Vehicles built in the 1980s, 1990s, and 2000s have been the darlings of the collector car market in recent years. They appeal to new generations of enthusiasts, who are entering the market en masse, and have benefited hugely from the growth of online auctions. But how hot are these vehicles, really? Sure, modern classics seem to set new price records every week, but a handful of sales—no matter how buzz-worthy—aren’t sufficient data to judge an entire segment. To untangle the hype from real appreciation, we have built a repeat sales index for modern classics.
We’ve talked about repeat sales indices before at Insider. Our 300SL index, for instance, tracks Gullwings that have sold more than once. The chief benefit of looking at repeat sales, versus all sales, is that they provide an apples-to-apples glimpse at price changes. Looking at all sales, in contrast, can be misleading because cars of varying quality can come to market from one year to the next. Say, an exceptional example sells for an unprecedented price one month. Over the next several months, that remarkable price draws poorer quality examples of that same model to the market. If the prices they achieve are condition correct and lower than the first seminal example, did values for the model tank? No. But good luck parsing that unless you know the condition of every car that sold.
The Hagerty Price Guide accounts for this by providing four different values based on condition. A repeat sales index, though, dispenses with that variance almost entirely. Most collector cars (unlike new and used cars) don’t change condition dramatically from one sale to the next. That’s particularly true for modern classics, which are still less likely than older cars to get ground-up restorations between sales. And there are plenty of these transactions. (The oldest of our “modern” classics are approaching 40-years old and, consequently, plenty of them have been bought and sold at auction many times in the past twenty years.)
Building such an index is not without its challenges. The first being that we must define what is a modern classic. While there’s room for debate on any era of classics, older cars benefit from sheer seniority. (A ’53 Bel Air with a Stovebolt six is neither fast nor very valuable, but just about anyone who sees one drive down the road would identify it as a classic.) Newer cars demand a more discerning sniff test—we’ve included in the index vehicles that seem to excite enthusiasts. That doesn’t mean we only picked supercars. The index also includes affordable roadsters and practical sport sedans, as well as SUVs and hatchbacks. Just about every major automobile-producing country is on the list, except for France, which shows their absence from the North American market in past 25 years isn’t helping their collectability. Almost every engine configuration and location are present. Hybrids and electric vehicles are too new for this list, though.
Actually identifying vehicles that sold at least twice in the market is easy, since we can use the vehicle identification number (VIN). Modern classics, unlike those built before 1981, wear 17-digit VINs that uniquely specifies each vehicle. These 17-digit sequences also follow a consistent pattern, so when that Porsche VIN is mistakenly recorded as starting with WPO (oh), it can be fixed to read WP0 (zero).
This selection process yields a large dataset of some 835 matched transactions. Lots of data generally means better conclusions. We can more easily exclude questionable sales—say, a car sold multiple times by the same auction company in a short period—and those outliers that slip through have less impact on our results.
Our conclusion is, chiefly, that the market for modern classics isn’t as wild as it seems in the headlines. The past twenty years of the repeat sale index of modern classic vehicles, above, shows a run-up in the mid-2000s, followed by a long decline until late 2010, when the entire collector car market rebounded; a mostly steady performance over the last decade; and a rise beginning in 2019. This isn’t all that different than our index for muscle cars, thought to be a far more mature segment.
In comparison, a 12-month trailing average price of those same types of modern vehicles—but not just those that have sold twice—races towards a jagged peak in 2015 then drops off. The big difference between the trailing average and the repeat sale index suggests some exceptional cars did sell for a lot—and only sold once. Other cars that have since been drawn to market haven’t sold for nearly as much, probably because they’re in poorer condition. However, cars that are of a known condition have enjoyed a solid and relatively predictable return over the same period.
You might read this as saying the market for modern classics isn’t quite as hot as headline sales might make it appear. That wouldn’t be completely wrong, but keep in mind that for most of us, slow and steady growth is a good thing. It means you can buy a modern classic, drive and enjoy it for several years, and be reasonably sure you’ll get what you paid and then some when it comes time to sell. In other words, the market for modern collectibles is growing up.