Car as an Investment
Cars are a depreciating asset, right? As soon as you drive them off the lot, they loose half their value. But what if the car drove off the lot over 25 years ago?
My car has been one of the fastest appreciating assets I have ever owned. I’ll explain. I picked my car based on supply and demand. There is a high demand for E30’s, and a low supply. I watched the market ebb and flow for 6 months, before I was ready to pull the trigger. I waited till a month where prices were down, chose a car in a desirable color, with desirable options, that was in generally good shape. I paid 1700$ for the car, and drove it home from Rahway, NJ. Now already I knew I had gotten a good deal. Typically these cars in my condition sell for 4500$, meaning that I had doubled my car’s value by driving it off the lot. Later, I acquired a 200$ set of wheels. They are OEM, and were a rare option for the year. These add 500$ to the value of the car, bringing my total value up to 5000, and my expenses up to 1900. The final part is the original hardtop I am picking up Saturday. The cost of the hardtop is 650$, but due to its rarity, and good condition, it is worth $2000. This means that the total retail value of my car, if I sold it right now would be roughly 7,000. My total costs thus far are $2,550, meaning that for evey 1 dollar spent on my car I will recoup 2.75. This amounts to a 275% return on my investment, over a period of 6 months, something that a vanguard mutual fund will never come close to doing. Most of this value comes from rare accessories that are desired by collectors, as well as the time equity that I have personally put into the car. So the next time someone tells you investing in cars is stupid, or criticizes the amount of time/money you spend on your car, tell them to shut it, and direct them to this article.










