$25k rule

[Alan]

This came up in another thread and I thought it deserved its own topic.


Just out of curiosity is the $25K rule for a good, reliable DeLorean out the window now? If so what seems to be the current price for a good, reliable, possibly even daily driver DeLorean?

As someone planning on seriously looking for a D starting this spring I'd also like to know. It'll help manage my expectations. I'm aware of the $25k rule. Thinking it was still fairly accurate, I had hoped to spend $25-30k with the idea that it should get me a quite good example. If it's now a $30k rule (or higher) I'd like to know so I can plan appropriately.

I'd like to try and keep this from becoming a thread about what people want cars to be worth and more about what's really going on right now with prices.

Thanks!

[Mark D]

I've found hagerty's valuation guide a good way to see how values are trending. When I had my car appraised the value that the appraiser guy came up with was pretty close to what hagerty said at the time.

It's slightly harder to place a DeLorean as a definite 1, 2, 3, or 4 condition than a traditional classic car, but most nice cars are probably in the 2-3 range with very few at 1, and some of the mostly restored cars at 1.5

http://www.hagerty.com/valuationtools/HVT/VehicleSearch/Report?vbe=12132

Value for a #2 car as of December is 27,500 according to their guide

[OverlandMan]

I've found hagerty's valuation guide a good way to see how values are trending. When I had my car appraised the value that the appraiser guy came up with was pretty close to what hagerty said at the time.

It's slightly harder to place a DeLorean as a definite 1, 2, 3, or 4 condition than a traditional classic car, but most nice cars are probably in the 2-3 range with very few at 1, and some of the mostly restored cars at 1.5

http://www.hagerty.com/valuationtools/HVT/VehicleSearch/Report?vbe=12132

Value for a #2 car as of December is 27,500 according to their guide

+1 on Hagerty. I use them to lookup lots of different collector car values. They seem to be pretty close on most of what I've seen.

Another thing you can do is lookup all the past DeLorean auction lots (Mecum, Barret Jackson, Russo & Steel, Bonhams, etc.) over the past 6 months. Put them in a spreadsheet and get an average. Of course, you'll want to add a column indicating the approximate condition of each. Most cars in these auctions will fall into the 2 or better range (going off Hagerty's scale). This is kind of time-consuming but should represent what the current market is pointing towards.

[Jonathan]

Based on the Hagerty numbering system (1,2,3,4) where they are described in one word as "concours, excellent, good, fair" and if you keep in mind the lengthier description about it being original, running, no visible flaws, no unusual noises or smoke, no chipped glass, etc., I think we need a category 5 and 6 to accurately depict where our 9,000 cars are.

The kicker though, is that if you factor in the price ranges from the Hagerty site into our 6 numbered categories, everything gets shifted two spots. The original four are at $13k, $18k, $27k, and $40k. What I have seen with cars for sale, or sold, or the ones I know of in person and have seen regardless of whether they are for sale or not but knowing what the owner or community thinks the car's description is, I'd say a number 6 car is somewhere south of $13k and a 5 car is up to $18k and then a fair car is at $27k and a good one at $40k. Then the revised 2 and 1 cars come in north of $40k up to something in the $55k range for a 1 car.

You can fudge some of those plus or minus a couple thousand, but that's my take on it. When I read the descriptions of what is apparently considered as qualifying as good or great or whatever and then think of my own car in an honest way, it won't meet many of those exact descriptions, but to the people that see my car in real life, it rarely gets pointed out as looking like crap. I recently saw about ten cars lined up for sale at one of the dealerships and was amazed at how awful they all were, compared to my own or most others I have seen. There are some nice cars in Ontario and then there are others which if you use these descriptions would pretty quickly get downgraded because they aren't pretty when you get close or still have a bunch of things going wrong on them.

Is a project car really worth $20k? I would say no if you are using the Hagerty 4 car system numbering. The problem is, I don't think the condition of our DeLoreans fall into those 4 categories very neatly. Not at all really. SHOULD a project car be worth less than $10K? Probably yes. But is it? No, not from what we see. And the almost running one with just a couple small problems that people are looking for for $20k doesn't exist either.

If the original question was what does a "good and reliable" DeLorean cost? $30k maybe, probably $35k. No longer $25k. That rule of thumb is gone.

