How Good An Investment To Buy & Hold a 25 Year Old Car? - PeachParts Mercedes-Benz Forum

beaulieub · #1 11-02-2006, 11:36 PM

Seems like some MB's I see on Ebay that are 20-25 years old can be bought pretty inexpensively say $2k - $3K. But when looking at 30-35 year old cars, their values have significantly risen. Would you agree that the values begin to climb the proverbial "J-curve" at that point and that maybe they are good investments? I realize that you'd need a place to keep it out of the weather and assuming you did nothing but hold for 15-20 years, wouldn't that be a resxpectable rate of return. Especially figuring that there'd be no tax to be paid on the gain.

What'dya think?

BenzDieselTuner · #2 11-02-2006, 11:39 PM

i think that the values will continue to rise, and that these cars (80's Benzs) make an excellent investment......the depreciation is gone, and the values will only rise and rise....

DieselCJ · #3 11-02-2006, 11:45 PM

Quote:

Originally Posted by beaulieub

Seems like some MB's I see on Ebay that are 20-25 years old can be bought pretty inexpensively say $2k - $3K. But when looking at 30-35 year old cars, their values have significantly risen. Would you agree that the values begin to climb the proverbial "J-curve" at that point and that maybe they are good investments? I realize that you'd need a place to keep it out of the weather and assuming you did nothing but hold for 15-20 years, wouldn't that be a resxpectable rate of return. Especially figuring that there'd be no tax to be paid on the gain.

What'dya think?

Consider that production is greater on the 'newer' (20-25 year old) ones, 15 years later, there may be many more around than the current 35 year old ones.

rg2098 · #4 11-02-2006, 11:51 PM

On a W123, no unless it's pristine and very low mileage. Now on a slightly more rare or highly coveted car like a 16 valve. I would bet yes.

A basic fintale or stroke 8 can be had for very cheap. Now a W116 with a 6.9 or a 60's 300 convertible....

Another example... 1950's ponton = cheap, 1950's 300 anything = expensive.

barry123400 · #5 11-03-2006, 12:47 AM

If you are serious you should buy an exceptional example. For starters it will always find a market. As an investment it will return more as well. The trick here is rate of return compared to inflation with initial cost a real factor. Plus storage conditions had better be good. Otherwise all cars go badly downhill sitting. Especially if temperatures drop below freezing in your area. A coupe is safer as well I believe. Colour choice might be signifigant too. Interesting thought, a 123 as a hold investment. There is always the ideal that the profit is at the buying end. If you get a really good example at well below fair market value now you have already made money so to speak. I also agree that something exotic is better usually as one poster mentioned. I am a hobbiest not a car speculator or investor. One car I own from the thirties was not doing anything for years and years and it did not matter to me other that I thought it strange that prices on that model were so static. Well that started to change in the last year for whatever reason. There is no rhyme or reason sometimes. A few of my cars will eventually go on the american auction circuit perhaps. They will just disapear in the states if that happens. If sold in canada they are treated as a taxable gain. They had to have a valuation placed on them in this country years ago. Any gain since that time has a punitive tax in reality. The government missed the mark as when the title changes hands the sale is reported to the nice revenue people. When sold in the states the title change is not noticed in canada. More than one way to skin a cat I guess. Of course they will eventually take a different approach like getting the american state goverments to report any canadian titles going through. They never sleep long it seems. A battle of wits?

Cateaux · #6 11-03-2006, 07:53 AM

Quote:

Originally Posted by barry123400

When sold in the states the title change is not noticed in canada. More than one way to skin a cat I guess. Of course they will eventually take a different approach like getting the american state goverments to report any canadian titles going through. They never sleep long it seems. A battle of wits?

I don't think it's very likely that the Canadian government will be able to get the states to report Canadian titles. The states, each with their own laws involving titles, can't even seem to coordinate with each other. Just look at all the flooded "Katrina cars" that have popped up for sale with clean titles in more than forty states.

t walgamuth · #7 11-03-2006, 08:23 AM

unless it is a very rare model, keeping old benzes as an investment doesnt really make much sense.

but if you are going to use them then it works much better.

or if you consder them a hobby then the cost of keeping them is not unreasonable. a bowler spends a good bit of money on his hobby for example.

just my opinion.

tom w

Hit Man X · #8 11-03-2006, 08:55 AM

MANY better ways to invest your money.

jnc19610 · #9 11-03-2006, 08:58 AM

Regular cars, even in good condition aren't much of an investment.

I've owned a 914/6 for 23 years. As money, it would have been better off in the bank

For fun factor, there is no replacment for a really fun car that you own over time.

I will admit now, I'm sort of tiring of it, but no one is waving big checks at me. People want to buy it, but they are also acting like it's a 36 year old car worth nothing.

