One hobby that some people enjoy involves buying, restoring, and reselling classic cars. This can prove to be quite expensive, because some cars require extensive repairs. However, if done right, buying a classic car, fixing it up, and then finding a buyer for the restored car can bring a healthy profit. Following are a few tips on how to invest in classic cars.
Be Knowledgeable
Although you don’t really need to know anything about old cars to invest in a classic, it would probably be beneficial if you do. Of course, you can gain the required knowledge by reading books, magazines, and online articles. You can also learn a lot about old cars, and what they may be worth, by talking to others who already know about the subject. You may be more successful as a classic car investor if you like cars and know a lot about them, but if you don’t it would be best if you educated yourself before you spend a lot of money–and you can do that by doing as much research as you can.
Age of Specialization
For better or worse, we live in an age of specialization. People who want to make money from anything they do are usually better off if they concentrate their time and energy in a specific area. It’s the same with a classic car investor.
Instead of simply picking up a car because you believe restoring it could bring in a healthy chunk of cash, focus your efforts on finding out about a particular type or style of vehicle. As with any investment, the more you know about the details of your particular venture, the better chance you’ll have of making a profit when you resell. This can mean you will specialize in muscle cars from the 1960s, or you could have a more focused interest in 1966 Mustangs. The more narrow your focal point is, the easier it’ll be to become an expert on that subject.
Watch the Market
Once you’ve determined what type of classic car you’re going to invest in, you will need to know as much about the vehicle as you can. You will also need to watch the market to see if your chosen vehicle is retaining its value. Market trends change from time to time. One day collectors are buying muscle cars, and the next thing you know they don’t want anything but mid-50s pickup trucks. Any investor will tell you that collectors are fickle. You need to be one step ahead of them.
Networking Is Important
One of the best ways to stay informed is to network as much as possible. That means attending classic car shows and joining groups that are interested in the same thing you are. Talk to everyone you can who shares your interests, especially if they’ve been involved in classic cars for awhile. You should go to as many cars shows, rallies, and any other event where classic cars are on exhibit as you can. The more exposure you have to the world of classic cars, the better informed you’ll be–and the more you know, the better your chances of making a profit from your investment.
Remember You’re an Investor
Don’t make the mistake of falling in love with the car you’re restoring. It can be tough to part with something that you’ve spent so much time, effort, and money to make saleable. But if the market tells you it’s time to sell, don’t hesitate. Keep in mind that the reason you got into classic car investment was to make a profit.
But the Best
When you’re looking for a vehicle to invest in, it is a good idea to buy the best car you can get your hands on. Remember the old adage–it takes money to make money. Sure, you can make a profit by buying an old, beat-up jalopy and spending a lot of time finding parts and making it look like new, but collectors tend to buy upscale, immaculate vehicles. Instead of spending your time and money on a vehicle because you like it, find a car that collectors love, and buy that one.
Author Bio: Guest post from Cameron Gray. Cameron writes for AutoInsuranceQuotes.org