Buying Models for Investment - Good or Bad?

[dvdlcs]

Most of the responses seem to have considered RTR models.

 

I did wonder about kit built locomotives and coaches, that had been built and/or painted by well-known craftsmen, possibly in the larger scales.

 

But as others have mentioned, not only do you have to receive more units of currency than you paid out, but beat inflation etc. too.

[hayfield]

45 minutes ago, PMP said:

There is some money in kits, however it’s the small production runs and ‘closed’ manufactures that will hold value and increase if the prototype isn’t duplicated. The kit has to be a reasonable quality (or perceived to) to have value. I’ve a number of unbuilt Impetus D&S, ABS and backwoods miniatures kits that I know would sell well, even allowing for inflation. If they are duplicated by either contemporary quality kits or RTR, their value will fall through the floor. So not an investment, just lucky market forces.

 

I think like most older people we bought items many years ago only to find that if we wanted (or did ) to sell them we now would get 20 to 30 the price we paid. Or bought something 20 or 30 times the old price sticker which is on the part, Example a Romford insulated loco wheel from HA Blunt in Mill Hill 1/11d (10 p in new money) they are now £6.60. Now this was more like the effects of inflation, the wheel was never bought for investment nor will it be sold as an investment, however may well have done far better that most shares over this time

 

37 minutes ago, njee20 said:

Caveat: I model N gauge, so I don't know what the market is like in comparison.

It's a balance between something being worth more because of inflation/price rises, and just being old and obsolete. I'd suggest it's a loose bell curve, where price rises for a bit to a peak, then a new model comes out and value falls away very sharply.

I've sold huge amounts of stock at a profit, simply because the prices have risen. Locos actually aren't overly lucrative, but wagons are. Things like Farish's HTAs, JPAs and FIAs were all £15-20 each brand new, and often less second hand (at the time), but regularly fetch 2-3 times that now either because they're scarce, or the new retail prices are far higher (£80 in the case of the FIAs). That's not to say I envisage that carrying on indefinitely, because at some point they'll be superseeded and/or will fall out of favour. I'm happy to admit I've bought entire collections from people and then sold them in as individual lots where the original owner hasn't fancied it. I've made several thousands pounds of profit over the years. One or two things have lingered a bit.

I've had one or two bizarre things that have gone crazy - Dapol FGW buffets were going for £150 at one point, I was happy to relinquish one. 

I'd not buy models "as an investment to put toward my retirement", becuase I figure by the time I get there they'll be worth far less, just becase they'll be old. I'm only 32 though, which I guess has a bearing.

 

I think most of us have seen the market move, when Hornby Dublo went bust my dad bought me a Co Bo loco and an electric coach (motorised) for £1 each from a warehouse in Shoreditch, I played with them they were play worn and missing an odd side frame or two.

 

11 + years ago I sold them as I stopped using 3 rail 40 odd years earlier, they had boxes but as I said playworn. The coach sold for £250 and the Co Bo for £80, I think now they are worth far less. There are fads that folk must have and I took full advantage of their prices at that time. The funds I got from selling these went straight back into better models. They were never bought as an investment nor will the locos I bought be an investment, I assume I will loose most of their value over time. The originals I got a lot of fun out of when a child and by shear luck they got me some nice models

[hayfield]

58 minutes ago, dvdlcs said:

Most of the responses seem to have considered RTR models.

 

I did wonder about kit built locomotives and coaches, that had been built and/or painted by well-known craftsmen, possibly in the larger scales.

 

But as others have mentioned, not only do you have to receive more units of currency than you paid out, but beat inflation etc. too.

 

I have a friend who gets the odd 0 gauge loco built each year, if his beneficiaries are lucky they will get the cost of the parts back, but not what he paid in total. With the increase of RTR 0 gauge s/h prices of kit built items seem in general to have fallen

 

Just look at second hand prices for 4 mm scale loco kits and kit built locos, many not even making the price of the kits let alone the cost of additional parts, or if made for them the build costs. 

 

Also the bubble seems to have burst on the resale market of the famous builder names

 

But for rare prototypes well built do fetch good prices, not necessarily a profit against their cost though.  But there will always be exceptions

 

I think though there are two things which we may mix up, as a long term investment very few models would fit into this category. However it is quite easy to buy something and find over the short term you have made a profit, the grey area may be if we dispose of something over the medium term and sell it for more than we paid for it have we just been lucky to make a profit or was it a wise investment

Edited January 9, 2020 by hayfield

[Nearholmer]

Agreed Hayfield: I was thinking this thread was mixing ‘investment’ and ‘short-term speculation’, which to me at least are rather different things. Building society vs a flutter on the nags, to use old-fashioned analogies.

 

Short-term speculation in models might be profitable if you spread your bets wisely, but to make a worthwhile amount from it you’d have to lay out so much, and stash so much, that you’d effectively become a dealer, and you might be tying-up money that could do better elsewhere.

