I would like to hear everyone's opinion on Model railroading as an investment of sorts....
Sure it's not like the stock market where $300 per month eventually turns into $400,000 in 40 years but I know my wife looks forward to the day where I get bored with it and I sell everything. I personally like rare items so they retain their value fairly well but who knows what they'll be worth in the long term. I like brass and have several brass items that have increased in value from what I see them going for on ebay. I've even got some plastic that is rare and increased in value from what I paid for it when I got it deeply discounted. A associate of mine recently liquidated his brass collection and made about $10k on top of what he paid for it. He did have a large volume of brass worth overall about $160k. Now obviously you'll probably lose money on scenery and benchwork, etc.
So overall, do you think the hobby is something that can somewhat sustain it's value or you lose a ton of value? Bad idea as a sort of savings or good idea? I mean I probably will never quit model railroading but the idea that a majority of the original money put in may come back out is possible. Do you think so?
A very,very,very very,very.................Baaaaaaad Idea. But that's just my opinion. Sorry, it is probably not what you wanted to hear.
Brent
"All of the world's problems are the result of the difference between how we think and how the world works."
johngriffey18ca1 A associate of mine recently liquidated his brass collection and made about $10k on top of what he paid for it. He did have a large volume of brass worth overall about $160k. Now obviously you'll probably lose money on scenery and benchwork, etc.
A associate of mine recently liquidated his brass collection and made about $10k on top of what he paid for it. He did have a large volume of brass worth overall about $160k. Now obviously you'll probably lose money on scenery and benchwork, etc.
Let's evaluate these numbers. $10k on $160k is a 6% profit. If he bought them a year or two ago, that's not horrible. Much earlier than that, I'm not seeing much of a return on investment. And that's assuming he didn't spend money on scenery and benchwork--a total loss.
And as much as there are some modelers willing to pay the big bucks, I hear a lot more on various forums complaining about high prices. Maybe I'd put my money into something where people didn't complain about the high prices--art?
Ed
johngriffey18ca1 So overall, do you think the hobby is something that can somewhat sustain it's value or you lose a ton of value? Bad idea as a sort of savings or good idea?
So overall, do you think the hobby is something that can somewhat sustain it's value or you lose a ton of value? Bad idea as a sort of savings or good idea?
For such a niche market, I would never bank on it. Generally, from a financial standpoint: With all the $$$ you invest into MRRing, you are going to end up losing money at it. Even the $10K profit on your associate's $160K brass collection only comes to ~6.25% gain over ??? years.
For me, I got into this hobby for its enjoyment and creativity; not for making $$$.
Tom
https://tstage9.wixsite.com/nyc-modeling
Time...It marches on...without ever turning around to see if anyone is even keeping in step.
Model railroading is a hobby and all hobbies are money pits. You can however invest in model trains and make money. But the two are not the same.
Johnnny_reb Once a word is spoken it can not be unspoken!
My Train Page My Photobucket Page My YouTube Channel
In the mid 70's - brass was a good investment. It is not any more. The 'plastic' brass has killed a lot of the brass market. A good example is OMI painted MILW bay window cabooses. 10 years ago they sold for $240-260 each. The Walthers model has forced the dumping of the OMI models, and I have seen them for anywhere from $125-150 each on eBay.
Some of the better known 'Crown' series have escalated from their original purchase price. I have seen most brass steamers go for about twice the original price. Now if you bought a PFM steamer for $100 in 1970, and it now sells for $200 - you had to wait 40+ years to double your money. That same $100 invested in 1970 will result in more that $200. Some brass engines have kept a high value and have risen - but not a lot. A good IRA will give you better returns. Buy your model trains for your enjoyment - not with the expectation of making a 'killing' some day!
Jim
Modeling BNSF and Milwaukee Road in SW Wisconsin
A hobby's "return on investment" is called: Increased Quality of Life!
This true of model railroading, camping, hunting, fishing, even true of golfing greens & caddy fees.
Conemaugh Road & Traction circa 1956
If one is thinking about this as a money making idea...bish on that idea....
