Are Classic Cars Good Investments? Everything You Need to Know

Over time, classic cars can significantly appreciate in value, unlike the depreciation associated with modern cars. This means that classic cars can be good investments for collectors. 

The recent sale of the Coupe for a staggering $143 million proves that classic cars offer great investment opportunities. However, the initial cost, vehicle condition, rarity, modification, and unique specifications can contribute to the value of classic cars.

This blog will discuss whether classic cars can be a good investment and the factors to consider before investing in classic cars.

What Makes a Car Classic?

There is controversy about whether to classify a car as classic if it has existed for several years. However, any car with the attributes that make it collectible can be considered classic. Generally, a classic car should be at least 20 to 25 years old and have some legendary interest to collectors. 

Are Classic Cars Good Investments?

Investing in any project is risky, not only classic cars. Moreover, buying a new car is risky because you assume it will command high value later. You may be fortunate, but the chances that you will buy a car and expect it to be worth millions of dollars in a few years time is not certain.

When it comes to vintage car investments, you need to know that these cars are not equal and not all are good investments. Understanding classic car investments can help you identify the vintage cars that will increase in value. 

Some factors can help determine whether a classic car is a good investment. They include the following:

1. Rarity or any outstanding design 

The worth of a car in limited production is said to increase. This also includes models that were the first of a new design or generation. For example, the 1967 Ford Mustang Shelby GT500 is referred to as one of the sought-after and valuable vintage car as a result of its rarity. Some classic cars like the Jaguar E-type (XKE) and 1967 Volvo P1800 top the list of most beautiful classic cars and thus commands high value due to their great workof art.

2. Vehicle condition 

A well-maintained classic car that requires no repairs will definitely be a good investment. This will also remove the cost of restoring the vehicle, enabling you to have a better resale value later.

3. The car value

Using a valuation tool or hiring a professional can help you determine the car’s worth and provide a timeline of the values over time. The Ferraris 250 LM made by Scaglietti were only 32 and this made them to keep increasing in value with the highest-priced LM sold at auction for $17.8 million in 2015. Additionally, the Ferrari 250 GT which featured in the Ferris Bueller’s Day Off movie in 1986 resurfaced in 2016 to be sold for $18.5 million at Gooding and Company auction.  

4. Popularity

A classic car owned by celebrities or with a unique racing history, like the Ferrari W50 Testa Rossa, can affect the vehicle’s investment value. A classic car with a unique design and high performance attributes can also command a high value and is worth huge money.

Cars that are tied with popular characters – real or fiction – can also be highly sought after by collectors. Here are some of our articles that talk about these types of cars:

• Cars driven by John Wick in every movie
• The Cadillac from the Entourage Movie

How to Choose the Right Classic Cars for Investments

Since the value of classic vehicles appreciates over time, they represent a great way to enjoy a piece of history and earn extra money.

To find the right car for investment, be sure to conduct research to understand the current car market trend and what to expect in the future. This will help you decide which car will be a good investment.

You should avoid some pitfalls like overpaying for a car or not being aware of any hidden repair costs. You should look up the classic car history report to uncover hidden issues like a bad title and outstanding lien and detect any potential odometer rollback or if the car is stolen.

Before investing in a classic car, be aware of the overall costs of owning a classic car and also understand any tax or capital gain tax that may be attracted to owning a classic car.

READ ALSO: How Do I Run a VIN History Check on a Classic Car?

The Most Investable Cars in the Classic Car Market

Here are the top 10 classic cars whose potential for strong revenues continues to rise:

1. Ferrari 250GT

Manufactured in the 1960s, the powerful engine of the Italian-origin Ferrari 250GT made it a popular choice for racing lovers. The limited number produced makes them highly sorted among collectors, thus pushing up the market value.

2. Mercedes-Benz 300SL

The Mercedes-Benz 300SL was manufactured in 1955 as a racing car and is known as one of the most beautiful cars in automotive history. Its unique gull-wing doors and aerodynamic body were inspired by racing cars at that time. 

Only 1,400 cars were produced, making them rare and valuable investments. A 1955 Mercedes-Benz 300SL at Scottdale auction was sold for $6.8 million. This model can be a good investment as it has been shown to have high returns over time.

3. Porsche 911

With the Porsche 911 Turbo S sold for a staggering $1.3 million in 2022, the Porsche 911 became one of the most timeless and in-demand classic cars in the world. The car is uniquely designed, with a long hood, slanty roofline, and distinctive round headlights.

4. Shelby Cobra

The Shelby Cobra was manufactured in the 1960s by Caroll Shelby by fitting a British AC Ace Roadster with a mighty Ford V8 engine to have a true car powerhouse.

With only two Cobra 427s produced,  it has a portfolio of a high resale value due to its rarity. In 2016, the first Shelby Cobra sold for $13.75 million. The car was designed with high-quality materials, which include a lightweight aluminium body.                                             

5. Jaguar E-Type

Usually referred to as the most beautiful car ever made, the E-Type has long, sleek lines and graceful curves. The car also has a powerful engine and a lightweight aluminum body that helps deliver smooth handling. 

The model has 1,729 series in stock, with one recently sold for close to $300,000 at Sotheby’s in 2022. The car was featured in the James Bond film Die Another Day and has continued to be sought by collectors due to its timeless design, high-quality materials, and premium resale value.

6. Chevrolet Corvette

Produced in 1960, the Corvette has been sought-after due to its sleek and sporty design, which are the standout features. This Chevy is a perfect choice if you cherish both style and performance. 

7. Lamborghini Countach

Produced in the 1970s, the Countach became a groundbreaking sports car. Thanks to the powerful V12 engine, which produced a huge amount of horsepower (hp), it can accelerate from 0 to 60 in 5.4 secs.

8. Porsche 930 Turbo

The Porsche 930 is the first successful turbocharged engine to be manufactured. It was crafted by excellent engineering using the highest-quality materials and was originally designed for speed and accuracy.

In 2015, one of the wonders, Steve McQueen, sold his 930 for $1.95 million

9. Aston Martin DB5

Produced in the 1960s, the iconic British sports car DB5 was powered by a huge inline-six engine that guaranteed top speed and efficient handling. The car, featured in James Bond movies had a timeless design, with a long hood, luxurious interior, and sleek lines.

10. BMW 507

The 507 is a classic roadster featuring a timeless design with a long hook and short trunk. Famous owners like Elvis Presley have driven its popularity.  The car recorded the best sale when John Surtees’ was sold for $5 million at a 2018 Bonham’s sale.

Like any investment, investing in classic cars is risky due to fraud, lack of liquidity, and market volatility. Nevertheless, by working with and buying from reliable dealers and understanding market trends, investors and collectors can minimize the risk and have a great return on their classic car investments.

READ ALSO: The Greatest Car Makes, and Models in the 60s

Conclusion

Classic car investing can be a rewarding adventure, but it doesn’t come without its own risks. It’s crucial to avoid buying anything under pressure or by familiarity, as you could end up with a highly depreciating value, just taking up space in your lot. Take steps to consider the maintenance, restoration costs, and the need for classic car insurance, which differs from modern car insurance.

Frequently Asked Questions