[Steamport Southport]

On 08/01/2020 at 10:53, Nearholmer said:

 

Play with 'em!

 

This.

 

If you want to make money on collectables then go for something that you can easily part with. As an example, a lad I know has a massive collection of Status Quo memorabilia. Worth an absolute fortune, but he'll never part with it. So it's value is irrelevant to him as he'll probably not see a penny of it.

 

That's the secret of successful antiques dealers. They don't collect the items they buy.

 

 

 

Jason

[sjp23480]

15 minutes ago, Nearholmer said:

Agreed Hayfield: I was thinking this thread was mixing ‘investment’ and ‘short-term speculation’, which to me at least are rather different things. Building society vs a flutter on the nags, to use old-fashioned analogies.

 

Short-term speculation in models might be profitable if you spread your bets wisely, but to make a worthwhile amount from it you’d have to lay out so much, and stash so much, that you’d effectively become a dealer, and you might be tying-up money that could do better elsewhere.

 

Hornby's Sir William Stanier was a good example of short term speculation, but the bubble soon burst when the 2nd production run came to the market. 

Edited January 9, 2020 by sjp23480

[melmerby]

The only item I ever sold at a profit was a Hornby Dublo AL1 which I bought new and paid 67/6d for, used it a lot then sold it in the 2000s for £100 to a second hand train dealer.

[royaloak]

12 hours ago, MrWolf said:

So my parting shot was: "Would you marry a Hollywood actress and then sleep on the couch every night?"

 

Brilliant one liner, I will remember that.

[HonestTom]

I have bought things for resale in the past. For instance, when the Hornby Peckett was first released and sold out immediately, I found a whole lot in a department store that were in the January sale, so I bought one for myself and covered the cost by slinging a second one on Ebay. Of course, now there's no shortage of Pecketts, which leads me to wonder how much the ones I bought will be worth in the future.

 

I think part of the problem with buying for long-term investment is that the market has changed. When the likes of Hornby Dublo and Triang ruled the roost, model railways were aimed primarily at kids. Concepts like limited editions and collectability weren't really a thing. Trains were played with. Now, models are aimed at the adult collector, produced in smaller runs at higher prices and with greater detail. Aside from those who customise their models, I would say that proportionally, a far greater number of models are kept in good condition. I guess it's hard to predict the future, because the era of super-detail is a relatively recent thing. It's hard to say what the market's going to be like down the line.

[gordon s]

4 hours ago, dvdlcs said:

Most of the responses seem to have considered RTR models.

 

I did wonder about kit built locomotives and coaches, that had been built and/or painted by well-known craftsmen, possibly in the larger scales.

 

But as others have mentioned, not only do you have to receive more units of currency than you paid out, but beat inflation etc. too.

 

Going back to my working days I commissioned around 15 locos to be built in 4mm. All were built and painted by a professional (well known) loco builder. Most of them were LNER locos, but generally they were of prototypical locos that weren't available RTR at that time or if they were, the quality of the RTR item left a lot to be desired. Naturally I'm very loathe to sell any of them, but looking at the prices of professionally built kit locos, I would be surprised to recover much more than I paid 15 years ago. I haven't checked recently, but when I last looked on eBay, similar locos were being sold for £200 - £300 which is less than I paid all those years ago.

 

Just checked on an inflation calculator and £300 in 2005 is still only £313, so inflation has been virtually flat over 15 years.

[Clive Mortimore]

My non-railway modelling friends often comment that my train set must be worth a lot. It is to me, it is priceless but when I pop me clogs I hope the kids can raise enough money from what they can sell to pay for a skip for the rest.

 

Any collection of anything is only worth something if there is a buyer, otherwise it is for recycling. 

Edited January 9, 2020 by Clive Mortimore

[andyman7]

Treating model railways as an investment is risky and unsatisfying. What is more useful is to learn from your experiences to try and help fund your hobby - as numerous posts have shown here, there is quite a volatility to models, with prices shooting up and then dropping back. Beacuse of the batch nature of production, if I like the look of something I will tend to buy it. If the price rockets, I tend to take the view that I'll take the money on offer at that point to sell it. More than once I have then subsequently bought another example when prices fall back, therefore effectively subsidising the purchase. If I see a model is easily fetching x on ebay and find it for sale for less, I will buy and sell it on - the money all gets recycled in the hobby and lets me buy other models that I would otherwise find it hard to justify.

 

By the way, the current record holder for financial appeciation is by my reckoning, the Hornby R9684 Thomas version of 'Murdoch', basically a 9F in sand with a face. I bought one in around 2012 for £80. Subsequently Model Railways Direct were flogging them off for £58 and they had dozens in stock. I'd thought about giving it to my son when he was old enough but by that time they were selling for over £200 which I though was bonkers so sold it to fund other things he would like.

 

They are currently fetching over £500 each....... 

 

 

[gordon s]

Quick, order half a dozen.....

