Maximising the ROI on luxury cars
New analysis of the online car market reveals the best cities to buy, sell and turn a profit on luxury car brands like Porsche, Jaguar and Mercedes-Benz.
Following the study of over 25,000 online car listings in London and the UK’s 10 largest cities, a recent report from private number plate supplier Regtransfers revealed Glasgow as the overall “leader” and best UK city to buy a luxury car – offering the best combination of price, mileage and age.
Since the initial release of information, further research has been conducted to uncover the best locations to buy and sell different luxury cars, with a view to turning a profit.
More widely known as “flipping” cars, this is a common practice among car enthusiasts and money-makers, providing a solid and consistent means of gaining profit for those with a sharp eye for deals and the drive to put the time and effort into it.
With initial research covering a 20-mile radius of each city, the resulting data shows the average prices for the nation’s most popular car models in each region, as well as the availability of each model based on the number of local listings across each city. It also reveals the stability – or opposing volatility – of regional markets for different models in the second-hand space.
Scoring each city based on these factors presents a detailed chart of the best locations to buy and sell the most popular models of luxury car brands. For buying, a lower price and higher “supply” of cars increased the score. For selling, a higher price and a lower number of cars – indicating higher demand – increased the score.
Luxury Cars With High Potential
The Mercedes-Benz S Class offers the greatest margin for profit, with a potential ROI of up to 133%. The initial average cost of £36,033 in Bristol offers an affordable starting point, while Edinburgh’s average sale price of £83,942 for the same model shows an average profit potential in the region of £47,000 – making it the leading model to invest in.
A Dodge Challenger bought in London at an average £58,313 holds a profit potential of around £71,678, when sold in Manchester for an average £129,991 – the second highest increase overall at 123%.
Luxury Cars With Mid-Range Potential
At the mid-range of potential profit – that is, models with around 25-50% return on investment – popular models such as the Jaguar F-Pace, Porsche 911 and Aston Martin Vantage can all be bought and sold across the country for fair return. The Jaguar F-Pace stands out in this list as the most affordable, with an average buying price of £28,000 in Birmingham, and an impressive sell price of £34,000 in Glasgow – a 25% increase on initial spending.
Luxury Cars With Low Potential
At the lower end of the scale, models such as the Audi RS3, Range Rover Evoque and McLaren GT all offer minimal returns, with under 25% increase on initial investment. The Tesla Model 3 and Polestar 2 both appear In this “bottom league”, though this will be due to a more stable market, given that the cars are newer additions to the road. Finally, the lowest ROI was found in the Genesis G70, which garnered just a 2% increase when bought in Leicester and sold in London.
Regtransfers CEO Mark Trimbee expresses keen interest in how data such as this may aid keen, entrepreneurial spirits in finding great opportunities to make money.
“The potential profits on display in this data are nothing short of tantalising to those with the funds to invest – and there’s ample opportunity to grow an initial investment. Looking at this data, I’m reminded of Kyle MacDonald, who used Craigslist to “trade up” from a paperclip to a farmhouse in the space of just one year. With some careful considerations, this data suggests one might be able to do the same in the luxury car space.
Of course, it’s important to recognise that these numbers should not be taken as gospel. This data has been generated based on averages, but each opportunity to buy and sell will be unique, and the market, local prices and availability of luxury cars will fluctuate with time, as it always has done. It’s always advisable to buy with care and sell with honesty to avoid disappointment.”
