NOVEMBER 25, 2010: COULD YOU RETIRE IN 2010 FROM SELLING CLASSIC OLD CARS YOU BOUGHT IN 1988?

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The Monday Morning Quarterback is one of the most obnoxious people you can meet.

 

If you’re lucky, you only come across these smug “look-back with 100% certainty” guys every few months.

 

So… a few months must be up- welcome to a smug look back on old car values.

 

The big question is-could you retire in 2010 from the proceeds of flipping cars you bought in 1988?

 

Here’s some Monday Morning Quarterbacking at its finest.

 

I found an Old Car Trader from 1988. That’s 22 years ago…a fraction of a second for baby boomers or an entire lifetime for the average university student.

 

Either way, it’s a reasonable period of time to pass for a Monday Morning Quarterback who wants to assess the rise in value of the old American iron.

 

The blue chip cars are the tri-five (1955-56-57 Chevys). There were several ’55 Chevy 2-door post cars in the 22-year-old car magazine ranging in price from $5-8000.

 

They all looked like they were in good to great shape and most ran with a 327 or 350 V-8. Some had the Nova front clips and although most weren’t up to 21st Century resto-mod, touring car technology-they were great looking drivers.

 

Assuming you picked up five of these cars at $6000 a copy, in 2010 you’d be safely in the $25,000 range with each ’55 Chevy-probably more because they looked that good. That means that you would gross 125,000 on the sale for a return of $95,000 on your investment (less insurance, storage and maintenance costs). Not bad.

 

 

I saw a 1970 Road Runner Super Bird in the same magazine listed for 15,000 dollars-it was (allegedly) a numbers matching 440 car with roughly 75,000 miles on it. A few years ago this is easily a 150,000-dollar Plymouth wing car and even now it should hit 100,000 if all the information checks out. That’s a quick 85,000-dollar return in 22 years. Great deal.

 

 

Corvettes always have been, and always will be a great investment and that was clear back in 1988. There was a ’67 Vette roadster (427 435 horse), numbers matching, listed for $36,000. You had to take a bit of deep breath back in 1988 because 36 K could get you into a solid down payment on a good-sized house.

 

These cars are an easy 100,000+ car (typically around 125,000 or better) if the facts are correct as listed in this old ad. That leaves a tidy 64K after sale profit less the costs associated with storing old cars…or maybe your brother in law got drunk and wrapped the Vette around a mailbox.

 

 

But failing that, so far your 81,000 1988 dollars have turned into 254,000 dollars in 2010-certainly a better return than every house deal cut since the collapse in 2008, even with inflation factored into the equation. That house in 1988 that cost you 91,000 would sell for 170,000 in 2010 so a return of over 300% on old cars picked at random looks pretty good.

 

But like anything that looks too good to be true, there are landmines in old car speculation and in this case the landmines are the older cars. Model Ts, for example ranged from 5-15,000 and as the T guys will tell you, they’re selling for a lot closer to 5 than 15K in 2010.

 

The simple reason is the guys who really coveted these cars are dead and the herd has been thinned out, so yes-there will be day when a vintage Camaro will quit going up and eventually drop. It’s inevitable.

 

 

But one thing is clear-if these random picks out of an Old Car Trader are any indication, 100,000 dollars worth of 1988 old car investment wouldn’t get you retired but it could sure pay for a decent vacation.

 

 

Will it turn into a comfortable million dollars?

 

No…but it’s 25% of the way there and in today’s real estate market that looks pretty solid.

 

Jerry Sutherland @mystarcollectorcar.com

COMMENTS

DENNIS:”You ought to be throwing passes for the Rams, you nailed that on the button Mr. Quarterback.Most 65 year old “Baby Boomers” like me won’t be watching Barrett-Jackson, lamenting fondly about the car we took our girlfriends for their first back seat ride in, 10 or 15 years from now.But there’s a plus to this, we won’t be around to watch some sucker pay 20 times what it’s worth for a Toyota Prius, a Honda Element, or a Chevy Volt, either

 

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