Anyone else holding off buying?

[931GT]

I've been looking for another 911 for about 2 months now and I've been very shy about pulling the trigger. The reason... I feel like current asking prices are not in-line with what is clearly a huge supply of cars and obvious low demand. I've been watching the market closely for a couple of years now and have noticed in the past 6 months many cars languishing and being reposted over and over again without price adjustments. And this isn't just the beaters, plenty of nice cars are making the used car market rounds, again and again.

Even with an apparent end to the great recession on the horizon, the good old days of cheap money are gonna be over for the foreseeable future. Joe Public is upsidedown on his house and we definitely will not see again the glut of equity spending we saw in the last decade. You may say this has no bearing on the used Porsche market but I'm willing to bet a large amount of this past decade's demand was related directly to the unprecedented amount of money being tossed about as home values skyrocketed.

What will happen to an already over-supplied market that seems stubbornly attached to 3 year old prices as supply continues to outstrip demand?

I'm wondering if others are also being shy with there money, not out of general concern for their finances but because of a gut feeling that the used market is overbought?

Is there a large price adjustment coming?

For the most part I'm just wondering what others think.

[bwall]

The price adjustment has already occurred. Post-Lehman prices are much lower than before.

People sell Porsche for many reasons. Poor financial decisions lead to a minority of sales. Changing priorities, marriage & divorce, cross-country moves and death cause a greater number of sales, IMHO.

A lot of 911's also went to Europe over the past few years.

Don't forget that wealth is like energy; it is neither created nor destroyed it merely changes it's shape.

[linter]

This is a very interesting question, and a timely one for me, since I'm looking for an SC or similar, too. I may be way off base, and probably am, but here are my thoughts in response to the post appended below.

*The price adjustment has already occurred. Post-Lehman prices are much lower than before.

-- Could be. Then again, just because a price adjustment has occurred, that doesn't mean another one won't occur and take prices even lower. On the part of current Porsche owners, there's a certain amount of optimism in the air that needs to be pretty fully extinguished before the bottom of the market is truly at hand, imho.

*People sell Porsche for many reasons. Poor financial decisions lead to a minority of sales. Changing priorities, marriage & divorce, cross-country moves and death cause a greater number of sales, IMHO.

-- True, but that doesn't mean that a co-conspirator in your list of other reasons isn't poor financial decision making and/or the economy itself. The vast majority of sellers I have talked to cite any number of reasons for selling but in the same breath they almost always cite financial issues as well.

*Don't forget that wealth is like energy; it is neither created nor destroyed it merely changes it's shape.

-- Point taken. The way I understand it, asset classes come into favor and go out of favor, but no matter what, if the trend is real, it take much longer for the turn-around (up or down) to occur than anyone thinks it will and people who try to call the change in advance often have some vested in the predicted change.
Look at gold after the bull-market run of the inflation-crisis late 70s. What'd it take for it to seriously come back? 30 years? 35 years? I'm not saying that's going to be the case with P cars, I'm just saying such things have been known to happen.

All that said, we're going into tax season soon and I personally think this is a pretty good time to do some serious horse trading. I've been speaking to a seller who has been telling me all along that he's selling because of a divorce. Then yesterday he calls me and says, "What'll it take for you to buy the car right now? Now I got a tax bill due."
To me that suggests a certain amount of desperation, and that lower prices are coming our way. Good news for buyers. Bad news for sellers.

All IMHO!!!

(And I am aware that, as a buyer, I'm strongly biased in favor a lower-price thesis. Hey, it's hard to be objective, especially when it comes to an object like a Porsche!)

[Christien]

I'm currently a buyer and a seller, so I guess I can see both sides of the fence. But then, I'm only selling to buy, and it has nothing to do with finances. My car is paid for, never made a single payment on it, and I don't need the money for anything other than buying another 911, so I'm not going to sell it in desperation, unless the absolute perfect 3.2 cab comes along at a rock bottom price

I've priced my car less than what it was appraised at (because we all know appraisals tend to be a bit inflated), but still not at my "rock-bottom", because everyone wants to negotiate, so you have to leave yourself room for that. But I've got my rock-bottom set, and won't go below that. If my car doesn't sell, so be it - I love it and am happy to keep it if needs be.

Maybe I'm in the minority, but I'd sure hate to be selling it because I needed the money. It's definitely a buyer's market out there. I've been trying to sell a repo Mercedes S600 (12-cylinder monster mafia-looking car). The book value is 12K, but I can't move it at 6. I've had offers at 5 that I've turned down, now I'm reconsidering them.

I think the hardest thing in the world to do is to get people to part with their money.

