A lot has been written in the media about the extreme price increases of collector cars in recent years, which are sometimes referred to as the ‘Crazy Years’. Auction houses realized sales record after sales record and some cars doubled in value in only a few years time.
But in the history of the collector car market these price increases are overshadowed by two earlier events with much more remarkable and much larger price increases.
These were the boom of the collector car market in the ’70s and the car market bubble in the late ’80s.
Today, not much is known about these events from the pre Internet age, but in perspective with these extreme years the ‘Crazy Years’ have not been that crazy at all.
The Ferrari collector market finds its origin in the early ’70s, when sales prices of pre owned cars started to increase for the first time in history and eventually became higher than the list price when new. Within the classic car market the Ferrari 250 GTO has always had a prominent position and the value development of this car illustrates clearly the start and the remarkable events in the market.
When the 250 GTO was produced in Y1962-1964, the price for a new car in the US was around $18.500. In Y1972 a 250 GTO in good condition could be acquired for $10.000.
In Y1973 – the year of the first oil crisis – it became clear that asking prices were going up. In the years that followed a real hype around classic cars in general and the 250 GTO in particular started.
In Y1981 the value of a 250 GTO had increased to around $300.000, a 30 fold value increase in 10 years time.
As if this was not enough, in the second half of the ’80s the extreme price increases continued.
Due to several reasons – explained in our Classic Ferrari Value Report 2018 – a collector car hype started and in Y1989 a record price of $13.837.500 was paid for a 250 GTO.
Now in five years time a 30 fold value increase was a fact.
The tremendous value increases had created an enormous bubble, that finally burst in Y1990. Prices went down almost as quickly as they had risen. The 250 GTO – that was sold for $13,8 million in Y1989 – lost 80% of its value in four years time and was sold in Y1994 for ‘only’ $2,7 million. In Y1994 the market had reached its bottom and was relatively calm in the following years.
The recent value increases of classic cars in general and classic Ferraris in particular were remarkable. and the average value of a 250 GTO doubled in the last 6 years, but the real ‘Crazy Years’ were in the ’70s and ’80s.
Since the introduction of the Internet the market has changed. It has become more transparent and professional. It is not to be expected that developments like in the ’70s and ’80s will return.
But the value increase of the 250 GTO and other iconic classics will continue.
If people pay $141 million for a Giacometti sculpture, why not $100 million for a piece of art on wheels?
It is just a matter of time……….
More about the start of the collector car market, the late ’80s bubble, the recent ‘Crazy Years’ and the value development of classic Ferraris until Y2018 is published in our Classic Ferrari Value Development Report.