WHY AUC­TIONS CRI­SIS WILL HIT YOUR WAL­LET

Too many spe­cial­ists are com­pet­ing for the same sub-£10k cars – we re­veal how it’ll af­fect the clas­sics you’re buy­ing

Classic Car Weekly (UK) - - Front Page - Mur­ray Scul­lion

Asat­u­rated UK mar­ket with too many spe­cial­ists chas­ing the same cars is go­ing to push up prices, clas­sic ex­perts pre­dict. The in­creas­ing num­ber of auc­tion houses join­ing the mar­ket – and the record sale rates the larger ones are at­tract­ing – means that sell­ers are com­pet­ing for the same stock, re­sult­ing in prices that in­creas­ingly match dealer and clas­si­fied val­ues. Clas­sics Cen­tral is al­ready tak­ing a hia­tus from auc­tions, cit­ing mar­ket sat­u­ra­tion as the rea­son. Auc­tion an­a­lyst Richard Hud­son-Evans says: ‘There are too many cars be­ing chased and sought by too many auc­tion com­pa­nies. Nowa­days, quite a lot of buy­ers are us­ing an auc­tion as a first port of call. whereas tra­di­tion­ally, it was a last re­sort.’

‘There’s far too much in­ap­pro­pri­ately-priced stock’

Ex­perts are pre­dict­ing a short­fall in af­ford­able clas­sics and sub­se­quent price rices – and it’s all be­cause of the sat­u­rated auc­tion mar­ket in the UK.

Clas­sics at the en­try end of the mar­ket – par­tic­u­larly in the sub-£10k price bracket – are set to be­come a rarer sight be­cause more sell­ers are turn­ing to auc­tion houses, which in turn are hold­ing more sales. Both Brightwells and His­torics have in­creased the num­ber of sales they’re hold­ing and on Satur­day 25 March three new auc­tion houses are host­ing their in­au­gu­ral sales.

Auc­tions are also at­tract­ing plenty of buy­ers, with this year’s sell­ing rates re­main­ing very strong. SWVA achieved a 99% sale rate in its lat­est sale, while ACA shifted 81% of its cars.

Clas­sics Cen­tral’s man­ag­ing di­rec­tor, Justin Lazic, is al­ready feel­ing the ef­fect of this crowded mar­ket­place – his auc­tion house is cur­rently in hia­tus. He says: ‘There’s far too much in­ap­pro­pri­ately-priced stock among the 15 ma­jor auc­tion houses in the UK. And there’s too much price ad­vance­ment on some cars with lack of his­tory and high mileage.

‘The top end won’t be af­fected as there’s still plenty of good stock. But the lower to mid­dle end of the mar­ket is suf­fer­ing be­cause too many cars are head­ing to auc­tion.’

‘One ex­am­ple of this is the Jaguar XJS. A 5.3-litre con­vert­ible. An ex­am­ple in good con­di­tion is worth around £20,000. Smallerengined XJSs with higher mileage just aren’t worth the same, yet they still at­tract high guide prices.

‘Prices of some clas­sics, es­pe­cially those in the lower to mid­dle price area, are not ad­e­quately re­flect­ing sub model vari­a­tions at the mo­ment.’

Clas­sics Cen­tral’s break from auc­tions will last for at least the first half of this year. Lazic adds: ‘It’s likely that three or four auc­tion houses might drop out within the next six months.

‘This trend in re­cent years for 5% buy­ers’ pre­mium is un­sus­tain­able. Auc­tion houses that use these and 0% sell­ers’ pre­mi­ums will go down by July.’

CCW’s auc­tions ex­pert, Richard Hud­son-Evans, agrees that this mar­ket is un­sus­tain­able. He says: ‘There are too many cars be­ing chased and sought by too many auc­tion com­pa­nies. Fast Fords sell par­tic­u­larly well at auc­tion, as do MGBs, and 1980s and ’90s BMWs.

JUSTIN LAZIC, CLAS­SICS CEN­TRAL

Nowa­days, quite a lot of buy­ers are us­ing an auc­tion as a first port of call, whereas tra­di­tion­ally, it was con­sid­ered a last re­sort.’

An­other rea­son be­ing tipped for the pop­u­lar­ity of auc­tions is the abil­ity to en­ter cars a mat­ter of days be­fore the sale. ACA has been known to ac­cept cars the day be­fore sale, and H&H con­signs cars just days be­fore its sale. Sell­ers can now place a car for sale, and if it doesn’t sell, place it in an auc­tion that week­end.

How­ever, club mem­bers will most likely re­main un­af­fected, ac­cord­ing to Chris Kynoch, PR & So­cial Me­dia Of­fi­cer of the MG Car Club. He says: ‘A lot of our mem­bers don’t need to sell through auc­tions. Clas­si­fieds in our club mag­a­zine typ­i­cally fea­ture around 20-50 cars for sale. Club mem­bers know each other well – and they en­joy buy­ing and sell­ing from one an­other. We don’t hold auc­tions even at an event like MGLive!.’

More and more own­ers of com­mon­place clas­sics are turn­ing to auc­tion houses.

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