The pool of old bikes now consists fewer unmolested originals and barn finds, and more previous restorations many of which have been buggered up by unqualified people. Entering such bikes is a mechanic's minefield. So the risks of restoration have increased: the chances of finding odd and expensive problems, the chance of not having the resources to deal with an unusual problem properly.
The costs and risks have raised the price of restored bikes. In 1985 BMW Motorrad of St Louis sold a /2 they restored for $2,500 and complained that it was becoming too expensive to do more of them. Dealers could not afford to restore and sell bikes, and the activity passed more into the hands of owners who acted as general contractors and assemblers without valuing their labor.
By the mid-90s it cost $10,000 to buy and restore a /2. By 2002 it cost me $12,000 to buy and restore a /2, and one of my bikes contained very odd problems caused by a previous restoration. In 2005 I knew someone who had spent $18,000 to buy and re-restore a previous restoration, and that was before the newly rebuilt crank broke after a few months and the engine had to be re-done.
The rising cost of restorations eventually pulls up the prices of all the bikes.
Interesting insight... I've been feeling better and better about my 2-year old purchase of an R69S. From the kinds of things I've been seeing for sale, I think I got a good deal. It seemed expensive at the time, though. I have spent the "usual" amount on just the mechanical restoration so far. During that process, the rebuilder found, you guessed it, a botched valve job done previously. The bike was running OK, but it eventually would have caused me problems. You just can't tell by looking at it or even driving it around...you've got to get inside to see the true state of things. And be ready to open the wallet to fix it right.
Kurt in S.A.
'78 R100/7 '69 R69S '52 R25/2
While I can't prove it, I suspect the bull run in the stock market (in which just last week the Dow closed above 13,000 for the first time) and the easy credit that has been available has pushed up the prices. Now that the economy is slowing, lenders are getting a bit tighter on who and how much dosh they hand out and the housing market is in a downturn, I wonder if the prices won't level off, if not fall back some.
I may still be underwater on my R12, but at least I can see the surface now.
That's what it costs to pay a pro for his time and expenses on a turnkey restoration.
Many owners do what I did. Disassemble the bike into major components, send them to specialists for rebuilding or painting or chroming, place most of the parts orders themselves, and reassemble the bike. Each of my three bikes took a winter of my part time work doing that, over a hundred hours per bike at no cost.
I tell you exactly why. Its not that the bikes are quickly becoming more valuable. Its that the dollar is becoming quickly worthless. For those out there who do not sell and buy abroad this is difficult to initially understand. The value of the dollar has dropped so drastically that the market (which is now international) has reacted by buying up the post war BMW's here in this country which are now a steal.
Here's the math:
A 1965 R60 that is worth, lets say, $4000 5 years ago would have required a foreign buyer to come up with approximately 4,650 euro to purchase. If we assume that in europe the value in the last five years did not increase at all (which I don't believe but we will use for this example). they could buy the same $4000 R60 for only 2,900 euro. So in essence its the fact that the dollar is quickly decreasing in value against foreign courrencies that is causing the value to go up. These bikes are now cheaper here in the US than they are in Germany. I travel there several times a year and see that in euro they are not appreciating quickly but given a small increase in international value tied to the diving dollar, it appears their prices are going way up.
You should follow the pre war bike values for a real scare.
Peter D. Nettesheim
I can appreciate that. But I was not really referring to the price of bikes bought abroad with dollars. I am only familiar with buying and restoring mid-60s bikes in the US.
I do understand about parts prices. When I began restoring my current batch of bikes in 1999, the Swiss Franc was $.60 and now it is $.82. Mobile Tradition parts have gone up $.22 for every dollar spent on them.
The number of qualified people able and willing to work on the old bikes seems to have declined, and their rates have gone up.
And the risk factor has increased. When I had my R60/2 rebuilt, it already had knurled crank seats, peened valve seats, mismatched timing gears, and a cylinder that had been rebored conically and diagonally. When I bought new rod sets for my R69US, the weights were matched, but one crank pin was shorter for an R60/2. After Bley Engineering stopped rebuilding cranks, another person took their place, but now his cranks have had some failures. Restoring a /2 is no longer as predictable as it once was. A rebuilder who estimates a price, or who guarantees his work, must think more carefully now.
With regard to Peter's comment, I think he's correct. I recently listed my R67/2 on EBay and had more inquiries from Europe than I ever would have expected.
As soon as my Indian sells, I'm llooking for a good rider.
The thing about the prices going up- I think it's like the stock market; A couple of bikes get bigger money and all of a sudden everyone is sitting on a gold mine. I can see a recent resto going for more because of parts prices, but bikes that were restored 10 or more years ago are asking just as much money. Sort of like soda pop going up because corn prices are up so corn syrup costs more. Only thing is, the diet sodas go up, too.
My view is that vintage BMW in Germany have always commanded higher prices than in the USA, even at €/$ parity. The Euro and the internet have tended to equalize prices throughout Europe, although I believe BMW tend to cost a bit less outside of Germany. The current exchange $/€ rate makes it that much more painful for those of us paid in $ (don't feel sorry for me;-). As a result, there are a lot of older European cars and bikes being repatriated from the Americas.
Having said that, there is also more money (of all currencies) chasing a limited amount of 'collectables,' which is driving up the prices of vintage cars, bikes, art, etc. I believe this more the cause of the recent (12-18 months) surge than the currency issue because it seems to be happening in Europe as well. In any case, the 'double whammy' is brutal.
I don't collect bikes as an investment, but because I enjoy the history, industrial art, restoration, tinkering and, of course, riding them.....it is a hobby. Unfortunately, the current economic situation makes it harder to enjoy and I do not see it improving any time soon. The housing situation in the USA may take some liquidity out of the USA collectable markets, but that is not an issue in Europe and the experts say that a weak USD relative to the Euro will be with us for a while.
A few years ago, I met a representative of a Japanese consortium here in Atlanta whose only job was to travel the U.S. and buy vintage Japanese and European machines. What a job! Anyway, he would pay top U.S. prices and ship the bikes home via airborne containers. I sold him a '75 Norton Commando 850 in top shape for top price and he was only too happy to get it. He knew his stuff, though. No restos, no repro parts.