With interest rates so low on money held in savings accounts and a volatile stock market is there an alterative form of investment worthy of consideration? Yes, there are many, with one of those being the investment in classic cars.
Some classic cars could make a good alternative investment
Of course, there is no guarantee that you will achieve a good return if you were to invest in a classic car and you have to be aware that the value of your new purchase could drop below what you paid for it. However, many investors like to have a diverse portfolio of investments.
It is estimated by the Historic Automobile Group International (Hagi) that the market around the world for classic cars worth in excess of £100,000 is presently valued at over £30 billion with this figure rising. In the 12 months to 30 June 2013, they estimate that the value of the world’s classic car market grew by just below 28% and that, when comparing the 3 months to 31 March 2013 with the 3 months to 30 June 2013 there had been an 11.8% rise.
Classic cars that have done well in this market have been the likes of Bugatti, Mercedes-Benz, Porsche and Ferrari with keen interest on racing versions. Only this month, the world record price for selling a car at auction was broken when a Mercedes-Benz W196R went for $26.45 million before costs and charges. The car certainly had a pedigree having been driven by World Formula One Champion Juan Manuel Fangio to victory at the Swiss and German Grand Prix in 1954.
The market is being helped by the fact that it only costs a few thousand pounds to transport a classic car by air around the world thus opening the door to an increasing number of buyers of vintage vehicles. In fact, in the United States of America, there is a bigger market than in Europe. It should also be borne in mind that for many buyers of classic cars it is not just about the monetary investment it is about the thrill of owning such vehicles to be driven and admired.
Yes, there is the opportunity to potentially make a good return on your investment but be aware of the “health warning” we gave towards the start of this post.
