Gun value as an "investment", and selling them

[Caimlas]

I'd like to share my personal experience with buying guns as an investment. People on gun boards tend to be of the opinion that guns will only appreciate in value. This is likely true for many guns, but for most I'd argue it is not. After you consider the time investment taken to sell the gun, accessories, leftover ammo (provided you don't have other guns to shoot it), and everything else, I'd argue it's a substantial net-loss.

I am not saying "do not buy a gun as an investment" I'm saying it's probably not going to work out to your financial benefit. (Though, it might be worth it now to sell guns you bought years ago - they ARE going up in price. I'd still not think it's a good idea, personally.)

The first gun I bought was a USP in .40S&W. I bought it for $510. I didn't care for it and sold it a couple years later at a $100 or so loss.

I tried recently to sell my Tika T3 Hunter in .270 Winchester. This is a popular cartridge for around here, as many people own them. It's a good gun, shoots straight (quarter inch group @ 100 yards with "whatever" 130 and 150gr 'cheap' ammo), and is in almost-new condition (no rust or wear and only one small field mar on the finish. I got a good price for it 3 years ago - $480. New, they're going for $620 or so now. I got a couple offers, all less than I paid for it - and that was with the scope (granted, a $120 model) I had on it.

I've recently sold/traded two other guns for an 'upgrade' - a Yugoslavian SKS I bought when they were going for $89/ea and a Taurus PT111 Pro (stainless) which I got for $320 shortly after the stainless model was made available (about 4-5 years ago). I got $225 for the SKS (which was a win, but from $89, the price could only go up) and $240 for the Taurus. Both went towards a Mossberg 590a, and I came out exactly "even" after putting the 'leftover' $20 from those two guns towards some 12ga shells.

All told in three gun sales, I lost over 25% of my investment, twice, but got a 100% return once on a markedly less valuable gun. Maybe it'd have worked out better for me if I'd gotten a couple M1 Carbines back in the day, or some such thing, or a custom 1911 as a steal. And I'm sure some people do make a 'profit' off of gun sales. But are gun sales really any more than a "money sink" or holder? Seems to me their investment value, except with exotic or collectors items, is pretty much related to the cost of commodities and the current manufacturing cost of arms.

What say you?

 

[DRYHUMOR]

I look at it this way.

The loss on any gun from what was paid, is merely the cost of using it. No different from renting a gun at the range. Or paying for entertainment.

If the gun's use provided a hunt of a lifetime, a first deer, food, family bonding time, or teaching a new shooter, then the price was very cheap.

 

[scottaschultz]

In my experience, it takes a very long time for a firearm to go up in value... like decades.

I recently sold some of my late father-in-law's rifles and shotguns and they were all over 50 year old. They had been sitting in the display case for almost 30 years since he died. I am more of a handgunner and my wife decided the proceeds from the sale could be put to better use. Anyway, the only one that we really came out ahead on was a 1929 Savage 99K 30-30 that brought almost $2,500. Another was a Belgian 10ga double barrel shotgun that brought $800. He bought guns to shoot (which he did... a lot!) and now with the sale of his "collection", we have a nice new remodeled kitchen.

Unless you really know the market and are willing to wait, they generally make poor investments.

Scott

 

[Shung]

most of the gun i sold, I made a 40% profit or more on them... but sometimes it broke my heart

The profit was not because I fooled the buyer, but because I bought them at ridiculosly low price, sometime refinished them or so, and sold them back-

 

[DRYHUMOR]

I'm somewhere around break even, maybe a bit ahead for 30 years. I've got 5 right now I'll make money on if I sell, a few I'll lose on, and a few I'll break even on.

I seem to come out better in trading than buying, at times I have added what I paid for something as trade value, other times I end up a few hundred ahead.

 

[loop]

Buying guns as an investment is like buying stocks or bonds as an investment. You do it because you have a reasonable expectation of making a profit.

You do NOT do it because you like this gun and HOPE it goes up in value.

I bought a number of K98 Mausers at $80 each because I knew I could get $120 each for them. I ended up getting $200 each for all but two - one that I shoot and one that is 100 percent. I still have them.

I picked up a perfect CZ27 for a song because I recognized the serial number span and knew it was worth far more than they were asking. I made 1,000 percent profit immediately.

I spotted a Russian military Mak in a pawn shop for $95 and knew the going rate was $400 and toted it out the door.

Doubling, tripling or even getting 10 times your investment out of a gun is not unrealistic, but you have to be buying the gun as an investment and know what you are doing.

My carry gun is a terrible investment. I have at least $1,200 in it and would be lucky to get $700 for it. But, it is a carry gun - not an investment.

