Hagerty’s UK classic car indices have all dropped in 2024. Valuation specialist John Mayhead looks at the reasons why, and what it means for the classic car market.
Confidence. That’s the bedrock of any transaction involving something that maintains a value over time. Whether it is a bottle of rare single-malt whisky, a Rolex, or shares in a company, all but the most laissez-faire buyers will be mindful not just that the purchase price is appropriate, but also that the value won’t immediately plummet once the wrapping has come off. Cars, especially classic and collector vehicles, are no different.
As the UK Hagerty Price Guide editor, you’d expect me to say that car values are important. One of the main reasons we publish the Guide and update it quarterly is to give enthusiasts a modicum of confidence when they’re buying, selling, or just valuing their own cars. And, in 2024, Hagerty has received the same report again and again from enthusiasts and dealers alike: Confidence is growing. The rise in auction sell-through rates – up about ten points since last summer – shows that the same confidence has reached the salerooms. The latest Consumer Price Index (CPI) figure of annual inflation is back down to 2.8 per cent, a level not seen for two years, and the FTSE 100 Index has shown great gains over the last couple of months. So, why is it that all of Hagerty’s UK Indices have fallen since last December?
Last summer, as I reported, there was a significant dip in buyer confidence. Auction sell-through rates were at a low level that hadn’t been seen since the early days of Covid, and dealers were reporting lots of interest but no sales. The post-lockdown boom had pushed prices too high, and buyers were voting with their feet. Last winter wasn’t a great time to sell a classic car. Then, as the days of 2024 became longer, asking prices started to fall and that seems to have rejuvenated the market. Our indices are now reflecting that drop.
Each of the indices are behaving exactly as we’d expect them to. The Gold Index, tracking the most valuable cars, dipped first but then stabilised first. Younger cars, that have shown more demand over the past few years, represented by the Hot Hatch and RADwood Indices, dropped by just one and two points respectively. Festival of the Unexceptional (FOTU) Index cars fell by under one per cent.
The big fallers were the Classic Index, tracking more traditional classic cars, and the Best of British. Both of these have a significant number of older cars, and this downward movement reflects what we’ve seen for some time – older classics, unless they are very special, have tended to lose or remain static in value. Does any of this matter to the enthusiast? I’d say not. Even the more dramatic-looking dips on the chart aren’t really a big drop, and the result should actually bring more stability to the market, not less.
