I was wondering, like everyone else. When the stock market takes a hit like it has the last few weeks. Is it time to buy model trains or sell? Maybe just trade for what you may like better for a future investment.
AZ-Flyer
when is it not a good time to buy mrr equiptment? if you are under 40 and employed you have nothin to worry or complain about . the rest of us have much in common with our Depression-era grandsires.
As the cost of petrochemicals rises the costs in the hobby will. what a responsible hobbist needs to do is relearn many of the mechanical skills that can be used to scratchbuild a hopperbottom gon as an example. MR has a responsibility to reprint many of the Scratchbuilders Corner series or a new series about $5 model.
to return to the OP question, if i had the money in stocks, i would get out and invest in brass.
I don´t know whether investing into consumer products, hoping that they appreciate over a time span, is a wise thing to do.
What are we talking about? Even a highly detailed, nicely executed and expensive brass loco is basically just a toy, and the toy market is flooded with so-called collectibles. If you check the listings of businesses selling brass locos, they are loaded. A loco, which was marketed at 60 - 80 $ some 40 years ago, now sell for, say, 300 $. If you deduct the dealer margin from it, there is only little increase in value - a regular savings account would have given you more.
There are only very few exemptions from this. Pre-war large scale tin plate models in mint condition may be one of them. A Marklin gauge 1 Swiss “Crocodile” from the early 1930 sells for the price of a luxury car, but it is really a rare bird, as most of them were lost during the war.
I also had to make the experience that, if you have to sell, you are going to make a loss, not a gain.
Collecting brass is a good thing - for the joy of owning them, not to sell them.
Just my [2c].
While there are some models that has a hefty collectors price the majority devaluates at a alarming rate simply because they are used the minute you try to resell them.
I agree with Brakie. Investing in model railroad is usually a bad investment. There are certain items that do command a higher price if you go to sell them but they are far and few between. Your better off paying down as much as you can on your mortgage then you are playing the stockmarket.
Just like the stock market, there are values to be found, and there are overpriced items to be avoided. But when has that not been the case?
If the dollar falls relative to other currencies, particularly the Chinese yuan, then the cost of the raw materials used to make trains everywhere and the manufacturing cost in China will both go up, but that will take several months to hit our market prices. Many economists feel that the yuan is undervalued, but the Chinese have resisted calls to let it “float” and reach its natural level relative to other currencies. If that happens, expect train prices to go up.
When a sense of doom and gloom pervades the nation, go to a train show. If dealers are sitting behind their tables with lots of unsold merchandise, they may be willing to bargain on price to move some of it.
Or, you could use my 5-step plan: See it, want it, buy it, weather it, run it. Works for me.
Depression era? Speak for yourself. This may be tough to believe, but I’m 64. When my grandfather was 5 years old, the Civil War started. (He had nothing to do with it.)
Buying a product because of the stock market is not always a wise decision if you intend on making money. In the company (if offered) yes, their product, generally no. Through the years the stock prices may have increased for the company, but the worth of their product does not. That excluding any rare items, popular items, limited edition or just plain desirable to the buying public such as brass. However these items increase in value (or at least hopefully retain the value) independent of the stock market and have no real bearing on the worth of the company. Likewise for those products that lose value.
You are clearly in a different hobby than me. I BUILD model railroads, I do collect toy model trains. I have never bought or sold a model train from and investment point of view. In fact I have hardly ever sold a model train. The condition of the stock market has NOTHING to do with model trains.
I buy what I want, I am not ADD, so I do not get “bored” with the things I purchase. 40 years in the “building model trains” hobby, still have most everything I ever bought. And have no interest or regard for what its “resale” value might be. Its only value is the fun I have.
I think we need a “collectors” forum.
As for the economy, the stock market or the recent budget wows, none of these are approperiate topics for this forum.
But since everyone keeps bring it up, the recent fighting between the parties over the budget is about the same as two drunks arguing over a bar tab on the Titanic.
Sheldon
MMRing is a hobby, and except for hobbies like Art Collecting, Antique auto collecting, 99.99% pure gold collecting, Hobbies as a general rule are an expense NOT an investment.
Even with the recession from 2008, the prices of MRR stuff have skyroceketed in some cases.
The manufacturers are also offering “order now/ some cases Pay deposit now and we will produce the model”. Not enough orders, and they cancel the production.
I would say you should buy what you want IF you can easily afford it, and not look at it as an investmet {except maybe for brass MRR equipment.}
There are products at every price point for every modeler. The more expensive ones are turning out NOT to be a 'better quality" than the cheaper ones, but the more expensive may have more details.
