Certain Japanese classic motorcycles have increased by 180% to 200% since March 2012. Is this an anomaly, is it a bubble or is this the beginning of an explosion I have predicted in emerging market classic motorcycles?
I sold a Honda CB750K0 to Czechoslovakia in March 2012 for £10,000. Last week the owner called me to thank me on advising him to invest in this motorcycle, because he had just sold it for £28,000. At the Historics auction at Brooklands, in June this year, a Dunstall Honda CB750 sold for over £9,000. In 2012 these were available for £3,500. At the Coys auction at Blenheim Palace, in July this year, a rough yet original Honda CB750K3 sold for £7,000. In 2012 you would have paid about £2,500 for this very machine. Genuine Honda CB750F2 Phil Read Replicas are starting to touch £15,000. In 2012 they could be acquired for as little as £5,000. Kawasaki Z1000s are now kissing the £8,000 mark and could be picked up for £3,000 in 2011.
There are numerous other examples I can give to demonstrate the price increases, but you get the point. The reason for this is the beginning of the price explosion I have long predicted. The reasons for such increases in values are simple demographics. In 1980 new motorcycle sales in the UK were 400,000 a year. In 1994 they were 44,000. Through out the 1960s, 70s and early 1980s most teenagers bought a moped (FS1E), and because they couldn’t afford the car insurance, ran about on a 250cc motorcycle for a couple of years before passing their car test. Many passed their full motorcycle test and ended up working as motorcycle couriers through the 1980s when you could earn £800 a week.
So until the early 1980s, when accessing a full motorcycle license became much harder, owning a motorcycle was embedded in our culture. So anyone over the age of 46, either rode a motorcycle, went on the back of s motorcycle, or had friends with bikes. And it’s such machines that have been stuffed in peoples’ sheds or garages that are the emerging market classic motorcycles of today. This 46 plus age group are the baby boom generation, many were young property owners of the 1980s, many have worked their way up into highly paid jobs and their children have flown the coup. This generation are very wealthy, in general, and there are a lot of them.
Apart from being a demographic driven investment and more consumers than machines available there is another factor driving the prices of such machines upward. The cost of restoration. You can buy a very good, original Honda CBX1000 for about £13,000. If you take a £5,000 CBX to any workshop for serious restoration, then they will charge you £25,000. So how long is it until these machines reach £30,000. I believe within about five years. The same applies to all of these emerging market classic motorcycles whether they are Japanese brands, Spanish motorcycles, Laverdas or Ducatis, they are all going to increase in value enormously.
Many people criticise the work I do, saying that I’m making their favourite motorcycles unaffordable. My answer is that I do not do that because I cannot, single handed, manipulate the price of classic motorcycles. They whinge that they missed out on buying a good clean example of their favourite classic motorcycle two or three years ago when they were cheaper, but that they didn’t want to pay that much at that time. My answer to them is that they should stop moaning about things that are out of their control and pay what the going rate is for such machines, as they will always increase in value.
I am being contacted by more and more people who owned motorcycles in the 1970s and want to invest their pension in their favourite classic motorcycles of that period. They understand that these motorcycles offer tax-free investing, they are one of the fastest growing assets offering extremely high returns, they are a fun investment and investors also understand that they are enormously under valued and will increase rapidly, as they have been recently.
If you want to know more about having fun and taking delivery of your favourite emerging market classic motorcycle, then contact The Motorcycle Broker. The Motorcycle Broker, helping others to invest safely, and tax-free in classic motorcycles at https://themotorcyclebroker.co.uk
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