What's Hot, What's Not: The 2016 Edition: Part I

January 22, 2016

Every year I like to take some time to comment on what collecting categories in my opinion are gaining traction within the overall trade and which are losing their appeal. One of the only constants within the greater antiques and collectibles marketplace is change. The year 2016 can easily be defined as the year of unknowns. Unfortunately, I can't tell you who the next president will be or how well the stock market will perform this year, but I can comment on overall trends I have been observing within the collectibles market. Kindly note that you are welcome to disagree with my commentary as these lists were compiled based solely on my observations and experiences.
I'll start with the proverbial bad news first, so we begin with a list of several collecting categories that are losing ground. Now more than ever, collectors have a magnitude of choices in which they choose to invest their hard earned dollars into. Gone are the days of double digit growth and so called “blue chip” collectibles. Speculation is running rampant. Younger collectors like myself want to be ahead of rising prices and demand. Unfortunately, this also means that a lot of well-established collecting categories are lingering at auction and in the overall marketplace. Here are my top five categories where both demand and prices are lingering.

5. Coins and Paper Money. Yes, you are welcome to disagree. Make no mistake the upper one percent of both of these markets are on fire. Coins in this area of the market routinely sell for six to seven figures or more, but who is buying those museum-quality pieces? The truth is even high-grade certified key coins and notes continue to lag at auction from the high prices seen before and even right after the 2008 recession. I have been buying and selling high-grade key coins and notes and cannot believe the prices that are being realized at auction. Forget buying these treasures from a high end dealer, as auctions are where you find your best deals. Auction prices are down across the board. Just check out completed actions from recent Heritage Auction sales for proof that demand is falling.

4. Cast Iron Antiques, Banks, and Toys. Older collectors fondly remember the incredible items made out of cast iron. From unique and exciting mechanical banks to traditional doorstops to incredible toys. Younger generations unfortunately view these items as obsolete, heavy, and even gaudy. Aside from the upper end of the market, cast iron antiques and collectibles continue to lag at auction after auction. Want proof? Check out overall completed auction prices of mechanical banks. Newer collectors just are not buying them and consider them a novelty not an investment.

3. Hot Wheels/Matchbox Cars. Before you criticize me and claim that I am truly out of it please look at overall price trends. Yes, classic near mint Hot Wheels Redlines from the 1960s and 70s are selling at a feverish pace, but at what price? Most of this category is down double digits from their earlier highs. The best time to be a collector of vintage and modern diecast cars was before eBay. Aside from some very rare Redlines being sold, record prices are no longer being paid and contemporary modern pieces are so mass produced a collector will never get their money back if choosing to collect. Use caution and study trends. The money is in the vintage offerings being sold at a discount.

2. PEZ Dispensers. It can be said that eBay single-handedly killed off all hope of a revival in this market, but there were problems in the overall PEZ marketplace long before eBay. PEZ lost all focus as a cheap collectible when the company ramped up production on most dispensers in the 1980s and worse yet, so many vintage PEZ were saved that the market is still oversaturated decades later. You can buy vintage dispensers from the late 1950s through 1970s at the same prices I was paying in the early 1990s. It isn't even worth it from an investment standpoint to buy and hold modern contemporary dispensers. Way too many are being made and hoarded. Unfortunately, PEZ is one area that has a much brighter future as a candy than a traditional collectible and I consider that a good thing even if all those dispensers I bought are going to have to be eventually sold in one massive lot, if they will even sell at all.

1. Pre-Nintendo Video Games and Systems. This last one is quite surprising, but during the early days of eBay certain truly rare and hard to find Atari and related video games were hit by a massive wave of speculation. Rare Atari 2600 video games like “Chase the Chuckwagon,” “The Texas Chainsaw Massacre,” and the elusive “Crazy Climber” were examples of uncommon games selling for low three figures. Unfortunately, as time went on picky collectors started to favor classic Nintendo and related systems instead. To this day pre-Nintendo video game collecting is full of great deals and even less buyers. Collectors are urged to use extreme caution in this area especially given the fact that Atari no longer exists as a present day video game manufacturer. A rebound in this area of the market just isn't probable.

It is a great time to be a buyer in any one of these noted categories. Unfortunately, if I was a gambling man the only category poised for a possible turnaround is the coins and paper money market. The numismatic marketplace is extremely complex and operates in various cycles. The question is how long before we enter into another growth cycle, and can the average collector afford to wait it out?
In part two of this series I will look at five collecting categories that experienced the most growth in 2015 and are poised to make gains in 2016. Will your favorite collecting category make the list? The results may just surprise you so stay tuned!


 

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