Invest in classic motorcycles to beat inflation

Invest in classic motorcycles to beat inflation, as history has taught us so clearly. All profits are tax free, so no CGT, no income tax, they’re a tax free investment just like classic cars. The returns have been eye watering since 2010, as you can see here from our ROI charts, but this is only the beginning. Money is really starting to pour into this market from the classic car market, as you can see in this article I wrote back at the beginning of 2019. However, the incredible returns we’ve been experiencing since 2010 have mostly come from demographics as you can see in this article I wrote back in 2015. The classic car investors are only just starting to enter the market and the demographic drive is only really now starting to make its presence really felt. Although classic motorcycles have delivered great profits, now is the time to invest in classic motorcycles to beat inflation. We have many more upward pressures on classic motorcycle values that haven’t even started yet, which I will explain shortly.

Ducati Bevel Cumulative 2
Cumulative ROI for some of the Ducati Bevel Drive series

Tax free investment beats inflation

This tax free investment beats inflation and always has done, even in the 1990s and early 2000s when they weren’t taken seriously as a tangible asset. Investors only became aware of classic motorcycles as a serious tangible asset in about 2012, when they realised that these machines were so undervalued. Company owners started buying the 1970s and 80s motorcycles of their youth once their children had left home and spotted the value these machines offer. What is surprising is that values have not increased much further over this period of time. The Ducati 7500SS green frame is the Ferrari GTO of the classic motorcycle world and is still only £200,000+ while the GTO is US$70,000,000 on the last sale. The 1970s MV Agusta 750 Sport, with pretty much half of an Alfa Romeo 8C in this machine, it is the Alfa 8C of the classic motorcycle world. Alfa Romeo 8 Cs have increased madly in price since 2010 and this one sold for US$19,800,000 in 2016, as you can see here, and yet these super rare MV Agusta 750 Sports from the 1970s are selling for £150,000. There’s a long way to go for classic motorcycle values.

Invest in classic motorcycles to beat inflation
1975 MV Agusta 750S being gunned on loose chippings

Classic motorcycle price drivers

The real classic motorcycle price drivers are supply and demand, like any market, but what is behind that demand? As I said, demographics are really starting to play their part in driving classic motorcycle prices ever higher. The incredible value offered by motorcycles to classic car investors is starting to bring canny investors over to the motorcycles from the cars. They offer better value with more headroom than the cars, so invest in classic motorcycles to beat inflation. The motorcycles take up less room than the cars and there is no left or right hand drive issue with the bikes. This all makes classic motorcycles a highly desirable tangible asset. China is already starting to come into the market with investors from that region already being spotted at Mecums Auctions over the last three years. Importation of motorcycles was banned in China in about 1997 and this has now been completely relaxed. Everyone in China started life on a Japanese built small capacity motorcycle until 1997. It is the largest motorcycle market on the planet with sales of new motorcycles having consistently grown from 10,000,000 new motorcycles a year in 2000 to 20,000,000 new motorcycles today.  The Chinese understand the collectibles market very well, their art market is 3,000 years old and they believe in tangible assets.

1969 Honda CB750K0 Sandcast
Honda CB750K0 Sandcasts are a joy to own if they have been correctly built. If not, you could have wasted your money on one.

Investment grade classic motorcycles only

Investment grade classic motorcycles only deliver the profits investors seek. You don’t find Picassos on eBay, in motorcycle dealers or on internet sites. Auction houses are a very high risk place to try and find investment grade classic motorcycles. I’ve never really understood why investors buy at auction, their terms and conditions offer no help for buyers, only lawyers delivering expensive law suits offer that. The machine is sold on site, as seen, not running and with no real due diligence offered, other than what the seller said. I also wonder about the sanity of deciding how much you pay for a classic motorcycle, under such circumstances, in thirty seconds and under extreme pressure. It’s a very high-risk strategy and investment grade classic motorcycles are so rare and all of them require vast amounts of work to bring them up to spec no matter how pretty they look. In our experience, working with these motorcycles since the early 1990s, only 8% of each model of classic motorcycle is investment grade. Then there’s a lot of chasing out of covered up poor work from the last forty or fifty years and setting the machine up correctly. There are very few people who can set up these classic motorcycles correctly. Anyone who buys one of the 8% of investment grade classic motorcycles, that are set to rise fiercely in value, will agree that now is the time to invest in classic motorcycles to beat inflation.

1979 Honda CBX1000
1979 Honda CBX1000 is a great bike for covering long distances on, two up and it’s fast too.

How to buy an investment grade classic motorcycle

The Motorcycle Broker offers an all in one service which really is how to buy a classic motorcycle without discovering nasty surprises. We do not hold stock because it removes the ulterior motive of us selling you something on our showroom floor rather than the motorcycles you want. We work with you to understand which motorcycles you want to invest in and like, it’s pointless investing in something you don’t like. We talk through the market so you have understanding of which motorcycles will perform and which ones won’t, because we have the data and understanding of the market. We are not motivated to sell you a machine hastily bought, no matter how shiny and pretty, to replace a hole in our stock. We are only motivated to deliver you an investment grade classic motorcycle that will bring you trouble free joy and great tax free profits. It is our aim to then add value to your motorcycle while you own it and sell it for you when it’s time to move your machine on. All of our motorcycles go through our workshop and paint shop. We set them up correctly to enjoy, give you a due diligence file and workshop file demonstrating the work we’ve done to your motorcycle. We deliver free of charge on mainland UK and give you a one year unlimited mileage no quibble warranty. That’s how confident we are about the quality of our work. Now is the time to invest in classic motorcycles to beat inflation. If you want to invest safely in classic motorcycles, call The Motorcycle Broker so we can hunt down your investment grade classic motorcycles for you. Now is the time to invest in classic motorcycles to beat inflation, but they must be investment grade examples.

1976 Ducati 900SS LHS
An investment grade Ducati bevel drive must be correct and authentic

Paul Jayson

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