The market as I see it. By Shawn Miller, President, Significant Cars Inc

First of all lets start with some givens.  The collector car market has matured.  Certain cars have been elevated to the level of works of art, justifiably so, and their rarity makes their value totally unpredictable.  Other similar cars will follow their upward trend.  Fads come and go, the market will ebb and flow, and the value of cars will change over time, sometimes positively, sometimes negatively.  The Market for Collector cars started in the late 50’s and early 60’s, and values gradually yet steadily increased until the middle 70’s.  People collecting cars then were by and large enthusiasts.  The market shot up in the 70’s, then stabilized.  In the late 80’s and early 90’s, flush with cash, a large contingent of international buyers and dealers started buying cars with an eye toward financial returns more than enjoyability.  Prices skyrocketed, only to fall in the mid 90’s, when their cash ran out.  People who got caught up in the hoopla bought at the wrong time and lost money.  Prices were flat until 9/11 at which point many people lost lots of money in the stock market and started investing in more tangible assets like Real Estate, Gold, various other commodities, and you guessed it, collector cars.  The market has steadily risen in the last 5 years.  Other forces like increased publicity have helped these gains. Some cars are way above where they should be and are due for a fall in value.  Others are still underpriced. 

The Collector Car market has many segments, and one should not just buy a car because they expect it to rise in value.  As an enthusiast first and foremost, I typically don’t buy a car I don’t like just because it is a good deal.  The fact the cars we know and love are neat things to own and drive, is not changed by how much they are worth.  They are still fun to own and drive, something that cannot be said for paper assets like stocks and bonds.  Unlike paper assets however, cars need ongoing care and maintenance, and really are a responsibility not to be taken lightly. So whether is it the Brass era or the muscle car era that floats your boat, my advice is to buy what you will enjoy, with an eye towards what you are paying for it, if that matters to you.

All that being said my predictions here assume a continued robust market.  Should there be outside forces that change the economy (some of which are already on the horizon, rising fuel prices, war, natural disasters, etc.) all bets are off!  One good thing this time around though is that the high prices being paid for Blue Chip cars are being paid by Collectors versus dealers, so in many cases these cars are finding homes, versus what happened in the early 90's.

Generally speaking, cars of the 20’s, 40’s, 60’s and 70’s are underpriced.  The most desirable models will continue to be open cars.  You can’t buy an open 30’s or 50’s car for less than 100 or 50 grand in top condition, so the corresponding model in these other decades will follow right along.  Interest in Brass Era cars has never been higher, so the prediction that Full Classics from the 30’s would fall in value as their contemporary owners passed on was incorrect. In fact prices for Full Classics have never been higher than they are presently. I doubt there are many people left who grew up with Brass Era cars, yet they continue to set sales records every year.  Interest in Nickel era cars is really picking up, 40’s cars are already on the rise, and 60’s cars are picking up steam quickly. There is still room here, particularly for coupes, which will show large returns in the next decade. 

There is a Black hole of Domestic production following the Arab Oil embargo that extended until the mid to late 80’s.  These cars are to be avoided.  There were virtually no truly open cars produced during this period.  European cars buck the trend during this time period, and should do well as the next wave of collectors matures. 

Some Specific models I think are underpriced are:

Early Mustangs especially convertibles.  Among the first Collector cars to gain recognition, their prices have actually been flat for a long time.  Sure there are lots of them out there, but they are very drivable, parts are cheap and can be bought at NAPA, and they are without a doubt an icon of the 60’s.

Thunderbirds.  Again one of the first cars to gain recognition they have also been flat generally speaking, and exhibit all of the same benefits as mentioned above.

61-68 Lincoln Continental,.An icon of the era, with exceptional build quality and styling.  Pretty sophisticated electronics, so make sure everything works. 

1957 Pontiac Bonnevilles, never a cheap proposition to get into but with 53-54 Skylarks above $150,000.00, these cars are due for a big rise. 

1953-56 Packard Caribbean.  A steal when compared to 57 Chevy Convertibles, much higher build quality, much more rare.

The Studebaker Hawk.  Extremely advanced styling for the era, they have enjoyed somewhat of a cult following, but are truly one of the greatest cars of the 50’s.  Really pretty cheap when you think about it.

GM Muscle cars.  With the Prices for Chrysler and Ford Muscle cars well into the 6 figures, these cars are way undervalued.

ACD cars.  Somewhat rarer than their contemporaries, but with lots of panache, styling, and performance, these cars are underpriced, but quickly rising.  All Duesenbergs are underpriced-especially Models A’s of which only 60 are known to exist.  Cords are rising rapidly, Auburns are a steal, but not for long, Speedsters are already out of reach and at an all time high.  Watch for open Auburns to excelerate quickly.

Pierce Arrows.  Arguably the finest cars built during the Classic Era, their conservative and quirky styling has held them back.  They are wonderfully advanced cars for their time, with exceptional build quality, and are due for a big rise in value.    

Franklins.  Way underpriced.  While derided for their boxy conservative styling, they are very stout performers, and are down right cheap.  This is the best way to buy a CCCA Full Classic on a budget.

Any Full Classic Sedan/Town Car.  These cars are way underpriced.  They cost more new for a reason, and they are much more user friendly than the convertibles that sell for 3-4 times what they bring.

Micro Cars.  Some already have seen tremendous strides but there is still room here.  Models that have already risen like the Isetta may be more stable than others yet to rise such as early Volvos, Saabs, Fiats, VW’s, Bantams, etc. Very easy to store and cheap to rebuild!

Future Classics.  All cars have an inverted bell curve of value.  Right now cars from the mid 80’s to early 90’s are at the bottom of their value point.  Mercedez Benz SL’s, C4 Corvettes, Porsches, Alfas, even Lagondas, Astons, and Rollers are great deals.  Detroit finally started building cars people wanted to buy instead of appliances again, so there are many great models to choose from here. They are somewhat sophisticated to maintain, so buy the best you can find. You will have to wait awhile, but time is on your side.  These are a long term hold.  On the plus side they make great daily or quasi-daily drivers.