I have many rifles that I liked so I bought them. Some have doubled or tripled in value. A few are actually worth less than I paid.

Think of it like coin collecting - if you get lucky now and then you can make enough money to do something else. If you just buy what you like you'll be lucky to break even when it comes time to sell.

I do not care for, or even like, K98s, but I have an unfired, unissued one. I paid $80 for it. It may have been a good investment...

I saw a really good buy in a pawn shop yesterday. By Monday it will be worth four times as much and buyers will be standing in line.

An investor looks for profit on his investment. He does not hope that his investment is worth more to someone else because he, personally, likes it.

 

[JWF III]

IMO, most people selling personal guns they've bought are fooling themself when they think they made a profit. Once you figure in inflation, it's very hard to make any profit. Especially on a gun you bought 20-30 years ago.

Granted, there are exceptions to the general rule. If you'd bought AR lowers 2-3 years ago, and built them yourself. Then sold them 8-10 months ago, you'd have made a very nice profit. Same as the OP found out with the Yugo. An $89 SKS from a few years ago, then sold at post election inflated prices will net a tidy profit.

On the general firearm it is very hard to make enough profit, to call it an investment. (Don't tell my SO I said that. That's just one of my excuses for buying a gun.) It takes an extremely rare (or premium model), in extremely good condition, and bought at an extremely good price, to make a profit. Typically (except in those situations in previous paragraph), if you couldn't make a profit by selling it next week, you won't make a profit (after inflation's figured in) by selling it in 20 years. And if you shoot it, even rarely, you'll never make any money on it.

Wyman

 

[RatDrall]

If you bought 50 SKS's about 5 years ago when they were selling for under $100 and sold them recently for $600 each you would have made a profit.

Anyone who bought a Sig P6 for under $300 recently will make that back, and more, if they choose to sell it at any time in a year or two.

Anyone who buys a S&W Model 64 (or any K frame) security guard tradein for $220 will easily be able to sell it for more than that right now, or in a few years.

It all depends on the gun.

For whatever reason assault rifles are coming down now. I wonder if they will ever be this inexpensive again?

 

[Mr. Bojangles]

That's why I never sell any

 

[Balrog]

Guns are more fun to play with than stock certificates.

 

[Old Fuff]

Can you make money buying and selling collectable guns? You sure can, and sometimes beat the stock market - but you have to know what you're doing.

Those that advocate putting your money into stocks and bonds don't understand how to play the game. They presume that a potential gun investor will buy a new gun, hold it for a half-century, and then sell it for a modest or no profit - especially when inflation is factored in. They are probably right.

But the people that do make money don't do it that way. They look for an older gun that has substantially increased in value, but is - for whatever reason - being offered for a low price. I have found such "sleepers" in dealer's showcases or at auctions and in pawnshops where the seller has misidentified what they have, or what it's worth.

Because I take the time and make the effort to do some research I know what to look for, and recognize what I see, when I see it.

Once I have scored I can either keep the piece, or sell it for a quick and easy profit.

And at least at the moment, given the state of the economy, I can beat the stock market unless I'm a day player, and willing to take a lot of risk. The guns on the other hand represent very little risk if they can be bought at the right price.

One other thing. Unless the firearm is an antique – made during or before 1898 – hold it for at least one year before selling it, or sell it through an FFL or C&R license holder. Otherwise if you do much dealing you may find the ATF on your back, claiming you’re an “unlicensed dealer.” :banghead:

 

[Rembrandt]

...USP in .40S&W..bought for $510......Tika T3 Hunter - $480........Yugoslavian SKS $89.....Taurus PT111 Pro (stainless) $320.......Mossberg 590a.....

Don't take offense to this but you didn't exactly buy investment quality firearms. All mentioned are bottom tier working guns that are mass produced to meet a certain market segment.

Just like stocks or other investments buying quality will insure a better chance of a good return in the future. Time factor and market desires play a big role in what may be desirable in the future. Firearms as an investment should possess the following....high quality, classic timeless design, and low production numbers. If your gun has two or more of those items it will make money.

 

[fatelk]

They're a better investment than a new big-screen TV or a flashy set of wheels.

Back in the day, when we were all younger, my friends were all buying electronics, new cars, or alcohol. I was the frugal one who didn't make as much money, but put most of what I had into guns.

I could have been a lot smarter and invested in real estate or blue-chip stocks, but at least my money didn't end up down the drain.

Now if I'd really been smart, I would have invested in a college education. Then perhaps I wouldn't be out of work now and going back to school, with a family to support. Things get much tighter, and I'll be selling most of those guns I bought 15 or 20 years ago.