 

Is this the same one?....

 

https://www.southvalleycab.com/index.php?main_page=product_info&products_id=27138

[andyman7]

Yup, that's the one!

 

[gordon s]

Apparently a translation says they have 54 in stock.......

[melmerby]

23 minutes ago, gordon s said:

Apparently a translation says they have 54 in stock.......

What a mix of Italian and English

They have some of these in stock: "FLYING SCOTSuomo"

 

And why are their items so cheap?

Edited January 9, 2020 by melmerby

[andyman7]

That picture is off an eby listing. Look at the other items too, the whole site has scam written all over it......

[Dungrange]

3 hours ago, melmerby said:

And why are their items so cheap?

 

I think it's just a site to harvest credit card details.  I don't think there is any details on the website of a physical address at which the business is supposed to be based or even what country it is based in.  That therefore means when you don't get what you ordered, there is not a lot you can do.  There doesn't even appear to be a phone number - just an e-mail address and chances are any e-mail will be ignored.

[nerron]

13 hours ago, PMP said:

Impetus D&S, ABS and backwoods miniatures kits that I know would sell well, even allowing for inflation.

Two recent sales on Ebay.D&S NER 12 wheel Dining Car 93GBP and NER Clerestory 3rd 70GBP. I was tempted by the Dining Car but Ebay's outrageous International shipping costs and import duty (which does not apply!) made resistance easy

 

[The Johnster]

On 09/01/2020 at 02:15, MrWolf said:

I couldn't agree more. American car collectors have a saying: "The more there were, the less there are" The workaday items that 30 years ago were everywhere, are now gone. Most people know that Mk1 Ford Escorts are now silly money, initially the 2 door saloon, everyone wanted and other variants were mercilessly broken up for parts to the point that there were virtually non existent. This has caused their values to rocket in comparison. My models are bought to use as intended (otherwise why bother putting electric motors in them) I remember a workmate in the 1990s collecting all the limited edition Lima diesels, when he decided to sell, he found that everyone and his dog had done the same thing and struggled to get his money back. I have vintage bicycles and motorcycles, I ride them all, regularly. I remember a complete stranger at a petrol station indignantly telling me: "You shouldn't be thrashing that about! It should be in a museum!" No amount of reasonable argument that I had pulled it out of a hedge and spent three years rebuilding it to perfect running order and if I blew it up, I would rebuild it again made any difference. So my parting shot was: "Would you marry a Hollywood actress and then sleep on the couch every night?"

 

Just my $0.02!

I would if it was Kathy Bates...

[The Johnster]

9 hours ago, Clive Mortimore said:

My non-railway modelling friends often comment that my train set must be worth a lot. It is to me, it is priceless but when I pop me clogs I hope the kids can raise enough money from what they can sell to pay for a skip for the rest.

 

Any collection of anything is only worth something if there is a buyer, otherwise it is for recycling. 

My ‘train set’ cost a lot, but is probably worth very little in resale terms as I’ve  improved all my RTR items, nullifying their ‘as new’ status.  This is of no consequence to me as I have absolutely no intention of selling any of it.   But there is the matter of estimating cost of replacement for insurance purposes, a minefield if ever there was one!

[Barry O]

9 hours ago, Dungrange said:

 

I think it's just a site to harvest credit card details.  I don't think there is any details on the website of a physical address at which the business is supposed to be based or even what country it is based in.  That therefore means when you don't get what you ordered, there is not a lot you can do.  There doesn't even appear to be a phone number - just an e-mail address and chances are any e-mail will be ignored.

 

Yes be very wary. EBay are not good at policing certain aspects of their site.

Baz

[Barry O]

7 hours ago, nerron said:

Two recent sales on Ebay.D&S NER 12 wheel Dining Car 93GBP and NER Clerestory 3rd 70GBP. I was tempted by the Dining Car but Ebay's outrageous International shipping costs and import duty (which does not apply!) made resistance easy

 

Write directly to Dan Pinock ..he supplied me with new NER Clerestory kits at £32 a pop a couple of years ago...

Baz

[MrWolf]

Speaking of D&S, the last time I bought an obsolete white metal kit of theirs for an outside framed GWR toad brake van, it cost me £15 on Ebay, I have just watched one hit £64. Is it worth that much? Not to me, but two people who have got to have it and the price isn't important, I guess it was. It's probably more to do with the fact that nobody makes one anymore, but I am convinced that something is only worth what someone is willing to pay for it and in some cases, to make sure someone else doesn't get it. I go to a lot of antique auctions with my work and find the whole auction fever bidding war scene just like being back in junior school. It's amusing because it's costing me nothing. Of course, if there's a bidding war over something I found on a junk pile, it's even more amusing!

[MrWolf]

18 hours ago, The Johnster said:

I would if it was Kathy Bates...

Hm, that isn't who I had in mind and I suspect you knew that!

Insert list below of all Hollywood actresses you would like to show round your railway room....