Cateaux · #10 11-03-2006, 09:57 AM

I've been thinking about this. It seems that people get attached to cars that made an impression on them when they were young, maybe 10 or 15 years old. The muscle car crowd are usually in their 50's, people with 1950's cars tend to be in their 60's, etc.. Model T Fords have actually dropped in price as the people who collect them die off. It's typically when people are middle aged and the kids leave home when they have the time and money to buy their childhood dream car. That's when the cars start to really appreciate in value as people compete for survivors. For GenXers like me, I think we'll drive up the prices on cars like the Porsche 911, 944 and 928, DeLoreans, rusty little English sportscars from that era, and even early Fox body Mustangs and a few other Americans.

But the W123 diesels were primarily geriatric cruisers when new. No kid had a poster of a 300D on his wall. Though I think the W123s will at least keep up with inflation, I don't think you'd ever make a penny on one as an investment. They'll continue to be a great value when used as drivers, but will never generate enough excitement to make them skyrocket in price like a Hemi Mopar or a coffin-nosed Cord.

Matt L · #11 11-03-2006, 09:58 AM

If you see a car purchased new in the seventies for $4K selling for $30K today, it looks like a good investment. But you could have done as well in a good mutual fund over that time. While there may be some load to the fund, it wouldn't be nearly what you pay for license plates and insurance over those years.

NoSpark · #12 11-03-2006, 10:45 AM

Buying a car as an investment seldom pans out. Most people learned their lessons after that fallout in the early 90's. Although there are still some "blue chip" cars like Duesenbergs and Gullwings that increase in value, but you're talking about keeping pace with inflation and perceived demand.

kip Foss · #13 11-03-2006, 11:10 AM

Cars are on of the WORST long term investments you can make. You can watch all the Barrette-Jackson Scottsdale auctions you want and see them getting six figures for cars you remember your dad giving buying for $500 but on the average and in the end those cars have mostly not made money.

When you consider initial purchase price, storage, insurance, upkeep, maintenance, restoration, yada, yada, yada, those cars are monetary sink holes.

If you took the initial purchase price and invested in the stock market or real estate for 30 years odds are you will make more money. Remember, on average the market makes about 11% a year. Certainly you can loose your ass in the market just as easily as your storage building can burn down or the car can get stolen or wrecked, but in the overall you don't have near the costs in the market as you do in garaging a car for 30 years.

Hatterasguy · #14 11-03-2006, 12:56 PM

I would not use the word investment in the same sentence as MB. Well unless you are speculating on a Gullwing or 500k.

If you want a car where you can make some money order a new Ferrari, keep it for a year and if the market is good you may make about $20k.

Cars are just about the worst thing you can spend money on.

If you want to talk investments lets talk real estate, business, and the markets.

barry123400 · #15 11-03-2006, 01:59 PM

I agree with the last few posts as well. It is almost a crap shoot. That is why for me old cars have always just been a hobby. Who would have envisioned chrysler products that nobody really wanted would be worth as much as some are now. Impossible but true. There are very few cars in my mind that have real positive upward movement potential. If a person where really serious it almost better be a convertable for starters. At one time it was thought production numbers had rose so high that after 1960 there would be oversupply of availability of all cars as they age. Then the muscle cars exploded. If the experts cannot get it right what chance do we have. Also a lot of prices almost seem synthetic. I watch the large auctions and have to wonder if people have lost their minds sometimes. They are just cars even if we get somewhat emotional about them. I guess if a guy tried hard enough he could turn a hobby into a stress situation. Lots of help and hype out there to get stressed. My son in law made an investment of sorts the other day when he purchased a car for less than free. When he got me to examine it I just told him to buy it..The factory toolkit and european 126 type lights both in excellent condition and sold on ebay or to a member on our parts site would pay for the car. With enough left over to buy the part used that caused the owner to park it about 3 1/2 years ago. He missed it by a whisker when it was sold by a neighbour to someone else. But they neglected to pay for it so he got a chance. Very hard to figure out what the first purchaser was thinking. This car is not bad at all but perhaps to repair it at a dealer might scare you. They had been quoted 700.00 for an idle control module plus labour. Car idleled at 1700-1800. Plus the brakes are partially seized from sitting now. Plus a medium not structual dent in the rear quarter. The module turned out easy to repair and am getting the son in law to buy a used spare one for him to carry in the trunk. Beats a call from the road stating you know that module you repaired.

The brakes are probably going to be not too expensive to do by us. The dent is also petty straightforward as well and again we can do it. One problem I guess is the 90 percent rubber firestone tires have started to check and should be replaced. But all in all he did better than I ever have. There may also be some suprises but car did pass its yearly safety check and overall vehicle inspection about six months before being parked at a good mercedes dealer outlet. I hope he keeps it. If he were to treat it as a thirty day short tern investment I suspect he would do well percentagewise. But really the infrequency of this type of thing happening kills it as a regular habit.