[Macroni]

Make an offer..... make it the sellers decision.....

[gsjohnson]

Originally Posted by linter

*The price adjustment has already occurred. Post-Lehman prices are much lower than before.

-- Could be. Then again, just because a price adjustment has occurred, that doesn't mean another one won't occur and take prices even lower. On the part of current Porsche owners, there's a certain amount of optimism in the air that needs to be pretty fully extinguished before the bottom of the market is truly at hand, imho.

There lies the rub...Prices could go higher too.
The early 911 SWBs and Long hoods appear to have stablized and are trading regularly, although at a slower pace. Many of these cars are going to Europe as well. The really good cars are commanding all the money. I suspect that the SWB and LH cars will not go any lower, so buy now IMHO.

[anthony]

The 914 market has sort of mirrored the early 911 market. 914-6es and minty 73/74 2.0L 914s are selling for double what they did when I bought my 914 eight or nine years ago.

As with 911s, I think that really nice cars will still command decent prices. Really nice unmolested cars just keep getting harder and harder to find. This is especially true with 914s as they had non-galvanized bodies and being a "cheap" Porsche were often driven into the ground and then abandoned.

Later 911s (SCs/Carreras) didn't have the rust issues and were a much more expensive car so people tended to maintain them better. But still, I think we are getting to the point where premium cars just keep getting rarer.

My SC is not a concours winner but it's a very nice, unmolested and desirable garage queen with 90K original miles on it. It's black, sunroof delete, black sport seats, 8" rear Fuchs. I think I would be hard pressed to find another like it in a short amount of time. I look on craigslist and I see lots of crappy used-up Porsches listed but nothing like the one I have.

My point - the prices on nice cars or rare cars will be down a little but still command decent prices. The gap between nice cars and ****ty cars will keep getting wider.

[Sunroof]

If your looking at an SC or early Carrera to buy, the market is huge and prices seem to be excellent; however, I believe longhoods owners know the rarity, demand and value of their cars and many are sitting on them for now. I have not seen many longhoods on the market these days and those early great drivers are priced high. Could it be that the longhoods will soon reach the status of the 356? The 356s are rare and if you want to be a member of the party your going to shell out a hefty sum for a decent driver. The longhoods I feel are next in line for a spike. Cost of admission will remain high as the demand continues for excellent early examples. As a longtime longhood owner (73.5T), all I hear from dealers, shop owners and other owners is..............."the skies the limit on these cars". Until the economy improves, I think its just wise to hang on to them.

[dienstuhr]

I sold my restored '72 Datsun 240Z earlier this year. Asked what I thought was a reasonable price, held out for it, and got it. Now I have been looking to replace it with a P-car.

At first I was looking at cars of a similar vintage (longhoods that is) but I quickly found that the price of a good driver was getting beyond my budget of <$20K. I thought about mid-years as being a reasonable choice but thermal reactor issues etc. have scared me off those, mostly, and mid-year Carreras are mucho $$ as well (one advertised on Pelican here for $55K???)

So that brings me to SCs, which are the main focus of my search right now. Prices range from reasonable (>$15K) to absurd ($30K+) but I'm hopeful of getting my car this summer. I'm shy with my money (as the OP said) simply because I have one shot at getting my car and I don't want to get it wrong. I'm not borrowing any money for my car, this is my hard-earned savings I'm playing with. And it's not as if, in this market, one can buy a car, decide one doesn't like it, and easily flip it without risking taking a significant loss.

So, while I appreciate that this should be a buyer's market, "things are tough all over" and even buyers may hesitate at objectively desirable deals.

Regards,

d.

[Sunroof]

Your spot on D, but if you stay in the SC market some of the buys are excellent. The SC by the way is a fantastic car and one you would thoroughly enjoy. As a daily driver they are excellent. I have considered selling my 73.5T in favor of a good SC daily driver, but admittedly, their is something special about the older models. I do not know what part of the country your in but consider the Atlanta market as well, since we do not have rust issues down here and SCs are plentiful.

Take your time, get that PPI and good luck in your searches

Bob

[dienstuhr]

Thanks Bob! I know I will get my car sooner or later. I'm in the north (faaar north) but I'm looking all over the USA and Canada. Pelicanites have been awesome in helping me check out cars at a distance and I will get a thorough PPI on anything that I consider buying. Thanks for the good words on the SC, it reinforces what I have been thinking for a long time.

Cheers,

d.

[scotyp]

I will second the call on the SC. I bought my 82' light blue metallic coupe back in December as a first Porsche and I couldn't be happier with the choice! Happy hunting d.

