Latest findings reveal that whilst the values of classic cars have taken a slight hit recently, they still represent the top performing asset over the past 12 years. With that in mind, now might be the perfect time to buy a historic VW…

Owning an older VW is great fun, that’s a given. You can fettle to your heart’s content, modify, restore, lavish time and elbow grease on them at the weekends – and even go to shows and make friends with fellow enthusiasts who share your passion. And that’s as well as the sheer pleasure of getting behind the wheel…

Gold in the garage

But there’s another huge benefit to owning a historic VW because as these findings show, a classic car is still the best investment you can make. According to the Coutts Index ‘Objectives of Desire’, while classic car values saw a short-term drop of 10.4% in 2016, they remain the top performing asset, up over 330% over the 12 years captured by their report.

Classic cars easily outperformed other ‘passion assets’ such as billionaire properties (up 96.9% since 2005), watches (up 104.8%), jewellery (up 148.8%), rare musical instruments (up 28.8%), coins (up 224.6%), stamps (up 103.2%) and fine wine (up 153.1%).

Provenance and rarity

Mohammad Kamal Syed, Managing Director at Coutts, said: “Provenance and rarity continue to be the two factors that are pushing prices higher. Classic cars have provided the healthiest returns since 2005, with average prices rising more than fourfold. However, after increasing rapidly in 2013 and 2014, price returns for classic cars fell in both 2015 and 2016. Moreover, this reflected falling auction prices for nearly all models in the index. Prices at the very top end of the market remain robust.”

None of this comes as much of a surprise to us to be honest. We blogged about how you’d be wise to spend your money on a classic VW rather than on a pension here and we also reported on the rising prices of Split Screen Campers at auction here.

Air and Watercooled prices on the up

It’s not just early air-cooled VWs that are going up in value. The Mk1 Golf GTi has also realised a rapid increase in interest, as we noted here.

You’re not too late to jump on the bandwagon though; we’ve predicted which VWs might become classics in the future here with the Type 25, Lupo, Mk3 Golf, Fox, EOS and New Beetle all getting a mention.

Or if you fancy something a little different but with a definite hint of VW, howabout a Porsche 924?

‘No-expense spared restorations’ are worth it long term

Interestingly, while the survey found that the most coveted cars continue to go up, the gap between the very best and average examples was widening. This is explains why we’ve witnessed owners of VWs spending more on ‘proper’ no-expense-spared restorations rather than quick patch ups.

Another advantage of investing in a classic, is that there’s no inheritance tax to pay on cars. So, should the worst happen, your car collection can be passed down to your loved ones, just like a piece of jewellery, a painting or any other material possession without the government taking a slice of its worth. That’s not the case with property, or cold hard cash!

But as Kamai Syed explains, there’s more than just financial considerations to consider: “The Index is not just about the value of the underlying asset. The emotional enjoyment of owning and sharing beautiful items is just as important.”

Ian

The opinions expressed here are the personal opinions of the author and do not necessarily represent the views and opinions of VW Heritage.