Are collector cars headed toward a flattening market?

The Hagerty Market Rating continues its slide for the eighth consecutive month—now down 11.8 points from its high a year and a half ago. While the Market Rating’s current score of 66.42 is still within the “expanding market” range, the continued free fall will likely move it into the “flat market” range sometime next year.

Optimism among our industry experts fell below 50 for the first time since April 2020, right after all future live auctions were cancelled due to a global pandemic. Its current value of 47.33 is the lowest its been since October 2010. Despite the low number, our industry experts described the current market as a “moderate and measured retreat from recent exuberance,” stating that anticipation for price increases, which fueled the boom during the pandemic, has largely left the minds of bidders, resulting in lower prices.

This phenomenon is reflected in the Median Auction Sale Price, which continues to retreat, dropping more than two points this month to its lowest value since the component was added to the Hagerty Market Rating in 2011. As our experts suggested, this is more of a return to normal than it is an implosion of classic car values. The current non-inflation adjusted median sale price is $30,450, a significant drop from its high of $34,560 in October 2022, but it’s really just a reset to October 2020 levels.

While Hagerty still gets more requests from clients to increase the insured values of their vehicles than to lower them, the ratio has been cut in half from its peak in fall, 2022. For vehicles valued above $200,000, the ratio of insured value increases to decreases has fallen 3.4:1 from 6.6:1, with the ratio for more affordable classics falling to 8.1:1 from 17.1:1. For owners who have decided to sell their vehicles, more than half sold below insured values. In fact, the percentage of cars selling above insured value is at its lowest point in nearly two years.

Not all is doom and gloom. Our macro-economic indicators have increased for the first time in four months, with inflation slowing significantly during that time. However, the broader economy can’t keep the Market Rating afloat on its own.

The Hagerty Market Rating is likely to continue to fall through the new year. In January, the classic car market will be sent a jolt of energy when thousands of cars are sold at the Kissimmee and Scottsdale auctions. These sales will inform the trajectory of the Market Rating, and will serve as a good indicator of what the emerging “normal” looks like for the hobby in a post-boom cycle.