Intangibles
What is the value of a car? My attitudes have gradually changed over the years. I’ve found that a significant part of this attitude shift is the fact that I don’t really NEED a car. That is a powerful idea. Leveraging that attitude grants a huge amount of flexibility. If you’re not obsessed with finding the PERFECT car, and needing it to be PERFECTLY reliable, you can easily re-focus on the intangibles of vehicle ownership. It also helps to be relatively spartan in your tastes; cutting back on luxuries absolutely enhances the experience. Somehow, heated seats aren’t a real sacrifice if a car is designed to carve up the perfect corner. Join your local BMWCCA or whatever brand/vintage/category you like and take a few rides. You’ll figure out very quickly which machines are best for you.
Of course, prudence and common sense should rule your decisions. I’d strongly suggest setting up a budget first for your toy. I’ll be honest, without a spreadsheet it will easily get out of control. Combine that with the time you’ll invest, this makes absolutely zero sense financially. Thus I’d recommend judicious compromises. But buy something reputable enough for your wife/S.O./CFO to tolerate. Make sure it’s still fun enough for you, and prepare for mistakes. Also prepare yourself for plenty of [well-meaning & well-deserved] feminine/effeminate criticism when it breaks. That’s the cost for your non-conformist (tom)boyish attitude, and it’s one of the charms of owning an older car. Period. Should the most important non-car-enthusiast in your life ever completely approve of such a thing? This is your hobby, for better or worse. Don’t fear the testosterone. If more responsible parties have decided that it’s juvenile, that’s their problem, not yours. They’re right; it is a little childish. Is it the most fun you can have with your clothes on? Probably not. But the kids love my ratty old cars…and I have a ton of fun messing around with my buddies. I don’t feel the need to apologize, and neither should you. Mother was never that good at picking out cars anyway.
For example, my brother has been shopping for a car. I figured a fair compromise for his needs and driving style might be an E46 330i 6-speed with the factory “ZHP” package. The E46 has a lot of advantages. It’s a comfortable car, commonly available, certainly not spartan, relatively safe, and still new enough to be supported by BMW dealers and parts networks. The ZHP option package is somewhat rarer. It’s well known among enthusiasts, so it’ll be costly, but it should hold value fairly well. Other choices include: lucking out by finding an E46 or E90 optioned out with a few of the M-Tech goodies; or installing your own suspension and engine mods. The former is a little too random, the latter usually murders the resale value. In my humble opinion, those poor alternatives make the ZHP package a very appealing choice. BMWs like the ZHP are not softened up for typical American performance and ride criteria. Thus the M-Tech handling & appearance goodies made the cut, but the pricey Motorsports engine options didn’t. The ZHP, like many earlier ‘M-Sport’ or ‘Sport’ models, were designed by genuine hard-core automotive engineers for people like us. They have more of what makes a BMW fun to drive, and less of what makes a BMW unreliable and pricey to own.
So, just for fun, I’ve been checking out ads for the ZHP. They’re surprisingly expensive cars considering what you get. However, using my calculations, that car is actually very undervalued. Newer BMWs all use electrical steering. It’s not a bad idea, but it’s not as nuce as the older cars. That’s a significant negative, isn’t it? How often will you turn the wheel? The ZHP is also a decently analog car, perhaps one of the last BMW will ever build. Given that end-of-the-line status, a well-used $6K ZHP might actually be an outright superior car to something like a brand-new $40K 3-series. Valuing a car based on ‘new’ or ‘used’ is baloney if you’re willing to maintain them; so I compare used cars straight up with new ones. Most new cars don’t have the character of the old ones, although newer tends to be easier to live with. That’s a trade-off I’m willing to make. If it’s something I want (I prefer analog and weird, don’t mind discomfort), I’ll pay the going price. It’s a cheap luxury, especially since it’s so overwhelmingly cheaper than buying a new one. If you’re not constrained by those financial considerations as tightly as I am, your math is a lot easier.
Other Risks
There is always the risk that you’ll miss a critical detail in buying used parts. Perhaps it’s a damaged part; I’ve bought many of those. It may be mislabeled or misrepresented; I’ve done that too. This isn’t an uncommon occurrence. Don’t let it get to you, anything worth doing is usually all about learning.
It’s often been said: “Knowledge is power.” I’m sure that’s true. I’d like to add: “Knowledge is profit.” Having a little understanding of your market can pay [small] dividends over a reasonable time frame. My leverage in 80s BMW parts trivia gives me a small advantage in re-selling parts. I have an idea of what’s worth re-selling, and I try to keep my eye on what the ultimate value is. It’s rare that I lose money on a car, but selling project cars will not make you rich. The real money down here at the bottom of the market is in parts. A complete pile of junk could well be worth thousands, but you have to be persistent and diligent. You also need to know exactly what they have. As in all things, it never hurts to get a little lucky.
These sorts of deals are problematic, since you need to understand exactly what you have in order to sell it. Timing is important too.