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Preserving History and Building Wealth: Classic Cars as the Ultimate Passion Investment

Meet our Guest Blogger, Chris Hiley-Payne

chris hiley-payne profile

Chris Hiley-Payne is a classic car consultant and specialist. Through his passion and knowledge of classic cars, he has helped many private collectors build significant car collections. Over the past 15 years, Chris has gained the knowledge and the expertise to advise on all areas of the market from classic cars, and modern classics to classic racing cars. He can guide you on which particular cars to add to your collection, and in turn, help locate the finest examples.

He has built a network of the most trusted specialists in the classic and modern classic markets. From marque maintenance specialists and restorers to car storage and transportation companies to valuers, insurance experts, and specialist car dealers.

In addition, he has expertise in financing these types of vehicles having headed up the classic, classic motorsport, and high-value car department of a bank in the City of London. 

If you are thinking of building a car collection for investment or just to fuel your passion, Chris can help you. Register interest via connect@thelifestylefixer.com.

Preserving History and Building Wealth: Classic Cars as the Ultimate Passion Investment

When it comes to ‘Passion Investments’ it’s hard to think of a better example than a classic car. The mention of Ferrari, Aston Martin, Lamborghini and Porsche stirs up feelings of excitement and passion. Driving and owning these cars is an unforgettable experience. The closer we move towards new car electrification the further we move away from the analogue driving experience and especially the exhilarating sound of a sports car. The term ‘they don’t make them like that anymore’ couldn’t be more true and these cars are in demand and will be more so as time moves on.

For many years there seems to have been a reluctance to call classic cars an investment asset class in its own right. For some reason, the word investment has only ever been whispered for fear of the market falling. Owners, dealers, and auction houses have often said that you need to love the car you buy and own, and if it happens to be worth more when you sell it then you’ve done well. This could not be further from the truth with many of the most iconic cars built posting incredible returns over the past 10 years. According to the well-respected 2023 Knight Frank Wealth Report, classic car investment returns over the past 12 months and over a 10-year period have been exceptional. The report states that over the past 12 months, the Classic Car Index has increased by 25%, and over the past 10 years it gained 185%, outperforming art, watches, and wine over that period.

Here, we take a look at 5 examples of classic cars that have increased in value over the past 10 years*:

1987 Ferrari F40
2012 Value £400,000.00
2022 Value £1,500,000.00

Price change over 10 years + 375%

1984 Ferrari 288 GTO
2012 Value £500,000.00
2022 Value £3,000,000.00

Price change over 10 years + 600%

1995 Ferrari F50
2012 Value £400,000.00
2022 Value £3,500,000.00

Price change over 10 years + 875%

1973 Porsche 2.7 RS Touring
2012 Value £175,000.00
2022 Value £500,000.00

Price change over 10 years + 339%

1972 BMW 3.0 CSL
2012 Value £35,000.00
2022 Value £165,000.00

Price change over 10 years + 471%

*Data from Octane Magazine – Annual Classic Car Price Guide 2012-2022

The investment returns for these cars have been spectacular with values expected to continue to rise, although perhaps not at the same phenomenal rate. There are many other classic car investment opportunities to be found though.

Classic cars fall into two categories – Classic Cars, vehicles built between 1945 and 1979 and Modern Classic Cars, manufactured from 1980 to 2005. There are investment opportunities in both categories, however, the first cars collectors tend to choose are the ones of the posters they had on their bedroom walls, or the marques they coveted when they were younger.

To maximise the investment returns it is important to approach classic car investments with element of caution and conduct thorough diligent research before making any purchases.

Here are a few points to consider:

  1. Rarity and Desirability: The value of a classic car is often determined by its rarity and desirability. Limited production numbers, iconic models, and historical significance can significantly add to a car’s value.
  2. Condition: The condition of the car is crucial. Well-maintained, restored, or original cars in excellent condition tend to fetch higher prices and have better investment potential.
  3. Authenticity: Ensure that the car is authentic and matches its original specifications. This includes verifying that the original engine, interior and exterior colour. Cars with matching numbers and original parts are typically more valuable.
  4. Provenance: Documentation of the car’s history, maintenance records, and any restoration work can also add to its value.
  5. Maintenance and Storage: Classic cars require the correct maintenance and storage to retain their value.
  6. Expert Advice: Consider consulting with classic car experts, who have in-depth knowledge of the market. Their expertise can help you make more informed decisions and avoid potential pitfalls.
  7. Time Horizon: Classic cars are often considered long-term investments. The market for classic cars can experience fluctuations, and it may take time for a car’s value to appreciate significantly.

Lifestyle – Events

There are a whole host of events for classic and modern classic car owners to enjoy. From the luxury Concours events such as the Concours of Elegance at Hampton Court Palace, Salon Privé, London Concours and the recently added and very well-received Concours on Savile Row. Of course, outside of the UK there is the prestigious Pebble Beach Concours and the ultra-exclusive Concours of Elegance Villa d’Este, held in Switzerland. If you like to see classic racing cars driven at pace, then the Goodwood Revival and Members Meeting are a must, and of course, let’s not forget the Le Mans Classic held in early July.

Capital Gains Exemption

In the United Kingdom, classic cars are exempt from capital gains tax as they are considered a “wasting asset” as most modern production cars depreciate. Considering the investment returns available this is a hugely attractive prospect for both investors and enthusiasts alike.

Final Thoughts

Classic cars can be an excellent investment in their own right, and an incredibly rewarding experience to drive and own. Investing in classic cars is not a guaranteed path to financial gain, but with careful research, a passion for them, and a willingness to accept the risks involved, there is an opportunity for significant investment returns.

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