Never Stop Driving #109: Fun Costs Money. And I’m Fine with That.

The international stock market meltdown earlier this week happened to coincide with several analyses of the classic car market we’ve published or posted recently. I am no financial advisor, so I’m not in any position to advise you where to park your investments, but I have always reserved a small corner of my own portfolio for collector cars. And on Monday morning, rather than sitting in front of my computer trying to check my 401(k) fund balances, I took great pleasure in walking out to my garage and seeing and touching my modest car collection instead.

Our recent car market coverage is based on the work of Hagerty’s team of data analysts, who study the classic car marketplace as exhaustively as any of the analysts whom you see quoted in the Wall Street Journal study the financial markets. Full access to their insights via the Hagerty Price Guide is one of the benefits of being a Hagerty Drivers Club member. You’re a member, right? If not, join here.

Hagerty started the Price Guide in 2009 to help people make informed decisions when buying or selling a car. Our analysts gather all sorts of data from public auctions, private sales, and even what cars people call us to insure. That last one is a way to glean growing or waning interest in particular models.

I don’t know all the inner workings of their spreadsheets, but I love how the group, known colloquially within Hagerty as the “Valuation Team,” helps us show people how accessible owning a fun car is. Every year we publish a list of cars, called the Hagerty Bull Market, that highlights vehicles my Valuation colleagues say are poised to rise in value.

To be clear, we’re not publishing an automotive investment fund. The point of the Bull Market List has always been to illustrate how you can buy a car, enjoy it for a while, and then likely sell it for about what you have into it. Fun costs money, but we all have a finite amount of bread. Some cars can be a storehouse of value, a place to park your dough that also happens to bring you and your family pleasure. The needle we thread with our market coverage is: Let’s not overly focus on the money part but be smart about it.

We are just around the corner from two fantastic automotive events where car collectors of every stripe can indulge their fantasies: the Woodward Dream Cruise in Detroit and Monterey Car Week in California. The latter is also home to a handful of live auctions, where some of the world’s most valuable cars travel across the block. While just a pittance of the cars bought and sold over a year trade hands in Monterey each August, our Valuation Team tells me that the auctions there set a tone for the overall market. That’s why we cover market conditions before, during, and after Monterey. You can access the latest here.

To get a sense of where we’re at, I interviewed Dave Kinney, one of our market experts, for my Never Stop Driving podcast (available on Apple or Spotify). As we’ve reported on our website, the market is slowly correcting to where it was before the pandemic. Common sense and stability have returned. That means it’s a good time to buy and sell because there are fewer wild swings in values. Your money is safer. That doesn’t mean there aren’t hot cars; this year’s looks to be the Lamborghini Miura.

I know folks who have enormous discipline when it comes to spending money even though they’re not scraping to pay rent. I hear them speak lovingly about a car they’ve long lusted after, which they delay purchasing while waiting for a market drop. I get it, part of the fun is the deal, but what’s more valuable than time? None of us knows how much we have, which is one way I justify frequently buying and selling cars, often at a loss. Fun sometimes costs money, right?

That debate was one of the topics discussed with Ramsey Potts, the VP of Sales for Broad Arrow, which is hosting a two-day, 150-car auction in Monterey. Listen for his take on the market and the fascinating behind-the-scenes work that’s required to present a live auction.

Both conversations occurred before the stock sell-off, the effects of which remain to be seen. I sense a shoulder shrug, but again, if I was a financial wizard, I’d probably be bidding on the Lamborghini. This year might be full of buying opportunities. In the end, however, does it matter that much? The message I hear again and again from the professionals who buy and sell cars is this: Buy what you love, and you’ll never be disappointed.

In any case, we will be covering both events, Detroit and Monterey, and you can follow via our website and social channels.

Don’t miss the latest from Hagerty Media including:

• Jason Cammisa highlights the greatest BMW you didn’t know existed.
• Barn Find Hunter Tom Cotter races an IROC.
• Oh no! BBS wheels filed for bankruptcy.

The Justice Department agrees with what I wrote last week: Google is a monopoly.

Get out and drive!

Larry 

P.S.: Your feedback and comments are welcome.   

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