Many cars sell for $60,000 to $75,000-about the cost to restore a solid original car, if you know what you're doing
With only one "Gee whiz, what-was-he-thinking? over-six-figures" Austin-Healey sale price in Scottsdale in January and one fairly respectable car that sold for less than $25,000, some folks are asking whether the recent run-up in big Healey prices resembles the Jaguar and Ferrari bubbles of the late 1980s.
To gain perspective on where they might be going, let's look at where Healey prices have been. As readers of this magazine, we can study the auction sales chronologically over the past ten years in the SCM Platinum Database. The system even shows us a graph of average sale prices by year.
Historical perspective is a wonderful thing. Based on SCM data, my conclusion is that there hasn't been a bubble in prices, and we're not in for a meltdown.
In the late 1990s, a very nice Healey could be had for about $25,000; auction prices were pretty much the same as private market prices. At those levels, auction prices didn't pay for the cost of good restoration work. However, if you did some of the work yourself, factored in the enjoyment of ownership, and kept the car for a few years before selling it, you wouldn't feel cheated by selling at what the auction markets were offering.
Wilson and Tanner raised the bar
But soon after we stopped worrying about Y2K, things started to change. A few good restorers like John Wilson and Kurt Tanner restored some Healeys on spec and took them to Scottsdale and Monterey for sale. Doing obviously high-quality restoration work on cars that were in good shape before they began, they were able to sell their work for unprecedented prices ($30,000-$40,000), and everyone wondered if those Healeys were overpriced.
Even with these examples, a fair number of Healeys were still coming to auction in middling condition, so average prices stayed just below the $30,000 mark until 2003. In that year and the following year, a greater number of excellent new restorations came to market with sale prices in the high $40,000-range, pushing the average price up to the mid-$30ks.
By 2005, things had changed completely from the earlier years. Very few down-market Healeys were finding their way to the auctions, Jaguars were getting too pricey, and a growing number of Baby Boomer collectors were starting to bid up the limited Healeys available.
With top prices pushing up toward six-digit Jaguar territory, it was making sense for the restorers to expand the business of restoring Healeys on spec, and more high-quality, freshly-restored Healeys crossed the block.
In 2005, with two bidders competing for the last Healey on the block at Barrett-Jackson, one was hammered sold at $97,200. More telling, there were a significant number of restorers' cars selling in the mid-$70,000-range, moving average prices for the year up another $6,000 dollars.
Fresh restorations drove up prices
In 2006, the same situation developed again, as a 1960 3000 drew $135,000 at Barrett-Jackson's Palm Beach sale in March and a '67 sold for $99,875 at Christie's June sale in Greenwich, Connecticut. While average sale prices increased almost $10,000, the rise seemed due to the dearth of average or below-average cars, while fresh restorations were selling for around $75,000.
When the fundamentals of supply and demand and restoration costs-rather than emotion-actually determine prices, ceilings are eventually reached, and that's what happened in 2007.
One Healey, a 100M with strange red wheels, did score an inexplicable $231,000 last year, but other than that, the remaining sales were a repeat of 2006. A double-handful of freshly restored cars from known restorers sold in the $75,000-range, and most of the others went across the block within a narrow range of the average price of $51,000.
During the January auctions this year, prices were at almost the same level as 2007, suggesting that the big Healey market has stabilized, at least for now. Including the Kruse Ft. Lauderdale sale, a dozen big Healeys crossed the block in January.
Only one car-an always-desirable late Mk III convertible in a traditional color scheme-broke the $100,000 barrier. No surprise that it was restored by Kurt Tanner, who is almost a brand name now, having sold his restorations at the major auctions for over ten years. Tanner is known for always producing no-problem cars. Since Healey buyers seem to rate fun over investment, many of them value usability more than exacting (and sometimes questionable) originality.
At the other end, only four cars sold for less than $50,000, suggesting once again that average Healeys and older restorations aren't showing up at auction. If you're looking, there always seem to be a reasonable number in the club magazine for-sale ads and also available for private sale.
In the middle, we find more than half the cars selling for prices from $60,000 to $75,000. That's enough money to pay for a decent restoration on a solid original car if you know what you're doing. It also makes sense for an older car in good condition where you can go through it mechanically and give it a new interior and nice paint job, then put it back on the road for a proud new owner.
A few years ago, when the first Healeys broke the $100,000 barrier, I went on record to say these sales were anomalies and weren't likely to mark any kind of new trend. At the risk of blowing my own horn (which works even if Lucas-based), I believe that the auction sales since have borne that out.
Aside from the factory-produced 100S racers, which have passed the $250,000 mark, and the 19 existing Works rally cars (top price $323,000 for Pat Moss's car), there aren't many rare Healeys. The Healey Hundreds with factory-installed Le Mans modifications that we call the 100Ms can command a premium, but the fundamental costs of restoration dictate maximum prices.
However, the supply is fixed and the demand is increasing, thanks to Boomers (as long as they can get in and out of a low-slung two-seater, anyway). With restoration costs dictating sale prices, I don't see any drop in prices in the near future. My conclusion is that Healeys are still good value. They may offer little opportunity for quick profit, and the long-term appreciation may be moderate, but as long as the car is carefully bought, there isn't much risk of loss.
If I were searching for a really undervalued car, I'd be looking for a properly restored Triumph TR3, or maybe a TR4. I think both cars are where Healeys were ten years ago. They're fun to drive, they can keep up with modern traffic, and good ones can be bought for less than restoration costs. As long as that situation persists, buyers have the advantage.