xedos-6-07.jpg

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They seem to have stopped making RX8's.

Surely a future classic. Always wanted one...

Well they are cheap as chips now probably one of the best value performance cars out there at the moment

But they have got their problems and it will probably be a long long time befoer they become a classic with the price tag to match al la http://www.carandclassic.co.uk/list/68/240z/

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How about the Vauxhall Monaro? A chap at work has one. :huh:

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