MGC – What’s it Worth?

So what’s it worth? This is a question often asked by owners, and potential owners, about their MG because they are looking to buy, sell or agree a value with their insurance company.

The saying of ‘it is worth what someone is prepared to pay for it’ rings very true but to reach that point of value first takes some background research and the appreciation of how a value is arrived at.

Immaculate MGC

Buying

Clearly when buying your chosen MG you want to find the best car for the least money. An easy formula but it is what all potential purchasers are looking for. Everyone has a budget and you must look both above and below this figure in your search.

The more cars you view the better you will be at choosing the car that represents best value for money. It is very much a buyer beware market and you need to read as much information as possible about your chosen MG via the appropriate Buyers Guide.

Care must be taken not to buy a car that is overpriced for its condition and this is where the more you see the better you are to judge the perceived value. Look at the cars that are priced around your budget both private and dealer and this will start to define the car you will expect for the money.

Selling

The key in the market place is to be honest to yourself about the car, look at similar specification cars and price accordingly to current prices. There is no point in advertising your car for £1000 more than another similar example, as most buyers will look to the cheaper option first. You need to be cheaper and better than the competition and give as much relevant information about the car in the space constraints of the advert that you have. Providing you have the wording and price right you will find the telephone will ring with enquiries. Once again, giving an honest description of the car will stop any time wasting from either party involved and should result in the car selling itself.

Good interior is important for valuation but structure and mechanics come first

Original and correct MGC engine bay enhances value

Neglected engine bay on this MGC will detract from value

Insurance Valuation

This is often the area that causes most concern and agitation regarding the value that an insurance company places on MGs. Many owners are very accurate in the way in which they assess their vehicle, having looked at similar cars for sale in the market place. However, there are others that tend to overvalue the vehicle.

It is true that sometimes a buyer will get a very good vehicle at a bargain price, but under most conditions a newly acquired vehicle’s value will be that of the purchase price. Traders are not known to give money away, so insuring a vehicle with an agreed value of several thousand pounds above the purchase price will normally be met with a reduction of the suggested value.

Money spent on restoration or maintenance is very difficult to quantify as to how much it actually adds to the vehicle’s value. Often maintenance costs, such as a brake overhaul, servicing or suspension overhauls allow a value to be maintained rather than increased. However, while upgrading components at the same time or replacing larger items, such as the engine or gearbox will add some value, it will increase the car’s value the total amount spent. As a guide you will often see between 35 – 45% of overall cost added to the value.

When it come to restoration costs, much higher amounts are involved but, again, the total cost is not added to the value. Insurance companies will not take in to account the labour content and the overall value will be guided by the sales market. A fully restored MGB may cost in the region of £23,000 – £25,000 to restore but is likely to be assigned a value in the region of £18,000. This is mainly due to market forces dictating top prices paid. In the second and third years after restoration the price will still drop further until, if kept in excellent condition, the value is likely to plateau out at, currently, around £13,500.

Of course there will always be exceptions to values where a car is extremely rare, has a given providence or is a historically important car such as an ex-works MGB. Individually customised vehicles also give a slight challenge in value and in such circumstances each individual vehicle is assessed on its own merits.

The question of what it’s worth is therefore dictated by both the market and individuals who may be prepared to pay well over market prices for a car that suits exactly what they are looking for.