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Wednesday, 29 September 2021 20:33

Cars as Investments on the Rise

Written by Steven Symes, Motorious

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Wealthy people don’t just stick all their piles of cash in bank accounts and in a house. They often invest in tangible objects, be it real estate, a business or collectable cars.

A new Knight Frank Luxury Investment Index (KFLII) sheds light on why we’re seeing the value of certain collectable vehicles shoot through the roof.

 

In the KFLII, wine and watches do come before cars, thanks to the two top items boasting a 13% and 5% 12-month increase in value, respectively, versus 4% for cars.

 

However, when looking at the 10-year figures, cars boast an enviable 180% increase versus 119% for wine and 87% for watches.

 

This doesn’t mean the good times will roll on indefinitely. After all, some items which used to be hot have fallen out of fashion. According to Andrew Shirley, editor of the KFLII, there are two items which were at the top but have fallen from those spots: rare bottles of scotch and Hermes handbags.

 

Still, it’s important to note handbags enjoy a 91% 10-year growth rate and rare whiskey sits better than anything else in the top 10 with 483% increase in the past decade. Those two items have seen a negative 3% and negative 4% growth in the past 12 months, showing the market can be volatile.

 

We understand that for enthusiasts who don’t have piles of cash, seeing the value of a dream car skyrocket well beyond anything they can ever afford is maddening. Many hold ill feelings for those who, through prospecting, have caused what used to be within reach to become unattainable. In other words, while some are celebrating this trend there is a downside.

 

We thank Motorious for reprint permission.