Stick with what you can comfortably afford based on your monthly “hobby budget” that you will enjoy for years to come. If you can’t afford MMRing stuff now, then lay low til you can.
But don’t expect to buy now and make a killling later. Typical LOSS of a Mrring collection {ecept brass} is averaging around 20% of invested value cost according to those who sold out of their trains.
Remember you can’t eat a loco, but you can eat an apple. WHich are you gonna buy if your belt is tightening?
99.99 pure gold you can’t eat either, but if you bought in 2007 when it was around $600-$800/ounce, it is now worth over $1700.00 an ounce, and you would have easily about doubled your money.You can sell it though, to buy those apples. No one is gonna pay a dear price for your 2-8-0 consolidation {unless brass} just cuz you think you should have a profit off it.
There are at least a few threads along this line, if you search the community for them.
Places like Hawthorn Village and Hamilton Collection sell Ho scale and On30 model trains with themes for high rates on a monthly payment basis as an “investment”. Yet few people are interested in buying the whole thing or
One shouldn’t become a model railroader as an investment. While some models can be deemed “collectible”, few actually appreciate in value. Look at some of the more collectible items, antiques, art, antique and limited edition vehicles. Compare their current SELLING prices to the prices they commanded 5 years ago. With few exceptions prices are lower, sometimes much lower than before. Most people have less disposable income and more are selling their collections to pay bills. It is definitely a buyers market form most things.
My train buying is unrelated to the stock market. I buy trains based on my desires and amount of money I have to spend on a hobby - and have never sold any of them, I don’t expect any of my items to go up in value. Some kits from the 70’s have gone up in dollars, but when adjusted for inflation over the last 30-40 years they haven’t gone up in value.
If you are investing, then stock and bond funds are the easy way to go. Collectibles are pretty dicey especially things like trains.
Enjoy
Paul
I have to agree with Sheldon. What does the state of the stock market have to do with a hobbyist? The state of the stock market could affect business decisions for hobby manufacturers - but I don’t see any impact on the here and now of my personal finances and hobby participation. As long as I am employed and can provide adequately for the family, I will be participating in the hobby at some level.
Now, I’m more of a horse trader than Sheldon. I use stand-ins because I often can’t afford exactly what I want when I want it. Examples of stand-ins would be an FED 2-6-0 or various Roundhouse locomotive and car kits. Not quite the ultimate, but certainly good enough for the present (stand-in).
my thoughts, your choices
Fred W
BUY BUY BUY!!! not for an investment with the hope of monetary returns but as an investment in something to do that you enjoy and you can pass on to your kids.
Right on target [Y]
(this frightens me [swg])
Wow! I must rang everyones door bell on this thread.[:O] There was sure alot of great answers to Buy, Sell, or Trade when I got up this mornimg.[bow] I still have some money under the mattress for buying model trains when the price is right. I like restoring an scratchbuidrng. May I’ll get back to relearning my many mechanical skills that can be used in scratchbuidrng. I’m going to keep buying model trains based on my monthly “hobby budget” and keep working on my American Flyer train layout.[ip] With more time than money it’s the best way to go. I won’t be selling my trains any time soon.[:)]
AZ-Flyer
Someone, I wish I could remember who it was who responded to a similar thread back about 2005 or 2006, said when economics times are tough, hobbies have their best years. People fix more things, do without, and they purchase less, particularly big ticket items. He operated a hobby shop and found that when there was a recession, his shop became busy. People could afford the odd ‘feel good’ item, and it usually went into crafts and things that provided a return in happiness and fun.
If you don’t have the money, you shouldn’t be spending it. That’s a pretty general rule. But, virtually all N. Americans are into a bank or co-op for an average of about $50k these days. That’s an average. Many are well into the $200k range and beyond. Buying toys doesn’t sound to me like a wise use of any cash that doesn’t have to go into immediate necessities in those circumstances.
Crandell
Crandell, my LHS had a banner year last year with a ton of new people in the store. People weren’t travelling anymore and decided to spend more time at home. You can’t just sit around at home so you got to get a hobby. Slot cars, doll house stuff and of course anything train related were selling like hot cakes.
There is NEVER a BAD time to buy trains. But, sometimes are better than others such as when the wife is out of town![;)]
LOL! My wife father is taken her and the kids to cancun next year. She was worried I would be upset ! Of course I explained I was okay with it and that I thought they should go…etc.The whole time I am thinking about all of the time I will have to spend on my modeling ! Yahoo!