 

[gunnie]

..."And at least at the moment, given the state of the economy, I can beat the stock market unless I'm a day player, and willing to take a lot of risk. The guns on the other hand represent very little risk if they can be bought at the right price."...

the icing on the cake is, that if the market takes a complete dump, fire arms demand will sky rocket. in a fashion that would make the last wave of crazy demand levels seem like they were garage sale prices.

gunnie

 

[Mike OTDP]

Loop got it right. You will lose money on new guns. Used guns have potential, especially antiques. But you MUST know the guns and the market - and forecast which way the market will move.

 

[DFW1911]

My collection hasn't decreased in value, it's increased, especially in this economy.

I wish I could say the same for the rest of my investments

 

[theotherwaldo]

I don't buy guns to sell them, I buy guns to enjoy them.
I don't buy status-symbol guns.
I don't buy investment-quality guns.
That's boring.

I buy functional used guns that interest me. It's nice that they tend to maintain or slightly increase in value, but that's incidental.

I buy guns to have fun with them.

 

[Old Fuff]

I buy guns to have fun with them.

I have been known to do that...

But if ya' play the game you can make a little money...

After which you can buy more toys then you'd be able to do otherwise...

 

[doc2rn]

Guns are material possessions that will always be worth something until we get the new plasma rifles in the 40 Megawatt range.

 

[Quentin]

Most of the guns I bought years ago haven't appreciated that much. Got a Colt 1911 and S&W Model 19 for about $250 each in the '70s and today they're worth maybe twice that but most of that's eaten up by inflation.

The guns that have appreciated are old military guns, SKS, AK and two Lugers. The first Luger I got in about '75 for about $150 (shooter quality only) and now it's worth maybe $800. The other is a pristine 1941 byf with the "black widow" stocks and has skyrocketed from the $500 I paid for it 11 years ago to over $2000. (Nobody wanted black plastic grips on a Luger back then, now they go for a premium.)

Anyway, I DO NOT SELL MY GUNS!!!

 

[Phydeaux642]

I only look at new guns anymore if it is a carry gun. I fnally saw "the light" and started shopping for used guns a while back. It's a lot more fun because you never know what you may run across. I haven't been finding a lot lately, but that doesn't bother me. Last year I ran across some really good deals and could make some money if I wanted to sell them. Older used guns, if you know what to look for, make better sense to me as an investment. As they say, "they just don,t make 'em like they used to."

 

[lebowski]

Guns are a hobby for me, not an investment. I think a lot of people like to classify things as an "investment" so they can justify purchases. Like during the housing boom, spend $50k remodeling the kitchen and say "oh we didn't really spend $50k, that was an investment". Bull**** - you spent $50k, in return you got a nicer kitchen. If that's worth it to you great, but don't pretend it's an investment.

I realize many guns appreciate in value, but for me my gun hobby is certainly a money losing proposition. That's ok with me - I get enough enjoyment out of it that it's worth it.

 

[Sunray]

"...I lost over 25% of my investment..." Yep, you're right for commercial hunting rifles and handguns that are still available new. Neither are a short term investment. Doesn't matter how well it shoots or what accessories you add. They're used commercial firearms. Takes longer for them to retain value. Never mind increase in value. And you need to find a collector, if there are collectors, who wants it. The firearms you had weren't old or rare enough to increase in value.
Milsurps are a different thing. Takes much longer for them to increase in value now and they cost more, but over time they do increase in value by roughly 10% per annum. Some increase faster than others. Paid $175Cdn for my M1 Rifle and the same for my 1903A4(sans scope) in the late 70's/early 80's. Forget what I paid for my Plainfield Carbine, but it wasn't what it's worth now. Condition is everything too.
The really daft thing is that the assorted accessories(bayonets, etc) have gone up in value, percentage-wise, far more than the rifles.
In any case, your stuff was used readily available kit. That kind of stuff loses value, then, with enough time, retains its value.

 

[bootless]

This is my take on it. Shooting/hunting is a hobby of mine so I feel the money spent on guns and ammo is just for mere enjoyment. The nice thing about guns is that they do tend to sustain value fairly well, give or take a bit. Say your hobby is video games, trucks, whatever. Try and sell your old video games or $50,000 pick up 15 years down the road and see what you get. You'll have to give your computer/video games away and your awesome truck is now a "clunker." Guns values fluctuate but are still somewhat sustained, if you have to sell for whatever reason someday you're not gonna lose your a** on it.

 

[cyclopsshooter]

or you work in a gun store...

lets see, picked up a mint rossi 68 for $60
1991a1 for $250
bushmaster M4 $450
smith victory model (complete) $100

the list goes on