Ok… so this is not rocket science but I think this is a good way to approach determining the value of your car.
This might not be what the market will bare but it is the value. There are some hard numbers and some not so hard numbers, we’ll call those variables. (I’m computer programmer turned IT project manager, but still love the logic of math and coding.)
Always consider the original purchase of your car. What did you pay for it? That’s a hard number. Lets set the variable to “P” for purchase price. I’m an average guy with an average income, so you know I didn’t spend the gross national product of a small island country on my Mustang, plus it’s a coupe, so you get the picture. “Tell them the price!!”…”No..No…I won’t”….”Come on!!!”…”Ok fine!!!” So I paid $6,000 dollars for the Mustang with the straight 6 (250) engine and lots of girlie molding. “There you happy?”….”Yea but could have left the girlie part out”….”Whatever.” So you can see that depending on which price guide you use I over paid for the car right there.
Next you are going to have add the really scary hard number, the cost of restoration/modification. Yeah..I know..I don’t want to add them up either, but you have too. So keep a stiff upper lip, grab the grease smeared, finger print stained receipt folder (I keep mine in this small plastic box in the garage..don’t want in falling into the wrong hands…not that SWMBO [she who must be obeyed] wasn’t aware of the individual expenditures, it’s just the shock of see it all together, that can, I admit, stop the a heart beating for at least 30 seconds.) fire up that solar-powered calculator and have at it. We’ll label this variable “R”. As if that number might not be big enough toss in the maintenance if you drive it a lot.
Now the next variable is a soft number. It’s condition and determining it as subjective as picking the prettiest girl in the bar. You know which ones aren’t and then it becomes a matter of degrees for the others. (Any one offended? Any one?..Ok good!) Hemmings often displays a description in the front of most of their auction pieces that explain a useful rating of numbers with pluses and minuses. Example: 1+ or 2- like that. Once you can arrive at the condition we need to set that as a variable. We’ll label that one ‘C’ and it can be a negative or positive, in our equations. As you read this, you are going, yeah..but how much the condition worth? Here is my idea. Use at least two pricing guides and take the differences in value between the various condition levels, average it out and you end up with the average increase in value. Start out by calling your car average and the value as zero add the amount as the condition betters or subtract for every position it lowers.
You can include sentimental value and we’ll call that variable ‘Z’ and I can’t even being to tell you how to determine that number. Here is what I’d try. After adding up the hard numbers and then take the price you would honestly live with and subtrack the hard numbers and add the difference back in to the final value.
So to recap:
P = the purchase price
R = the restoration and or modifications costs
C = Condition
Z = Sentimental value.
Formula looks like this: P + R + C + Z = value.
Remember – this is a value – not what the market will hold. For insurance purposes you must drop the Z variable.
Ok…Tomorrow I’ll run the numbers for both of my cars and see how I fair.
Thanks for reading