Thursday, 11 May 2017

Hagerty Says Affordable Classics’ Values Are at an All-Time High

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1967-VW-Beetle-1500-876x535 2

Values for high-end collectible cars have been on the rise for years. Lately, the market appears to have softened, but that hasn’t diminished the appetite of collectors. Values of affordable collector cars continue to rise, according to specialty insurance company Hagerty, which insures more than a million classic and collector cars. 

Hagerty’s “affordable classics” value index, which tracks vehicles from the 1950s through the 1970s that are priced under $40,000, is at an all-time high. It rose just 1 percent in the company’s latest four-month tracking period from January through April but has been on a steady climb since September 2011. The index includes vehicles such as the 1967 Volkswagen Beetle pictured above.

The category of affordable classics was the only index of the seven that Hagerty tracks to have risen in average value over the past eight months, said Brian Rabold, Hagerty’s vice president of valuation services. The other Hagerty indices are muscle cars, blue-chip cars, 1950s American automobiles, Ferraris, German collectibles, and British cars.

The British cars category includes the likes of the 1965 Jaguar E-type SI 4.2 (which Hagerty currently values at $77,700) and the 1972 Triumph TR6 (valued at $12,400). The German cars index encompasses classics such as the 1972 Porsche 911S (valued at $128,000) and the 1957 Mercedes-Benz 300SL Gullwing (valued at $1.3 million). These indices, along with Ferraris from the 1950s through 1970s, all have seen car values decline this year.

Blue-chip cars—classics that cost more than half a million dollars—saw a sharp rise from 2010 to a peak in 2016, but the index is unchanged so far in 2017, according to Hagerty. American cars from the 1950s have remained more steady overall, and that index is unchanged as well for the first four months of this year. Muscle cars, too, hit a plateau in 2016, following a steep 35 percent rise starting in May 2014, when Hagerty’s index shows that values began an abrupt upswing.

Only the index of affordable classics has maintained its climb into 2017, though. Why? Rabold said it appears to stem from a buying frenzy that began five years ago.

“The first part of that five-year period, there was a sense that if you didn’t get in and get the car you wanted, you would miss out,” he said. “So there was this sense of urgency. Now that the market has cooled off, the urgency has gone away.”

According to Rabold, many would-be buyers of higher-end collectible cars appear to fear getting in at the top of the market, but they still have an itch to buy a classic. So they’re going the more affordable route, where there is also less risk.

Hagerty gathers values by tracking bidding at Barrett-Jackson and other companies’ public auctions, by monitoring online sales, and through voluntary sales data provided by its own clients. The company arrives at an overall index value by averaging the prices of selected cars that are in 2, or “excellent,” condition. Here are the cars included in its “affordable classics” index, along with Hagerty’s most recent valuation for them:

  • 1963 MGB Mark I: $11,200
  • 1967 Volkswagen Beetle: $11,200
  • 1965 Chevrolet Corvair Monza: $12,300
  • 1972 Triumph TR6: $12,400
  • 1967 Volkswagen Karmann Ghia: $14,000
  • 1972 Porsche 914 2.0: $14,600
  • 1962 Studebaker Lark Regal convertible: $14,800
  • 1949 Buick Roadmaster Model 76S: $16,000
  • 1971 Datsun 240Z: $16,500
  • 1963 Studebaker Avanti – $19,600
  • 1970 Chevrolet Camaro SS: $19,700
  • 1965 Ford Mustang GT: $25,100

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