Have you ever wondered to yourself: “What is my classic car worth?”
Indeed, knowing the value of your classic car at any given time is essential. That’s because the world of Canadian collector cars is always changing, and for insurance and buying and selling purposes, it’s important to keep an updated value on file.
Ahead, we’ll look at some of the most important factors impacting classic car value so that you can learn how to make and update this calculation for yourself.
How are Classic Cars Valued?
The first thing to know about classic car values is that they fluctuate frequently. Still, insurers and others need a way to value cars that is consistent, so they rate them using 20 factors.
Each of the 20 factors is rated on a scale from one to five. Once the rating is complete, the total score is tallied, and the car is put into a category based on its total score. There are four categories, from one to four, with one being the best and four being the “worst”.
Some factors affect classic car value more than others. Below, we’ve listed four key factors you’ll want to pay particularly close attention to when placing a value on your classic car:
Year, Make, and Model
This is naturally the first thing most people want to know when it comes to classic cars. Older Ferraris, for example, can be worth a great deal, as can some Mercedes-Benz, Aston Martin, and Jaguar models from the 50s and 60s. The 1963 Ferrari 250 GTO sold for $70 million in 2018, and the 1957 Ferrari 335 S sold for $35.7 million recently as well.
The Car’s Condition
Even if you have a collector car that’s extremely rare, if it’s not in good shape, it may not be worth very much. Factors that affect the condition of a collector car include the paint job and chrome work, tires, interior fabric, any restoration work under the hood, and the lights. When a vehicle is in pristine condition and is rare, it can be worth tens of millions of dollars.
How Rare It Is
As stated above, Ferraris, Aston Martins, Jaguars, and some Mercedes-Benz models can all be worth millions. But note that it’s the rare models of these manufacturers that are worth a lot — not all Ferraris are worth $70 million. If you can get your hands on an extremely rare model, that’s when the value skyrockets.
It may not be the car mecca that comes to mind when thinking about classic cars, but Canada has a long history of manufacturing collector cars, including the Acadian Canso, the Mercury (Ford) M-100, the Ford Frontenac, the Volvo 122, and Fargo trucks, among others.
Values of Similar Classic Cars Sold Recently
There are two ways to determine the value of similar classic cars sold in recent months:
- Auction results are true market values based on what someone is willing to pay for a vehicle. The key is to make sure you are comparing a vehicle similar to yours.
- Private sales results, not to be confused with asking price, is data that is collected from listings of cars for sale. If a vehicle has been listed for a long time this could suggest that the vehicle is being valued too high.
Why It’s Important to Know the Value of Your Classic Car
For starters, knowing your classic car’s value is important because it gives you a jumping off point when negotiating buying and selling prices. If you plan on selling your vehicle, you’ll naturally want to know that you’re getting the right price for your property. Likewise, if you’re planning on purchasing a new collector car, you’ll want to know that you’ll be getting a fair price and won’t be overpaying.
In the same vein, when it comes to purchasing insurance for your classic car, you’ll want to know the value because this allows you to purchase the correct level of coverage. Where insurance is concerned, be sure you know the difference between true value and actual cash value. True value refers to how much your collector car is worth when you factor in customizations, historical interest, restorations, etc. On the other hand, actual cash value (ACV for short) refers to how much your vehicle would be worth (minus condition- and age-related depreciation) if purchased today.
You should also understand the difference between stated value and agreed value. The stated value of your collector car is basically what you say it’s worth. You might need some proof to back up whatever amount you choose, but basically, the stated value is how much you believe your vehicle to be worth. Conversely, the agreed value is how much both you and your insurance company have agreed your vehicle is worth. Because collector car values fluctuate, most insurance companies will ask that your classic car be revaluated for an up-to-date agreed value near the start of every policy term.
Want to learn more about best practices when it comes to owning collector cars? We have numerous posts on the blog about classic care, storage and maintenance tips, insurance options, and more. Check it out here.