[David T]

The biggest variable to the Rule-Of-Thumb is who does the work. If you do it yourself your money can go a LOT farther than if you are paying a shop to fix the car up. Another factor is how much work you really do. If all you want is a solid, reliable car that doesn't look so pretty you can save a lot of money too. Be honest and compare what you want to what you want to spend. Always buy the best car you can afford to start. In the end you will spend less to make it into what you want and you will get it going quicker. Just be careful not to overpay and wind up with a POS and have to spend a lot more than you figured.

[Rich_NYS]

I was watching a Texas car on eBay this week; it had over 140 watchers, and a Buy It Now price of 26K. High bid was at 19.3K with 1.5 days to go, then someone bought it for the BIN price. That could mean it was someone who has been watching price trends and wasn't taking any chances. I think we all predicted this year would be a sellers market, but I sure wish I could predict when the bubble will burst!

[Alan]

I was watching a Texas car on eBay this week; it had over 140 watchers, and a Buy It Now price of 26K. High bid was at 19.3K with 1.5 days to go, then someone bought it for the BIN price. That could mean it was someone who has been watching price trends and wasn't taking any chances. I think we all predicted this year would be a sellers market, but I sure wish I could predict when the bubble will burst!

Yes, that's kind of my issue. I know cars aren't investments. I also know values do increase. However I'm disappointed that I'm ready this year. I've waited quite a while already. I don't really want to wait longer... but I don't want to overspend because it's this year, either.

[Gfrank]

I purchased my one car for $18,500 last March and at the time that seemed to be the going rate (was on the road, needed a ball joint and the window motor replaced)
I'm suprised how quick the prices went up recently, how ever happy as I'll be selling one at some point this year lol

[OverlandMan]

I know cars aren't investments.

I think this applies to daily drivers and high-production everyday vehicles. For the collector car market, this isn't necessarily accurate.

An example would be if you purchased a Ferrari 288 GTO in 2006 for $600k and turned around and sold it this year for $1.5 to $2 million. That's an investment and you better know those who bought them years ago knew this.

The DeLorean doesn't really fall into that investment-grade category yet IMO but it may down the road. I didn't buy mine to hold for a few years and flip out of. If it gains 10-20% in value in 10 years, great. If it doesn't and stays flat or even dips a bit, so be it.

[Alan]

I think this applies to daily drivers and high-production everyday vehicles. For the collector car market, this isn't necessarily accurate.

An example would be if you purchased a Ferrari 288 GTO in 2006 for $600k and turned around and sold it this year for $1.5 to $2 million. That's an investment and you better know those who bought them years ago knew this.

The DeLorean doesn't really fall into that investment-grade category yet IMO but it may down the road. I didn't buy mine to hold for a few years and flip out of. If it gains 10-20% in value in 10 years, great. If it doesn't and stays flat or even dips a bit, so be it.

You are, of course, correct. I should have said generally not investments... Not for most cars and not for most of us with our budgets.

Back to DeLoreans, I agree with your assessment in your last paragraph. If the $25k rule is now a $30k rule, that represents a 20% increase. That seems like a lot compared to what, I think, most DeLorean owners would expect from their DeLoreans... to your point.

[Dangermouse]

I think the $25k rule is temporarily a $30k, or $35k rule even, for BTTF.

Previously, if you bought a $10k project car intending to work on it, and didn't really improve it (or make it significantly worse) you would still get your $10k back in a couple of years.

However, I think that $10k car may cost you $15k at the moment, but you may still only get $10k back in a couple of years, all other things being the same.

[Jonathan]

I forgot what the rule was there for a minute. I got thinking more in terms of purchase price rather than how much do you need to spend between day one and needed work to get to that nice, reliable car.

True about the cost of labour being lower if you do it yourself. Or in the extreme case, if you're a vendor or supplier or have some other means of getting parts at cost and the labour can be grouped in somewhere, not to mention all the right tools and lifts and diagnostic equipment, etc.

The full other end of that is the naïve guy who overpaid for his car on day one and has no other ability or option but to drop it off at an over-priced shop doing poor work.

It's almost like there is no real rule of thumb of "total = purchase + additional" for all of us because everyone would have their own conditions or circumstances.

