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Car market correction: Strategies to preserve Your investment value

Car market correction: Strategies to preserve Your investment value

Added on: November 3, 2024
Author: OctoClub

1. The sports car market: Is now the time to invest?

2. From pandemic peaks to a market correction

3. Current trends: Normalized depreciation, but certain models buck the trend

4. Cars under €50,000: Affordable stability

5. Mid-range cars (€50,000–€150,000): A strong showing for Porsche

6. High-end cars (€150,000+): Iconic models with strong price retention

7. Conclusion

The sports car market: Is now the time to invest?

The car market has experienced a sharp correction since its pandemic price peak, resulting in significant losses for some owners. For instance, models like the Taycan have dropped by as much as $85,000 (approximately €79,900), while the C8 Corvette has seen a decrease of $34,000 (around €32,000). But this doesn’t mean all owners have to endure steep losses. In fact, there are many cars whose values have started stabilizing or even increasing, offering a buffer against further depreciation.

Before we dive into specific models, let’s understand what has led to this shift in the car market.

Mazda Miata

From pandemic peaks to a market correction

During the pandemic, car demand surged while supply plummeted, pushing prices sky-high. This led to rapid price increases across nearly all car categories, with some models appreciating by over 40%. Enthusiasts and speculators alike jumped in, treating cars as investments, and the buying frenzy drove prices even higher.

But the peak didn’t last. By early 2022, price trends began to flatten, and most cars began depreciating, often at rates exceeding the historical average. Double-digit losses were common. However, by late 2023, the market started to normalize, and depreciation rates returned to single digits. Data from Hagerty’s Market Rating and Market Index, which track collector car market trends, showed that the market had cooled from its overheated peak and settled into a more stable phase.

Current trends: Normalized depreciation, but certain models buck the trend

While today’s market mostly shows moderate depreciation, there are exceptions. Some cars have held their value remarkably well, and a few are even increasing in price. Let’s look at some recent data on these models, grouped by price range, to see which might be a good bet for minimizing depreciation.

Porsche Cayman

Cars under €50,000: Affordable stability

  • Mazda Miata (First Generation) – The Miata has seen a steady price increase since early 2023, with a median price currently around $14,000 (around €13,200). While this is slightly up from pre-pandemic values, after inflation adjustment, there is a small decrease. However, prices for low-mileage examples with less than 56,000 miles have generally stabilized.

  • Toyota Land Cruiser J80 – Far from a sports car, the J80 has a dedicated fan base and remains in demand. Prices for well-maintained models have risen to about $26,000 (approximately €24,500), an 8.5% increase from last year. However, due to high volatility in prices between top-condition models and those requiring more work, the trend might be partially due to chance.
  • Porsche Cayman 987.1 – With a median price of $32,000 for the S model and $26,000 for the base model (around €30,100 and €24,500 respectively), prices have increased by around 4%. This category has stabilized well following the market correction, with minimal inflation-adjusted losses.

Ford Mustang

Mid-range cars (€50,000–€150,000): A strong showing for Porsche

While the Porsche market remains exceptionally strong across the board, here are a few models worth mentioning:

  • Ford Mustang Shelby GT500 – Prices have recently hit around $99,000 (approximately €93,000), representing a 1.3% increase year-over-year. This price trend is statistically significant, with values stabilizing and showing modest growth since late 2023.
  • Ferrari F355 – Prices for the automatic Spider version hover between $90,000 and $115,000 (around €84,500–€108,100). This represents a year-over-year increase of 3.2%, though this may partly be due to chance given the small market size.
  • Ferrari FF – This model’s prices have steadied at around $149,000 (approximately €140,000), showing an inflation-adjusted increase of about 1.3%. The trend indicates the downward correction ended, and the market has since stabilized.
  • Porsche 718 Boxster (4L GTS) – With demand still high and the possibility of the next model being electric, the 4L GTS has risen by around 3%, with a median price of approximately €80,000–€95,000.

Mercedes SLS

High-end cars (€150,000+): Iconic models with strong price retention

  • Mercedes SLS AMG – The SLS AMG, including the base, GT, and Black Series models, shows robust price trends. For example, the base model increased by 3.3% to around $150,000 (approximately €141,000), though supply and price uncertainty mean some fluctuation is natural.

  • Ferrari 458 Italia – Though the 458 also saw a correction, prices have stabilized since mid-2023, with coupes now sitting at approximately $220,000 (about €206,800) and Spiders at around $260,000 (around €244,400).
  • Porsche 911 GT3 RS (991.2) – This model has performed well, with prices increasing 2% over the last year, currently around €260,000. The trend has remained steady since the beginning of 2023.

Conclusion

While none of these cars are “skyrocketing” in value as they did during the pandemic, many models are holding steady or experiencing gradual appreciation. Notably, the GT500, 911.2 GT3 RS, 991.3 GT2 RS, and 996 Turbo stand out with reliable price strength. However, this doesn’t mean that other cars aren’t viable options. Price trends have flattened out in recent months, offering a window for value-conscious buyers to enter the market with minimized risk.

Although predicting future values is difficult, these trends provide a promising indication of which models are likely to retain their value in the near term.

Inspired by the analysis of our friend @fourwheeltrader. Make sure you check his other videos https://www.youtube.com/@fourwheeltrader/featured.

 

 

Are you already a proud owner of a Toyota Land Cruiser, Porsche Cayman, Ford Mustang, Mercedes SLS, Porsche 911? If so, check out our selection of parts for this car at the following link:

https://octoclassic.com/product-category/toyota/land-cruiser

https://octoclassic.com/product-category/porsche/cayman

https://octoclassic.com/product-category/ford/mustang

https://octoclassic.com/product-category/mercedes-benz/w463

https://octoclassic.com/product-category/porsche/911

 

Photos sources: topspeed.com, editions-bienvivre.ch, wizardclassics.com, automobilemag.com, wallpaperaccess.com

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