Gun Investment Question

[RobbRus]

Hello all,

If I were to take $10K to $20K worth of money and invest in one to several guns to purchase for holding onto for five to ten years and watch their value grow, what makes and models would you all recommend for the highest value increase?

I'm thinking a Dragunov or one of its variants would be a good start (would take most of the cash I have though). I've also thought about maybe some Milsurps that will have increasingly rising prices (Swiss K31, K98k etc).

Any suggestions whether long guns or hand guns are appreciated.

Cheers

[Snoopy47]

Like any collectable you need to know the future, and not all collectables hold their values consistently over time. A lot is based on popularity which might be tied to pop culture at the time.

Presuming one picks the best choice of investment, firearms transaction costs along with pedigree validation can be quite expensive.

I had an 1800's pistol a few years ago I tried to sell, and I couldn't get anyone to give me $750 for it (my bottom price). I ended up sending it to an auction house and got $2500 for it.

WOW you might say, and yes, I did much better than $750, but I was NEVER going to be able to sell it myself for $2500 because the auction house vouched for it's legitimacy. I was never going to find my target market willing to pay $2K+ for it either.

So if the buyer bought it for an investment himself he's going to pay bidding fees on is side, and then potentially be in the same boat I was if he ever decides to sell it. Of he were to make say 30-40% return on his auction bid he'd be lucky to break even a the end of the day.

Then if one considers the Return on Investment relative to an alternative use of funds in something like a mutual fund and the ease at which that can be liquidated and the relative small cost to takes to do that the two investment choices become obvious.

******
I wouldn't invest in guns for the expectation of a responsible return on investment.

I can see buying them for the sake of having cool things to show off, or to use and enjoy.

[Oldmandan]

Most gun people are cheap, they want -$500 guns

Try selling a $2000 gun in the marketplace, you’ll get all sorts of crazy trade offers, and no serious cash offers

You’re better off putting that money in a +5% CD right now

If you’re dead set on doing this, then I think you need to look at guns that are highly collectible so you can actually sell it later. Old colts maybe?

[jayhuh]

If I had that kind of coin, I?d speak with an investment professional. Screw guns. I?ve lost money on every gun I've bought since the mid 70?s. But at the same time I?ve never bought to make money. I?ve shot the stuff out of them, tired of them and flipped em.

Edited to add, no one has any idea what the political situation will be in 5-10 years. A stolen election in 2024, and a death/retirement of a Supreme Court justice or two, and all of a sudden you might not be able to flip those rifles, and at the extreme, might face confiscation.

[BigMac90660]

Genuine Colt SAA.

[SVT-40]

How are you going to determine that the rifles you buy are worth the investment?

Faking K98K types has become a big problem. As values increase so do the amount of fakes.

Before you spend a dime on a rifle do your homework. Buy the books related to that particular type.

Only after you educate yourself should you start looking.

Buy the best condition, original all matching un restored rifles you can find. Yes you will pay more, but those will appreciate more than lesser condition examples.

[JC2020]

Even if you just stuck $10,000 in a wealthfront cash account at 5% APY for 10 years, you would end up with about $16,289. So you would make almost 63% on your money, parked and liquid. And no fees.

Will you make that on a gun investment? No idea.

But that 5% is awfully nice if you need it to stay liquid and accessible.

[mdr110]

Invest in guns takes knowledge. From desirable, limited production, trends, collectibility, history and so on. Some protect those knowledge as trade secret. However if you gain those knowledge you'll do alright. Like investing in stocks you have to pay someone if you don't have the knowledge.

One gun investing strategy I'll share is find the cheapest 10 Glocks, 10 lowers and 10 LPK you can find, wait for the next pandemic or George Floyd type civil unrest and rake in. You'll guaranty double or triple. If nothing happened in your example timeline and sold off those Glocks, you won't get taken to the cleaner that bad.

But all in all invest in guns require lots and lots of homework.

