In the wide world of investments, classic cars do not rank at the top of most people’s lists in terms of ways to ensure a good return on investment, although on the flip side, they are also not as big of a risk as, say, high yield stocks. Of course, most people view classic car buying and restoration as more of a labor of love than a plan for their financial future, but that doesn’t preclude them from being just as sound of an investment as other more common commodities such as real estate, gold, stamps, instruments, celebrity signatures, art, or literally anything else that may or may not retain and gain value. The trick is to know which classic cars are worth something, what is special about them that makes them valuable, how to find and restore them for less, and when they should be sold for maximum profit.
Whether you are looking at classic cars as a way to invest your money or simply as a lucrative hobby, there are a few things you’ll need to consider. First, how much money do you want to put into cars? If you have a lot to invest, then you can certainly attend auctions to find specimens that are in perfect (or near perfect) original condition, or have been restored to same. With the economy currently residing in such a sad state, you are likely to find a lot of good deals right now at auction, but generally speaking, auctions are the best way to spend more money than you would elsewhere, due to the fact that anyone selling in this venue has a good idea what their product is worth (as does everyone attending).
A better way to ensure a return on investment is to search for classic cars that may not be in the best of shape and try to restore them yourself. This involves several steps. First, you need to know what kind of cars you’re looking for. Value of an older automobile is not necessarily based on its original cost (although sometimes it is). For example, when Shelby Cobras were first released on the market, they were not considered terribly expensive (at about $7,000, they were only slightly more expensive than an average mustang). But today, a mint condition Cobra produced by Carol Shelby can net you over millions of dollars (the highest sale at auction was over $5.5 million). That seems like a pretty solid investment, alright.
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