Cheers,

Scot

[techweenie]

My opinion is that the market prices bottomed last Fall on many cars -- especially longhood SWB and LWBs and started back up at the end of last year.

I've sourced 5 cars for buyers in that time, looking at dozens in the process, so this is based on real world experience, not speculation or someone's bogus 'market report.'

I would also add that I've seen a few people spend months fretting about +/- a few hundred bucks, when they could have been enjoying a 911 all that time...

[grudk]

I think 931GT is onto something...

I don't think the bottom is in for housing/economy by a long shot. The 'nascent' economic recovery is fully dependent on continuing gov't support...

But we will see in time.

[whiterabbit]

Many SC's and Carreras going and gone to Europe so if anything I see prices rising. I personally have been looking for a really nice under 100k 1984-1989 Carrera and cannot find anything I want, and I am willing to pay up to 25k for a great car. There is a reason Sloan/Truspeed etc and co are holding onto their Carreras and pricing them at 35k plus and they are not stupid.

Also take note that many of the beat cars are getting broken as they are worth more for parts. Same with RS reps diluting the market.

[car-reras]

Having just bought my first non-pcar collector, a 1969 427/390 4speed Daytona Yellow Corvette, I can tell you, pcars are rare. They made over 38,000 Corvettes in 69 alone, and about 20,000 of them were big block cars like mine.
Pcars worth owning won't lose much, as most who have them now can weather most storms.

[Flatsixhead]

The economic landscape is horrible and we are NOT going back to the go go days anytime soon.. This situation will take several years to unwind - personal and government debt loads combined with low employment confidence / income uncertainty will continue to push people back to basics. I been thinking about buying another 911 for awhile but will be holding off for now. (1 Porsche is enough) Prepare for the worst case -reduce debt / increase savings & investments. Equities are very close to being "priced for perfection" which is not going to happen and fear will be back again. Actual selling prices will continue decline especially for the non-investment grade, high production cars. Can you say 996??

[PropellerHead]

Buy cars to drive, not as an investment where you expect it to appreciate.
That said, certain cars will 'cost less' in terms of total financial input over your ownership.

I recently sold a car I thought would be difficult - it was a salvage title and set-up as a hard core street car/mild track car. I priced it correctly at a fair number (not an inflated price) and got essentially my asking price. I had to be patient and beat the low-ball offers off with a stick but ~75 days later the car was on a truck to a new home. 10 days after that I brought my 911 home. It is a great time to buy. If you decide to wait it could prove to be a better time to buy, but think of all the miles/smiles you'll miss out on in the meantime!

Pick something which is fully depreciated and you'll do fine to buy today. If the market goes up or down from here, you really won't gain/lose any $ since you'll be buying at a reduced/inflated market then too.

[Sunroof]

If you read Excellence and follow Bruce Anderson's take on the Porsche market, the May issue that just came out has the updated early Porsche 911 market values.

Prices on early longhood 911's have come down since last year, but even though market pressures push for lower prices, it appears that the early models (E's and T's) in particular have settled into the 20K+ region for a good example. The "S" models of course demand more. Perhaps, the longhood values have settled for now into a more stable pricepoint since prices started fluctuating several years ago. Pretty much like the 356s. His new market values are somewhat encouraging, but not that depressing either. That is his take on the market for now.

Bob
73.5T

[PropellerHead]

Originally Posted by Sunroof

If you read Excellence and follow Bruce Anderson's take on the Porsche market, the May issue that just came out has the updated early Porsche 911 market values.

Prices on early longhood 911's have come down since last year, but even though market pressures push for lower prices, it appears that the early models (E's and T's) in particular have settled into the 20K+ region for a good example. The "S" models of course demand more. Perhaps, the longhood values have settled for now into a more stable pricepoint since prices started fluctuating several years ago. Pretty much like the 356s. His new market values are somewhat encouraging, but not that depressing either. That is his take on the market for now.

Bob
73.5T

Agreed Bob. One thing to note though is how quickly the trend reversed. In 2007 things went up nicely, then made a huge spike in 2008. I think 2009 is a combination of the general market as well as an indication of more sane figures for these cars.
I'd be very interested to know where/how Bruce gets his market data. This especially true for the pre-1974 vintage cars. I'm not sure how he has defined 'so-so', 'good' and 'excellent' cars. As long as he is consistent year to year then the trends are valid even if the absolute values are not perfect.

In terms of 'toys' (not primary transportation) I think it is all relative. I don't believe you can look at the early 911 alone. I believe one needs to look at various cars in the same segment. In that light, I think the 911 has withstood the market slump better than most cars I'd put in that segment. That makes them a conservative/smart buy to rebound even stronger than others in their segment too.