[ar15barrels]

If I were to take $10K to $20K worth of money and invest in one to several guns to purchase for holding onto for five to ten years and watch their value grow, what makes and models would you all recommend for the highest value increase?

The fact that you do not already know the answer means you should not be playing that game.

If you want a Dragunov, just get one.
Prices are still currently falling on guns so it might not be the time to buy just yet.

[highpower]

I have done okay on my firearms purchases because I buy old classic guns that have a following. If you buy new, current production guns, like Wilson Combat's or Staccato's that are currently in production, you will lose money if you try to sell them.

There are a few exceptions like early Gen1 Glocks (which is definitely a niche market) where I have done fairly well. I never buy a gun purely as an investment, I buy guns that interest me and if they go up in value, great, if they go nowhere, that is okay too as I seldom sell any.

As Skyhawk stated, you must do your homework. Quite honestly asking random people on the internet is not necessarily the best way to do that. Buy the books before you buy the guns. Always buy the gun, not the story unless it has documented provenance. Check Gunbroker completed auctions to see what the average selling price is for what you are interested in. The more expensive a item is, the more fakes are going to be out there.

If you buy high condition prewar Colt 1911's and hang on to them for several years you will likely beat the general rate of inflation. The same is true for military arms and other firearms with good track records. If you buy low end of the market guns, you will always be chasing the bottom feeders. Discriminating collectors with money, want the good stuff and will pay for it.

So far the highest rate of increase is probably in the transferable full auto market.

If all you are looking for is to increase your wealth, stick with the stock market and real estate. I don't invest in stocks, but I have done very well with real estate.

[Prepped and ready]

Theres a lot Ive learned with regards to gun value and waiting it out for investment and profit.

Not all 1911's area worth more then what you pay. I did really well with the sale of my Cabot 1911's a few custom Colts, Ed Brown Comp, Wilson Combat and a few other brands. The thing about those guns, was they were all custom 1 of 10 made. That made them valuable to other 1911 collectors.

Older Pytthons pull a good price as well as several other older handguns.

As mentioned, investing in guns takes knowledge and also time. Sometimes you can get lucky and other times you dont, but may want to take a chance and sit on an item for several years.

Unless something really rare comes along, I wont put any money on guns. Id rater put my money in older cars knowing the value on those only goes up in time. Hell, I have a few Hot Wheels that are worth more then most high end 1911's.

[benjamin101677]

My experience in being around a gun shop almost daily is that I don?t think investing in guns is a smart idea. I have in the last few years seen so many older folks that have really nice gun collection and need to sell them either not be able to sell them or not get a profit for them. It is really hit or miss in what guns have remained popular and command a premium.

If you buy 20 thousand worth of guns which isn?t a huge collection and then something happens in your life and you need cash asap it is going be hard to get that money out of them quickly.

I would recommend gold or silver. 20 grand worth of gold is not a huge amount and would be easy to hide. Yet; if something were to happen and you need to get cash asap you could walk into to many shops and walk out with your cash same day

[russ69]

A stolen election in 2024, and a death/retirement of a Supreme Court justice or two, and all of a sudden you might not be able to flip those rifles, and at the extreme, might face confiscation.

When the first AW legislation was passed, I was sitting on a good number of AWs that were on the list. At that point, they soon could not be sold in California or transferred to my survivors. So I sold them all for twice what I paid rather than chance a total loss.
I think the possibility of firearm bans, restrictions, licensing, etc, just make it too risky to guess future markets. Things can literally change overnight. Not worth it.

[IVC]

One more vote for the "not a good idea." Guns are in many ways commodities and you're more likely than not to lose money because the ones you buy can be bought by everyone else, so it comes down to whether you can end up with something very special that is not-so-special right now.

It's like buying 20K worth of beanie babies and hoping that one or two of them turn into profit makers.

[OlderThanDirt]

Beltfed firearms have appreciated in value quite a bit over the past 5-10 years.