Guitars as Investments
14/02/08 21:42 Filed in: Guitar Investing
Thirty years ago guitarists started to realise that the older guitars made by Fender, Gibson and Martin where far better guitars to play than the new products from those manufacturers. They also sounded better than the newer counterparts, and so the value of these older guitars steadily increased over the years.
In the last couple of years in particular, they have sky rocketed in value to figures that would astound the average investor. Vintage Guitar Magazine (The industry bible) developed the “The 42-Guitar Index” in 1991 which tracks excellent condition original pre-1970 Gibson, Fender and Martin guitars. The average value of an instrument in that index for 2007 is a healthy US$19,706, which represents a 438% increase since 1991 - an average of 27% compounded annually. The bulk of that growth as I said previously, has occured in the past few years with last year alone showing a spectacular 54% increase.
According to the Vintage Guitar blog, it is Gibson that is leading the field when it comes to return on investment. "Gibson outranks all other vintage guitar brands in terms of increase in value over the past 20 years slightly edging out Fender and far exceeding Martins. As an extreme, an all original museum quality 1959 Gibson Les Paul Standard may soon fetch US$500,000!"
The custom colour Fender Stratocasters are also highly sought after, still. "Here are the numbers on a 1962 Fiesta Red Slab Stratocaster from 1996 to 2007. It was easier to find one in 1991 for an average price of US$10,650. Try to find one now that they average US$41,500 - that’s a low of 29 grand and a high of US$54,000."
For those who manage their own self managed super fund, did you know you can in fact use your super funds to invest in a guitar? Or how about sinking your retirement money into a guitar?
An article in the Aspen Times talks about a guy trying to buy a house: "He was eager to buy a piece of property in the Crystal River Valley south of Carbondale last year, complete with a barn and enough land to have a couple of horses, but he didn't have the cash needed for the down payment."
So what did he do? "He plucked a Gibson "Gold Top" electric guitar out of his collection and sold it for US$400,000, enough to make the down payment and move into his dream home overlooking the Crystal."
It is staggering to think of the value of these guitars, and for years all of those in the business of buying them, have said: "It has to end soon, they can not keep going up", but history is proving us all wrong. At various times the prices will 'settle' for a while, but rarely if ever have they gone backwards, and the climb into the stratosphere in terms of prices, is continuing along at an unprecedented rate.
So it is never too late to 'get in' the market for a prized guitar, it can however be a traitorous thing when you do not know what you are buying. It is critical to buy from a reputable dealer, and from someone who has been dealing in these precious instruments for many years. Steve Jackson is Australia's largest dealer and knows his stuff, and with the 100% Trade Up offer at Jacksons Rare Guitars, you can not go wrong.
In the last couple of years in particular, they have sky rocketed in value to figures that would astound the average investor. Vintage Guitar Magazine (The industry bible) developed the “The 42-Guitar Index” in 1991 which tracks excellent condition original pre-1970 Gibson, Fender and Martin guitars. The average value of an instrument in that index for 2007 is a healthy US$19,706, which represents a 438% increase since 1991 - an average of 27% compounded annually. The bulk of that growth as I said previously, has occured in the past few years with last year alone showing a spectacular 54% increase.
According to the Vintage Guitar blog, it is Gibson that is leading the field when it comes to return on investment. "Gibson outranks all other vintage guitar brands in terms of increase in value over the past 20 years slightly edging out Fender and far exceeding Martins. As an extreme, an all original museum quality 1959 Gibson Les Paul Standard may soon fetch US$500,000!"
The custom colour Fender Stratocasters are also highly sought after, still. "Here are the numbers on a 1962 Fiesta Red Slab Stratocaster from 1996 to 2007. It was easier to find one in 1991 for an average price of US$10,650. Try to find one now that they average US$41,500 - that’s a low of 29 grand and a high of US$54,000."
For those who manage their own self managed super fund, did you know you can in fact use your super funds to invest in a guitar? Or how about sinking your retirement money into a guitar?
An article in the Aspen Times talks about a guy trying to buy a house: "He was eager to buy a piece of property in the Crystal River Valley south of Carbondale last year, complete with a barn and enough land to have a couple of horses, but he didn't have the cash needed for the down payment."
So what did he do? "He plucked a Gibson "Gold Top" electric guitar out of his collection and sold it for US$400,000, enough to make the down payment and move into his dream home overlooking the Crystal."
It is staggering to think of the value of these guitars, and for years all of those in the business of buying them, have said: "It has to end soon, they can not keep going up", but history is proving us all wrong. At various times the prices will 'settle' for a while, but rarely if ever have they gone backwards, and the climb into the stratosphere in terms of prices, is continuing along at an unprecedented rate.
So it is never too late to 'get in' the market for a prized guitar, it can however be a traitorous thing when you do not know what you are buying. It is critical to buy from a reputable dealer, and from someone who has been dealing in these precious instruments for many years. Steve Jackson is Australia's largest dealer and knows his stuff, and with the 100% Trade Up offer at Jacksons Rare Guitars, you can not go wrong.
Interview with Steve Jackson on the TV Series 'The Collectors'.