Any argument carried far enough will end up in Semantics--Hartz's law of rhetoric Emerald. Leemer and Southern The route of the Sceptre Express Barry
I just started my blog site...more stuff to come...
http://modeltrainswithmusic.blogspot.ca/
tgindy A hobby's "return on investment" is called: Increased Quality of Life! This true of model railroading, camping, hunting, fishing, even true of golfing greens & caddy fees.
My thoughts exactly. I see the investment is in something that can not be measured in dollars and cents, but in my happiness. Or I am blowing all that money at the bar!
As noted above, there are ways to "invest" in the hobby, but that is a hobby unto itself.
Very, very bad idea.
If you get in this hobby (or any other for that matter) thinking of it as an investment and a way to increase your wealth then you're a fool.
period.....
Don't ever buy anything MRR related thinking you're going to make money from what you buy. Just ain't gonna happen.
You'd be better spending your money playing the lottery.
There are at least two undeniable truth's about any investment.
1. The success of any investment must be measured against alternative investments and
2. The value of any investment frequently rises and falls compared to others.
Housing was a pretty good investment until about 2001, then it became a real good investment until about 2007. You know the rest....
Tech stocks were great from about 1990 to March 2001...then again from about 2003 to about September 2008....
Judging by some of the price increases in model products, I'm not sure if we are in a price bubble or if this is a good time to invest, if you're so inclined. If manufacturers start moving production to Vietnam, like Walmart is with some of their goods, I tend to vote that we are in a bubble.
At any rate, bench work and scenery material is just garbage. I can only see possibly locomotives and possibly structures being good investments over time.
Of course, if a person enjoys collecting and building in the first place, then measuring a return on the investment when you sell the items will vary from person to person.
- Douglas
Well said!
As far as monetary value is concerned, I have a nice set of ticket stubs and Olympic programs, collected when I went to Atlanta to watch the Magnificent Seven win the gold medal. To my estate, those are probably going to be worth at least as much as my entire motley collection of well-used brass, cheap RTR and unlikely kitbashes. Layout value? More likely, somebody will have to pay for the use of a dumpster to dispose of it.
Chuck (Modeling Central Japan in September, 1964 - for fun, not as an investment)
Nope. As others have said, the investment is in the quality of life this hobby can provide.
Wayne
Modeling HO Freelance Logging Railroad.
I have never seen anybody who was able to present figures showing that investing in toy/model trains was a good overall, long term investment. Sure some items and a couple of short (2-3yr) time periods have shown a decent return. Problem is: which items and/or time periods to pick.
Collectibles are a fickle market. Look at collectible plates. My mother in law collected these for years, but except for 2 or 3, they all went down in value - most to zero. The couple that went up weren't enough to break even overall
If you do decide to invest, Lionel is probably your best bet, followed by American Flyer, and some other O gauge toy trains. Brass would be next . After that it's really up in the air as there is no established collectors market. Lionel and American Flyer price guides are published each year. A Brass book is published periodically. There are people collecting some unbuilt collectible kits such as from FSM.
Keep in mind that NIB (New In Box) and Mint Condition are best. After that, the value falls quickly.
If you do invest:
store them in a climate controlled environment
don't run them
don't build kits - don't even cut the parts off the sprues or punch them out.
don't paint them
don't add parts - even Kadee couplers
if the box is factory sealed don't break the seals
keep the original boxes, instructions, and packing materials
note that there are issues with foam so make sure the foam inserts are not in contact with the model, but do not dispose of or replace the foam
if you must handle them wear gloves such as museum conservators wear.
don't forget to insure them as your homeowners policy may not cover them.
AND FOR PETE"S SAKE DON"T HAVE ANY FUN WITH THEM.
With luck, selling them yourself, and enough inflation you should be able to recoup your original cost.
Personally I don't care if mine lose value or not. My heirs can keep what they want and sell or donate the rest. If some lucky model railroader gets a great deal and treasures them - I'm happy for him.
Enjoy
Paul
Two axioms about the MR hobby:
1) If you want to make a small fortune in the MR hobby, start with a large one.:
2) A train layout is a hole in the basement into which money is sunk.
