5 things to consider before buying a classic car

Last week I took part at the Bloomberg Invest Asia “Investing in your passion” panel where I shared my thoughts on things to consider when buying a classic car.  Here’s a recap:
1. Do homework
Identify the car brand, model, color and specs.  The next step is to take a deep dive and conduct due diligence.  Thanks to the proliferation of internet, knowledge is a commodity and so much information can be found with just a few clicks on the computer.  Auction catalogues from leading auction houses such as RM Sotheby’s, Bonhams, Gooding & Co. are a good starting point.  Catalogue description often provides a brief background of the models’ history as well as details specific to each lot.  Attending car club meetings is another great way to learn about a particular brand as well as an opportunity to mingle with other car enthusiasts and see their cars.  First hand experience from past/current owners is often the best resource.
2. Buy from reputable dealers and auction houses
It goes without saying that working with trusted people is the number one priority.  The vast majority of classic car dealers in the industry maintains a high degree of ethical standards and professionalism but when there are financial transactions there are scammers and fraudsters.  For private sales, bring a knowledgable friend for a second opinion, arrange a test drive, do pre-purchase inspection, check legitimacy of the paperwork, confirm the seller holds clear title to the car and is authorised to sell before handing over cash.
3. Condition, Condition, Condition
There is no such thing as a cheap Ferrari.  Classic car market is very efficient and price generally reflects condition.  As the old saying goes, “If it sounds too good to be true, it probably is”.  Contrary to conventional investment wisdom of buy-low-sell-high, paying top dollars for the best example often works well in the long run.  Buy high sell even higher.
4. Expectations
Automotive engineering and manufacturing technology has come a long way since the arrival of Ford’s Model T in 1908 – the first mass production vehicle in the world.  Modern cars are comfortable, reliable, environmental friendly and economical, everything classic cars is not. If you want to impress a spouse or boyfriend/girlfriend on a date in a newly bought pride and joy, chances are it may well end up on a tow truck.  Having said that, giving up modern day comfort in exchange for a rewarding driving experience is what this is all about.  Getting admiring glances and thumbs up from passer-bys is the icing on the cake.
6.  Purpose
Buying any car is already a big financial and emotional commitment, buying a classic car just takes this commitment to a whole new level.  Classic car is an expensive hobby that requires a lot of TLC.  What is it that makes you want to go down this route?  What are the objectives? Will your spouses or children be part of this journey?  Can you see your children sharing your passion and wanting to drive it one day?
There is nothing more discouraging than buying a childhood dream that turns out to be a living nightmare.  I have made many of the mistakes mentioned about and I hope this will be helpful to your journey to classic car ownership.
Would love to hear your comments and experience, please share them below.