Passion Investing: Classic Cars
During 2018, classic car values as a whole rose by 5.9% (source Classic Cars). However, within the 1500 models used as an index there were losers as well as winners.
Broadly speaking the affordable embryonic classics showed significant gains in value where the established, more exotic and expensive models, either flatlined or depreciated, such as the Porsche 911 (996 models) down 12%.
2019 as we know is a tough year to make any predictions about as it is cloaked in such uncertainty, but if I had to guess I suspect that 2019 will be similar to 2018 because the heady gains of the preceding years at the top end feel likely to need time to settle, and in a time of nervousness investors may choose to operate with caution in this area of the market as the big ticket items have collapsed in value before.
The affordable classics I feel are the safer investment for the time being, as if there were a fall it would be from a kerb, not a cliff and the following makes and models I feel offer value, potential for future profit and enjoyment of ownership.
Ferrari 456 GT 1992-1997 and 456M 1998-2003
The reason I view these models as potential investments is because they are Ferrari’s and they are cheap examples of the marque £20000.00 to £40000.00 depending on condition, history, mileage etc. Many of Ferrari’s models have had a period of low values but that doesn’t last for long and the ride north can be exhilarating. With a 5.5 V12 forward mounted engine and rear wheel drive enjoyable to own and use as well.
Bentley Turbo R 1985-1997
With its 6.75 Litre V8 turbo engine and vastly improved handling than its predecessor the Mulsanne, I think its great looking and they fast and fun to drive. £500 -£40000 depending on condition history, mileage etc, the later the car the better.
Audi 80 Cabriolet 1992-2002
Good build quality stylish cars with a range of engines, I predict a future classic with true entry level prices from £1000.00
For buying any of these cars research is critical, service history, mot history, provenance and a mechanical inspection is always worthwhile.
Tax treatment of cars as an investment
Cars are not treated in the same way as other investments such as stocks and shares as they are classified as wasting assets which have a predicted useful life of less than 50 years therefore any profit you make at the time of sale is not liable to capital gains tax.
By Andrew Howie, first published in:
Rally Rd app now allows anyone to invest in classic cars.
Christopher Bruno: When people think about cars they often think of depreciating assets. We’re trying to change that.
Collectible cars have delivered 300% plus returns over the past ten years.
Rally Rd is an investment app where we take high-value, appreciating assets like collectible cars, and turn them into stocks.
Essentially, each car on Rally Rd is a mini public company, which is divided up into 2,000 shares.
Investors can create a diversified portfolio of interest in each of these collectible cars share by share, car by car. Investments start as low as $50.
Their goal is for everyone to have access to this high-value asset class. The buyer can buy and sell shares as they see fit.
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