Ever notice the guy at your cousin's wedding, endlessly scrolling through his Blackberry during the service?
Are you a collector or flipper? I find it makes all the difference to your enjoyment of the hobby to understand who you are and what you are doing. To see how you rate, take this little test. Don't worry about the outcome, as both collectors and flippers can live happily ever after.
Check your responses: True or False.
1. I tend to own my vintage Porsches a long time.
2. I tend to like times when prices go up quickly.
3. I find it great fun to work on my Porsches or have them upgraded by professional shops.
4. I tend to make a decision on buying a Porsche based mostly on what I will be able to sell it for.
5. I like to drive my Porsches and do it as much as possible.
6. I have quoted recent sale prices in my ads when I have a Porsche to sell.
7. I love to read arcane facts about Porsches and buy most every book written about them.
8. I use eBay and Craigslist frequently to buy and sell.
If you are a true flipper, your first answer will be False and then will alternate between True and False. If you are a collector, you'll have the opposite responses.
Whichever you are, take heart, because both can have a great time in the Porsche hobby. But it's important to be honest with yourself and realize on which side of the great divide you reside.
Here is a little more detail. Starting at question number one, ask yourself: Is that recently purchased Porsche burning a hole in your pocket? Do you find you own cars just for brief moments? How many Porsches have you had for five to ten years? If you've had most for a long time but a few come and go quickly, then you are a collector who simply makes some mistakes along the way. Alternatively, if you have a few Porsches you've owned a long time but mostly cars come and go, you're a flipper.
Collectors love quiet times in the market
Question Two: Porsche collectors love a quiet time in the market, because that allows them to buy cars no one else really wants without having to fight off hordes of momentum-crazed "investors." Flippers hate quiet times, and only want to buy Porsches with strong and rapid appreciation, as that is the best way to make money on the in-and-out. Fact is, flippers go for everything-new, old, fancy, plain, whatever. The bottom line is, can they make a buck on the deal? Oddly, they do seem to be attracted to fast and flashy slantnose Turbos, even though while cheap to buy, they are hard to sell. By contrast, a collector may be happy with the low-key, modest 356A he's owned since college.
Three: Porsche collectors love to work on their cars or have them upgraded, and can spend months, even years, studying and planning what to do. Flippers hate to fix their cars, as the work raises the selling price or lowers the margin. Does it hurt you each time something breaks on your Porsche? Do you cringe at the thought of getting it fixed? If so, you are a flipper. If you look at each repair as a chance to learn something, then you are a collector.
Question number four posits that collectors visualize using and enjoying their potential purchase. Flippers look at each Porsche simply in terms of margin: How much can I make from selling it, especially if I can find that special customer willing to pay that special price?
Five: Porsche collectors love to drive their cars; it is part of their joy to be transported back to earlier times. Flippers hate to drive their cars, as something may break or be damaged that will cost them money to fix. They mostly dream about the money in their bank account when that car is sold.
When friends visit my warehouse, I am always anxious to have them drive and enjoy our cars. In one case, an old friend (who I later realized is a dedicated flipper), spent about an hour driving our Carrera RS on a long errand. He was so overwhelmed that anyone would do that, he became convinced I wanted to sell the car, although that was the furthest thing from my mind. He was actually insulted when I maintained that it wasn't for sale. He just could not imagine anyone driving an expensive vintage Porsche "just for fun."
Flippers announce prices to push market
Question six asks how carefully you follow the market. Porsche collectors often miss the latest twists and turns in the market, preferring to concentrate on the cars rather than just the dollars. Flippers jump on every latest move, and may even announce in their ads the latest sale price of a similar model, just to try and push a new and perhaps outlandish price as the "market value." Collectors know that no single sale, however highly publicized, makes the market. The market is always best represented by the sum of all transactions, not merely an outlier.
Seven: Porsche collectors love to be experts in what they do, and will attend shows and tech sessions and read any book published on their beloved marque. Flippers like to know enough to sell the merchandise, and will rarely delve deeply into the details to better understand the inner workings.
Eight: Flippers love buying and selling cars on eBay or Craigslist and visit the site frequently, maybe even obsessively. Ever notice the guy at your cousin's wedding endlessly scrolling through his Blackberry during the service? Probably a flipper. Collectors may look at the sites but don't generally buy much there, as the Porsches tend to be riskier and come with incomplete information.
Note that in many ways, these two groups, both of whom are obsessed with Porsches, are like oil and water and don't mix very well. Collectors tend to gather to share their enjoyment and knowledge of Porsches, while flippers are always looking to buy cars at very low prices from those who don't know much about the market, and sell at very high prices to others who don't know much the market.
In the end, these are two different ways to enjoy or profit from the old car hobby, each from their own distinctive perch. Stay tuned; next month I'll offer you ten tips on how to be a successful Porsche collector.