Monday, May 3, 2010
Why I sold my Tractor...
I am selling my antique tractor on eBay and the wonderful thing about eBay is that in about 7 days, whatever you put on there is sold, no bones about it, if it is priced attractively. If not, lower the price and re-list it for another 7 days. It will sell, eventually.
Why sell it? Well, for starters, we decided to get off the Great American Lawn merry-go-round and let our five-acre field go back to being a field. The cost savings in fuel alone will be well over $100 a year, perhaps double that. And the time saved will be dozens of hours.
So the reason I bought the tractor no longer exists. I bought it to mow the lawn and we no longer are mowing the lawn. When you own a piece of equipment and no longer use it, sell it, before it degrades from lack of use. And sell it, when it is in prime condition and you can get the most money for it.
Now some folks have told me, "Gee you can't sell your tractor, that's a classic!" Well, that sort of thinking leads people to hang onto things longer than they should. Defining yourself by what you own is never a very smart idea. If you think of yourself as "Mr. Harley" or "Mr. BMW" or "Mr. Bayliner" or "Mr. Jeep" or "Mr. Tractor" it is, to begin with, a very shallow existence. Owning a piece of equipment is fun, for about 15 minutes. Using it may be fun for a few years. But one should never let any piece of machinery own them.
You hear this all the time in car and motorcycle forums. "I'll never sell my Harley" a 30-something says, "Live to Ride, Ride to Live!" they cry. But like anything else done repetitively over the years, it eventually loses its allure. And you see old Harleys languishing in a barn or garage, because the owner can't bear to part with them.
And I am not picking on Harleys - fill in the blank with any other consumer good you want to name. People think these things will last forever (they don't) that they are worth a lot of money (they aren't) and that they are worth hanging onto.
I recently saw this in a BMW forum. A young fellow was convinced his decade-old BMW was a "collectible classic". Maybe in 30 years it will be. But today it is just another used car, depreciating annually. He will sell it, eventually, not to a collector, but to some chump who will drive the wheels off it and junk it. Most cars end up this way, even "collectible classics". And that's why the old collectible classics are worth a lot of money - because so few of them survived.
And as I have noted time and time again, it is never a worthwhile financial proposition to try to keep a new car until it is collectible. In your lifetime, a car will not likely appreciate in value enough to pay back the purchase price. And the cost of ownership over the years will insure that it will be a negative investment.
Classic cars are worth tons of money mostly because it took tons of money to restore them to the Concours condition that commands high prices. No one is going to pay collector prices for your daily ride or a 15-year old used car.
Collector cars are rarely driven, but are more talismans than actual cars. So in order to be collectible a car, tractor, Harley, or whatever has to be never driven (a survivor) or restored to pristine condition and then rarely used.
For most of us, this is not the case - we merely own used cars, bikes, or whatever.
So forget about the idea of "saving" a piece of machinery as an investment, because as investments go, it is rarely a good one.
And while we may think of our particular vehicle as "rare" and collectible, chances are, it really isn't. Many items that are rare are still not collectible, if there is not a demand for them. For example, these Ford tractors are fun to own, but they are not very expensive to buy. Ford made a lot of them, and a lot of them survived. They basically never wear out, so you can find them all day long in sheds and barns. Parts are cheap and they are easy to restore. So prices for these tractors, even after 70 years (!!!!) languish in the $3000 to $5000 range. Even a "pristine" restoration would be lucky to break the $10,000 barrier. There are just too many of them out there to make them expensive.
BMWs suffer from the same problem. Like any mass-produced car, there are just too many out there. Even the iconic 2002 might be lucky to break $10,000 on a good day, for a well-restored example. The problem is, while we all might have fond memories of such cars, the reality of them is something else. Time has marched on, and these tiny, buzzy cars are not exactly safety machines. A pristine restoration cannot be driven. Anything less than a pristine restoration is a PITA to drive. Newer cars are better and better made, so most people opt for newer iron. While it is fun to LOOK at an older car, most of us really don't want to own one, from a practical perspective.
So the idea of hanging onto a piece of machinery as an "investment" is foolish. Use it for its intended purpose, maintain it, enjoy it, and when the time comes you are no longer using it, sell it and use the money for some other purpose.