What Determines my Classic Car Value?

Author: Frank Capparelle         Publication Date: 05/03/2019

A graphic representing the variation in classic car value estimations from online valuation tools

“What determines my Classic Car Value?” I wish I could have a penny for each time those words are typed in the Google search bar. Google will bring up every valuation tool available. With hundreds of online valuation tools at our disposal that all give different estimations, what truly determines classic car values?

Hagerty Insurance is typically the number one ranking valuation tool. This is an amazing online data base search tool. Hagerty has been in the business of insuring classic and special interest cars since 1984. Thirty-Five years of historical data gives them the ability to have solid data regarding vehicle values. Also close to the top of Google appears NADA. NADA is short for “National Automotive Dealers Association” . NADA has an entire section dedicated to classic cars. It is a JD Power company specializing in vehicle data such as pricing and valuation, again this is an online valuation machine that is based on thirty plus years of vehicle listings. Last, I see Hemmings on the first page. Hemmings, as many of you know is a magazine/online listing company dedicated to classic and special interest vehicles. With all of these resources it should be simple to enter a vehicles year, make, model, and options to calculate an accurate value for your vehicle.

If only it would be so easy. I have a car that I am working to value for a customer as we speak. It’s a 1956 Ford Crown Victoria. This particular car was nicely restored to a bit better then driver quality back a few years. It’s a great running and driving car.

1956 Ford Fairlane Crown Victoria 292/200hp , the car used for my valuation testing
1956 Ford Fairlane Crown Victoria 292/200hp , the car used for my valuation testing.

I ran it through each valuation tool. The difference between the 3 is about $20,000 based on a calculation for the vehicle in good condition.

Hagerty Valuation Graph Tool Results for 1956 Ford Victoria ($13,800 in good condition)
Hagerty Valuation Graph Tool Results for 1956 Ford Victoria ($13,800 in good condition)

Nada Valuation Tool Results for 1956 Ford Victoria ($26,700 in average condition)
Nada Valuation Tool Results for 1956 Ford Victoria ($26,700 in average condition)

Hemmings Valuation Tool Results for 1956 Ford Victoria ($32,885 average selling price)
Hemmings Valuation Tool Results for 1956 Ford Victoria ($32,885 average selling price)

How is that possible you say? I believe that some of it is the difference between how the data that creates the valuation tool is gathered. Hagerty is basing the valuation on “Insured” value as well as what they paid after claims occurred. NADA is using data mined from dealers' sale statistics. Hemmings appears to be based on the list prices from advertisements. I think it is unlikely that Hemmings is privy to what cars advertised with them sell for. I may be wrong with this theory, but the large valuation discrepancy must be due to something. Now that I have that variable sitting in front of me I have the vehicle condition to define. Vehicle condition is typically placed on a number scale. The numbers start with a high of 1 as excellent/concourse/museum. With rating increments of 2, 3, 4, and finally 5 which is a project car/poor condition. Each of these classifications represent different levels of restoration, and originality.

Valuations must take into account modifications and build specifications. Classic cars, and even Newcomers and Youngbloods (new terms for the modern collectable vehicles) have had many years to acquire changes such as wheels, tires, suspension, and motor options. Classic car modifications can add value, but more often than not they reduce value based on the taste of the modifier/owner. Modifications also tend to age faster meaning they begin to look dated where the original cars tend to be more timeless when restored to their original state.

1955 Ford F100 with modifications and gold paint
1955 Ford F100 with modifications and gold paint

For those of you with in depth of knowledge in the car world, you are probably looking at this thinking I have over simplified, and that there are far more variables that need to come into consideration to obtain the value of a vehicle. To those people I say you are correct, but with that said there is one variable that I believe is the most important. This is the one variable that the seller of a vehicle be that a dealership or private party cannot control.

What is this variable you ask? “What is a buyer that is holding the money willing to pay?”

