Classic cars are proving to be one of the most lucrative investment avenues, provided you chose the models in which to invest. Based on reports from the Historic Automobile Group International, it is evident that there has been a spurt in the investment of classic cars as of late. Figures show that there has been a 20% rise in the prices in some segments of vintage cars compared to other alternative investments like equity shares in 2011, and yet another hike in price by 10.33% in the first half of 2012 which clearly outperforms the 4.54% gain of the S&P Global Index.
In spite of depreciation, wear and tear, emptying your wallet on frequent trips to garages and mechanics, there has been an annual growth rate of 12% in the performance of 50 key collectable classic cars in the past 30 years. However the performance varies between different types.
For instance, a 1955 Aston Martin drophead coupe fetched a clear margin of 25% in just two years. Porsche models fetched a gain of 10.63% in the first half of 2012 while Ferraris gained by 9.49%. A Ferrari 250 GTO clinched a record value of $35m in 2012 with a mind-boggling margin of $27m.
Here is the best part! Investments in classic cars are said to be exempt from capital gains tax, so it is a hassle-free investment.
However, this vintage car investment comes with certain essential needs – a large garage, continuous maintenance, shielding it from inevitable scratches, and accidents. So if you have a classic car (or are planning to buy one), you need reliable collector car insurance that takes care of your classic automobile. Classic Auto Insurance has a whole list of standard insurance plans like agreed value, roadside assistance and next term mileage rollover that you can opt for, or you can contact us for more information on one of our customized plans!
About the Author
Drew Yagodnik is Vice President of Classic Automobile Insurance Agency, Inc. Classic Automobile Insurance Agency has been protecting collector, classic and exotics since 1992.