Welcome to the Neville Staple Classic Car Blog.
Is it worth investing in a classic car?
From a Porsche to a Ferarri prices of these vintage and luxury vehicles have sky rocketed – but before we decide that this trend is set to continue it’s worth remembering both the 1980s boom and the subsequent bust afterwards, there probably isn’t anyone out there who’s owned one of these classic cars who hasn’t regretted selling them off. It’s not purely for emotional reasons that people regret this type of decision but because if they had held onto them, realistically they would be worth a great deal of money at the moment.
A tale of caution: the 1980s Classic car boom
The classic car and vintage car markets boomed 1988 and it was a marvel to see. Unfortunately though, they fell heavily back to Earth in the early days of the 1990s, some car prices even collapsed by as much as 50%. Vintage cars that everyone has heard of such as the Ferrari F40, which cost £190,000 brand new in 1989, saw its value reach almost a million pounds…but just 28 years later, even the best of them are only getting sold for around £850,000.
Supposedly, this time it is going to be different, as it is often said. It is speculated that the price rises are not typical of a bubble that has been financed by borrowing money and other clever financial packages but rather people are actually spending tangible and ‘real’ money. With an ever growing interest from emerging countries and economies such as China and India, there’s potentially even more buyers after a limited number of cars. So the question needs to be asked, should pensioners blow their savings on a Ferarri, as commented by Pensions Minister Steve Webb? Just how to these classic cars measure up to other forms of investment such as property and ISAs?
Some industry experts have speculated that the value of some classic cars has risen 257 per cent between 2005 and 2013.
Last year the Historic Automobile Group International, industry leaders said that the value of ‘exceptionally historic’ classic cars climbed 12 per cent in one year alone. When this is compared to the beginning of 2009, prices increased by an eye watering 164%.
So at the moment investing in classic cars is looking increasingly promising.
Getting classic car finance in a tough economy
These days any form of finance is especially hard to obtain, This is due largely to the hang over of the financial crisis back in 2008. It can be especially difficult to get classic car finance, these are typically luxury items that banks do not necessarily view as something that they are prepared to take a risk on.
Fortunately for the classic car and vintage car lovers out there, a number of financing companies have stepped in to fill this void. As with applying for any form of finance there are a number of conditions and stipulations that a would-be owner needs to meet.
It can be a little tricky to get classic car finance if you have previously defaulted on any type of loan, or have a bad credit industry. This is especially true if you’re seeking financing from banks rather than some of the specialist car financing companies out there. Even if you are turned down by your bank, It is still worth checking with the specialist companies, because they often are able to provide their customers with a little more leeway and tend to be a little more understanding of a less than perfect credit score.
So what type of classic cars can actually be financed at the moment? Well Believe it or not there exists a bespoke and tailored finance package for each and every classic car out there on the market, It is worth doing your research first however as some finance companies have better reputations than others. These companies are also able to assist you in sourcing your vintage car, helping you decide which one it may be best for you particularly if you are using it as an investment, as well as the actual financing part that they specialise in.