It’s not the employer who controls the wages. Employers only handle the money. It’s the customer who pays the wages. --Henry Ford

As a seller we can come up with an asking price. We can base it on a reputable online valuation source. We can base it on what what I like to call “I let her go for X price”. This one is the toughest. We can price it based on what we have spent to get the vehicle where it is now, effectively looking to recover what was spent to restore, modify, or purchase the vehicle. Car guys in their heart of hearts know this last one is a fantasy. If you’re going to restore or modify your vehicle, you can expect a loss of a portion of your investment. None of these valuations mean anything once the advertising begins and people start to inquire about the car. A starting point yes, but the final agreed upon number is hopefully a negotiation between the buyer and seller. More often then not I find the final valuation of a vehicle is where buyers become willing to say yes.

I have experienced this phenomena several times myself. Situations such as a seller asking a number slightly above the amount he paid to restore his car, which was more than the first three homes I owned combined. I started week one of the ad campaign quickly discovering that buyers work very hard to get off the phone with me once I uttered this very optimistic number. Once 10 days of this goes by, and I have received what I call the “ F U “ responses. I am able to tell a seller what the sell price should be. I always ask a potential buyer what they think. Buyers are savvy, and always shoot low, but it gives me a range. My hope is always to find a quick compromise early in this first 10 days. A figure agreeable to both the buyer and the seller quickly, and cleanly. You ask why I say quick? You may argue that sometimes it takes time for buyers to find a listing. I say yes, but thanks to the internet the buyer I am looking for searches every day. I have found that the first days of an ad campaign are crucial. I tell my sellers that for those days they are the bell of the ball meaning the most desirable. Buyers that are specifically seeking this vehicle find it and smile. The chase of the vehicle being more intoxicating to some than the first drive. Your first few interested parties typically hold “your guy”. If you are truly ready to sell now, “your guy” is willing to buy. Once an advertisement ages the buyers begin to shy away. I assume this is because they think the price is too high, and wont even bother. Then there are those that must feel this is damaged goods or someone would have snapped it up.

A sale is about timing also. Sometimes timing is wrong. Say you are marketing a convertible, and the East coast is being hit by a Nor’easter (large winter storms that occasionally wreak havoc in the East US) . A huge share of your market is now trying to preserve property not, buy a toy. Sometimes a car has fallen out of favor. Normally when this happens it does not come back, but in the 70’s you could buy a Ferrari GTO for next to nothing. Now it is more expensive than an Island in the Caribbean. When I run a campaign, and I refer to all of my sales as campaigns, I give it my all. I keep copious notes from prospects or the lack there of. I follow up, and work at a sale. If all of this runs dry resulting in another sale I back off. When I re-list a few weeks later it can and usually is a totally different experience with a completely different group of buyers.

1962 Ferrari 250 GTO SI
                2dr Coupe 12-cyl. 2953cc/300hp 6 Weber Carbs with red paint
1962 Ferrari 250 GTO SI, this beauty gets a valuation estimation of $56,500,000 from Hagerty today. Legend has it a GTO changed hands in 1969 for $2500.

What does all this mean? Where am I going with this? Guidelines such as online valuation tools, current listing, and what you will take to sell, are fine. Timing is huge, but in the end the buyer ends up setting a final price. If the two parties do not agree, then it’s not time for the seller to sell, and the buyer looks for another listing. When you’re ready to sell evaluate and come up with the best number you can. Make sure to create an appealing ad, and when the ad hits don’t just talk to the prospective buyers, listen. If you’re ready to sell I am sure you can compromise and come up with a figure that will satisfy both you and the buyer.

The key epilogue to the discussion about “What is my classic car worth?” is a simple question. Am I ready to sell? Will the money in my hand make up for your Treasured vehicle not being in the space it has been occupying? I specialize in cars that typically are treasured by the people that own them. Once the decision is made to sell, the other variables fall into place.

About the Author

Frank Capparelle is the founder of Treasured Transportation. As a classic car trader he has always had a love for unique and classic vehicles, and wishes they will one day be treated like treasured art instead of "just cars".

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