(But have a good time in the process!)
johngriffey18ca1 I would like to hear everyone's opinion on Model railroading as an investment of sorts.... Sure it's not like the stock market where $300 per month eventually turns into $400,000 in 40 years but I know my wife looks forward to the day where I get bored with it and I sell everything. I personally like rare items so they retain their value fairly well but who knows what they'll be worth in the long term. I like brass and have several brass items that have increased in value from what I see them going for on ebay. I've even got some plastic that is rare and increased in value from what I paid for it when I got it deeply discounted. A associate of mine recently liquidated his brass collection and made about $10k on top of what he paid for it. He did have a large volume of brass worth overall about $160k. Now obviously you'll probably lose money on scenery and benchwork, etc. So overall, do you think the hobby is something that can somewhat sustain it's value or you lose a ton of value? Bad idea as a sort of savings or good idea? I mean I probably will never quit model railroading but the idea that a majority of the original money put in may come back out is possible. Do you think so?
Several guys in our group have helped sell the collections of group members who have passed away. Based on my casual observation of their efforts, and my own purchases from these estates, if a total return of 50% was achieved, that was good.
And that does not allow for the change in the value of the dollar over all the years of buying this stuff. Pay for it in 1969 dollars, 1985 dollars, 1998 dollars and get a 50% return in 2011 or later dollars - that likely averages out to 25%.
Looks like a bad investment to me. I consider every dollar I spend on trains the same as spending money to eat out, go to a show, take a vacation - it is entertainment - gone.
Now if I go first, and the wife gets a few dollars back selling of my toys, OK, good for her. But I don't see my next locomotive purchase as an excuss not to make the maximum contribution to my IRA this year.
Not one "consumer product" I have ever bought has really been a savings account - but some have been very good values providing things I needed or wanted at a very reasonable cost. The real cost being how hard I had to work to get the benifits of each product.
Model trains are only an investment in fun.
Sheldon
Investment?
Yeah,right..
More then likely a investment to the poor house.
While there are some older brass steam locomotives from the 50/60s that will fetch a nice return on their original cost however, most HO locomotives will fetch a small return on their MSRP on the use market unless the engine or car is extremely rare and hard to find..
Larry
Conductor.
Summerset Ry.
"Stay Alert, Don't get hurt Safety First!"
-------------------------
There is one strange locomotive that went from $39.95 in early 60s to over $500.00 today and its still a sought after locomotive..
That locomotive is the United Models 2 truck Shay-not sure on the going price of the three truck verison but,suspect its not cheap..
Ok, I'm not a golfer and don't want to offend any of you out there who enjoy this game. I have always compared my hobby with golf when justifying purchases to my wife---who does encourage me with Model Railroading. Golfers have shoes, clubs, and a whole bunch of receipts for green fees and travel expenses. At the end of the day I still have receipts but also have something I can put in my hand and look at, whether it be a box car or locomotive, items which can be enjoyed and used for years. I don't care if they depreciate or appreciate in value over time because they have value to me day in and day out.
I've enjoyed this hobby for over 50 years and have never made a purchase based upon the potential for price gain down the road. My purchases are items I would like to have today and have never considered any model railroad acquisition as a financial investment.
When I sold off much of my N-scale collection on eBay the return on investment had been terrible to say the least, I figured I got back at best 40% what I put into it, however the money did help me defray the costs of my project racing bike at the time which had been the point. I've never bought trains thinking I'd make money on them one day, though I like the idea and will at least work to keep my models in as good a condition as possible, however my trains will likely only be collectibles if there is a solid economy and if I'm a famous dead person and my family is auctioning off my collection.
Model trains, to quote my former hobby store boss have no resale value as a whole. Brass does maintain resale value for the most part, with exceptions noted, and you have some craftsman kits which will continue to escalate in value, such as those by FSM and SRM.
Alvie
A hobby?
Many hobbies don't have a return on investment, most loose.
That is because a hobby is a highly personalized thing.
Brass may well have grown in value, but I guarantee ya my scenery on extruded foam base and my Bachmann DCC OnBoard locos won't bring back much.
Even coin collecting is a fickle business. For every story of a coin or stamp fetching some astronomical price at auction there are probaly 1,500,000 collectors who will loose money, if not more. Even "gold collectable coins" are rarely made of pure gold, only gold clad.