I'll rephrase what I wrote earlier including the Hagerty numbering to more of a day one purchase price analysis. Then the individual can add their own dollar amounts to what it would take to go from a 5 car to a 4 or from a 3 to a 2. Like Dermot just said, the starting costs have definitely gone up, whether they should have for what you're getting or not.

[Rich_NYS]

Previously, if you bought a $10k project car intending to work on it, and didn't really improve it (or make it significantly worse) you would still get your $10k back in a couple of years.

This is exactly one of the things Jonathan mentioned to me when I was DeLorean shopping.




However, I think that $10k car may cost you $15k at the moment, but you may still only get $10k back in a couple of years, all other things being the same.

Totally agree, I think this is the thing to watch out for.



Another recent example of price trends: a guy on Facebook listed a project car for 9.9K USD.

-Hasn't run in 20+ years.
-Wasn't sure if the crank would turn.
-Areas of frame rust that was more than I wanted to handle.
-Transmission removed and disassembled.
-No ignition key.
-Slight dent in the rear quarter.

Guys lined up and ready to pay more than the asking price.....THAT is the market indicator right there, bro.

I think he decided not to sell it, which I was glad to hear because the car has a cool story about how his son discovered the car. He's a really nice guy, I hope we hear more about the car and that it became a cool father/son project.

[Dangermouse]

Linky?

[Rich_NYS]

Linky?

It was a month or two ago and I think the post was removed. I'll see if the guy is still on that page and check in with him and see how progress is, hopefully he & his son are working together on it. :thumbup:

[DMC-81]

Another recent example of price trends: a guy on Facebook listed a project car for 9.9K USD.

-Hasn't run in 20+ years.
-Wasn't sure if the crank would turn.
-Areas of frame rust that was more than I wanted to handle.
-Transmission removed and disassembled.
-No ignition key.
-Slight dent in the rear quarter.

Guys lined up and ready to pay more than the asking price.....THAT is the market indicator right there, bro.


Interesting. I think that individuals shopping for a project are sometimes competing with companies in the car business. When I was searching for mine, I looked at one being offered by a small classic car shop here in Florida. I went to see it soon after it was posted, and the owner of the shop already had a deposit on it from Germany. He fixed a few things to get it running and flipped it for a profit. Having watched the market for a few months prior, I recognized the vin as a car sold recently on EBay from Connecticut. The owner said about the car "I wish I had 50 of them". He gave me some searching tips and when I left, he was in the office scouring the internet for another one. That was in the summer of 2013......

[DMC-81]

I was watching a Texas car on eBay this week; it had over 140 watchers, and a Buy It Now price of 26K. High bid was at 19.3K with 1.5 days to go, then someone bought it for the BIN price. That could mean it was someone who has been watching price trends and wasn't taking any chances. I think we all predicted this year would be a sellers market, but I sure wish I could predict when the bubble will burst!

Indeed. One of the tips on EBay shopping that the car shop owner gave me was, if you like it, you have to strike hard to get it. I was very nervous about buying a DeLorean sight un-seen. Maybe if I had a trusted friend to inspect it before I hit BIN that would be different, or LOTS of detailed pictures and a walk-around video.

[David T]

Indeed. One of the tips on EBay shopping that the car shop owner gave me was, if you like it, you have to strike hard to get it. I was very nervous about buying a DeLorean sight un-seen. Maybe if I had a trusted friend to inspect it before I hit BIN that would be different, or LOTS of detailed pictures and a walk-around video.


A couple of things that are happening is the bad ones are getting worse and the parts are going up in price. That POS that has been sitting is worth LESS every year because it needs more and more work but the owner thinks it is getting more and more valuable. Cars that are in good condition ARE going up in value because the parts to get it into that condition are more expensive. Rust never sleeps. That barn find is getting more and more rotten and the critters are eating more and more of the wiring. Trees fall on them, parts get taken off them or get lost etc. The "cost of admission" (the purchase price) is not falling fast enough and the parts get more expensive. It still makes sense to buy the best you can. A runner will always be worth more than a non-runner for example although sometimes the difference is not as big as you may think (the runner is BARELY a runner!). If you think you will buy a Delorean cheap, fix it up cheap, flip it and make money, you have been watching too many TV reality shows. Buy one because you want to drive and enjoy it. Figure you will have to spend $20K at least one way or another. Do your homework so you know what you are buying. One way is to get Espey's book.