Should You Invest In Classic Cars
June 6, 2008
With the current difficulties facing the housing market, and the fears of recession and then inflation causing the stock market to roller coaster, many are searching for something else to invest in.
During the housing boom that dominated the early 2000’s up until about 2005, investors were eager to buy homes in order to turn around and flip the property. Flipping a home is the process of buying a home, making repairs and pleasing visual changes, and then places the home on the market to be sold at a higher price. These homes were not used as residences by the investors. Flipping homes proved to be very profitable until a year ago when the sub prime mortgage crises hit the market resulting in the current credit crunch not to mention the fear of recession and now the resulting inflation that only promises to worsen.
Investors recognize that flipping homes in the current economical market is unwise. The wave of foreclosure has increased the inventory of homes on the market and the weak economy means that many would-be buyers are unable to make home purchases.
For those investors that once made money by flipping homes should look into investing in classic cars.
Classic cars have always been a great way to make money. It does, however, take some research before you run out and make a purchase.
There is more then just the age of the vehicle to make it classic. While age does play a factor there must be a market for that particular make and model. After all, if there is no market for a piece of merchandise to make it valuable and worth collection. Now, many investors, including insurance agencies regard classic cars as anything over 15 years old, which can be very misleading for those looking into investing in cars.
There are a few cars that are just not desirable and are still considered classic. If you choose to invest in these types of cars then you are not going to get much back in return. However, it is possible to have a car that is 15 years old and is very desirable or in limited quality which makes it a classic.
What makes investing in cars particularly desirable is the fact that it is a little more affordable than other forms of investing. Several of the cars that are smart moves to purchase only cost a couple of thousands of dollars. For a first time car investor it is not usually a good idea to take out a second mortgage in order to buy a car. Investing in cars can be just as volatile as any other markets so until you fully understand how the market works you will not want to put all your eggs in one basket.
The first step investors should take is research. There are several models, makes, and types of cars and vehicles in the world and before you settle upon an investment you should know why it is considered a classic and how much you can expect to make on it.
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