Art is too.
so DOn't look to your hobby to be a gainer in value.
-G .
Just my thoughts, ideas, opinions and experiences. Others may vary.
HO and N Scale.
After long and careful thought, they have convinced me. I have come to the conclusion that they are right. The aliens did it.
johngriffey18ca1 I would like to hear everyone's opinion on Model railroading as an investment of sorts....
I think a Model Railroad is an excellent investment!
In my relationship with my kids, something to do that I enjoy, a relaxing pastime, as something that will help me learn new skills and improve old ones, and something that helps me make new friends with people who have similar interests.
As for the money.... (shrug), you only live once.
John
I'm with Sheldon and Wayne, I view my model railroading purchases as consumables. I expect to never see any monitary return on them. I have enjoyed purchasing, running, building, showing off or whatever I did with them. Any money returned at some future date is just a small, unexpected bonus. I get a lot more hours of enjoyment out of it than a DVD which I can watch how many times?
Gary B
Fox River Valley Railroad
......don't take this personally but you're nuts. If you wanted to make money in a hobby you should have started a coin collecting "hobby" of collecting 99.99% pure gold coins in September 2008.
The St. Francis Consolidated Railroad of the Colorado Rockies
Denver, Colorado
As hobbies go MRR is probably a better investment of resources than most other mainstream hobbies. You buy a train, enjoy 20 years or more of running it and you got your money worths out of it. . Spend $1000 on an R/C plane and it crashes the first flight out, you are out all that time and money into the plane (maybe you are lucky and can salvage the radio and a few servos). I have been MRR about 2 years now and if I had to sell off everthing tomorrow at 10% of what I paid, I think I would still be ok because I enjoyed all the hours spent MRRing. If you think at some time down the road you will sell your trains, I woud recommend not buying junk now If you want the best return on your investement, just keep your money but what fun would that be.
St. Francis:
Very true and it also applies to silver coinage. It wasn't that long ago when silver was going for about $8/ounce and it is now over $35, and at times approaches $40/ounce. Collecting truly rare coins or scarce coins, is generally a sound investment over the long haul---it is generally easy to find a buyer willing to pay a premium for good quality rare coins.
A problem with model railroad stuff as "collectibles" is you never really know what's going to be desired 20-30 years from now and what will just be considered "run of the mill". Even with Lionel, for every truly collectible item you've got a hundred "good not great" engines, cars, accessories etc.
I suspect when I die the only thing that will show a good return on investment will be my hardcover railroad books...assuming I die soon enough that people still read actual hardcopy books and not just stuff from a screen of course. I know some of my books bought in the 1980's have doubled or tripled in value over the years.
wjstix A problem with model railroad stuff as "collectibles" is you never really know what's going to be desired 20-30 years from now and what will just be considered "run of the mill". Even with Lionel, for every truly collectible item you've got a hundred "good not great" engines, cars, accessories etc. I suspect when I die the only thing that will show a good return on investment will be my hardcover railroad books...assuming I die soon enough that people still read actual hardcopy books and not just stuff from a screen of course. I know some of my books bought in the 1980's have doubled or tripled in value over the years.
In 54 years on this earth I have NEVER, and will NEVER buy something because "other people" like it or desire it. But then again I am known to follow my own drummer on a number of topics.
I've never bought a model train because it might be valuable later, I've never bought an automobile based on its projected trade in value, and I've never bought any "object of art" as an investment.
I'm far too self involved and too far too particular about my posessions to allow such things to influence my purchases. I buy trains based on filling the modeling goals of the layout, I buy automobiles based on their utility and value, and I buy decorative art strictly based on its style and appearence for the decorating task at hand. Art too is like model trains, to be used up like food anf drink.
But, since I don't get "bored" with stuff quickly, this approach has served me well.
Well...if one wanted to supposedly 'invest' $$$ in something then why not stocks? Can make a 'hobby' out of that....
Or..just as piculous here...why not 'analogue' synthesizers from the 1960's/1970's? An Arp2600 no a days can set you back about $8,000 or you can always find a Buchla for around $10,000 now...