Pricing and flight to quality

[MCoxon]

Hi - just wondering if any one has seen similar trends. I've been looking at auction prices realized, for cards I've purchased in the past 3-5 years

I'm seeing very large jumps on:

* Mantle, Aaron, Mays, Jackie Robinson. Example: 1953 Bowman Mantle PSA 4 from $550 to $1050 (purchased 2017); 1955 Topps Aaron from $250 to $646 (purchased 2017); 1953 Satchel Paige, PSA 5, from $360 to $750 (purchased 2016)

* Early 1980s rookies, especially Mattingly, for example 1984 Topps PSA 10 from $150 to $520 (purchased February 2020)

* Any Jordans (1985 Nike promo in PSA 9 from $300 to $1500 since Oct 2019; 1986 fleer sticker in PSA 8 from $300 to $1500 or so); 1980 Bird/Erving/Johnson in PSA 6 from $270 to $1053. This is in the last 6-9 months


I'm seeing very little appreciation in lesser stars or regional issues
* Feller, Banks, etc. haven't moved much in the 3-5 years, whether Topps, Bowman, other
* Regional or non-mainstream issues like Kahn's, Bazooka, Picture Packs, etc


So it seems like Topps and superstars are seeing massive jumps, while non-stars aren't. Is this something expected and seen before in previous crises like the 2008 financial crisis (I wasn't collecting then)?

[Gorditadogg]

New collectors, new money is coming in. They are buying what they know.

Sent from my SM-G955U using Tapatalk

[swarmee]

There is a big thread on the main board about this to take a look at.

[MCoxon]

Thanks will look there. Figured it was a well-discussed topic, just wasn't sure where discussed or when. Haven't been on the boards for a couple of years even though I have still been collecting

[62corvette]

Regarding the non-mainstream/regional group, the 1975-1979 Hostess have increased in value significantly.

[Seven]

It was mentioned over posts in the other thread but the popular theories that were being thrown around are.

1. More people are getting into/getting back into the Hobby due to the amount of downtime because of Coronavirus. A good portion of people are working from home due to the pandemic, or have outright decided to retire. The amount of free time available to get back into hold hobbies or pursue new ones is a factor.

2. People using cards as a vehicle for investment. Whether for better or worse something will happen with the market come November. Gold is being invested in more heavily and it appears cards are also being seen as a viable investment. There's always a market for big names.

3. More disposable income. Traveling has become difficult. Can't go to Europe or a tropical destination (Aruba withstanding) during this time. Hell it's even difficult to travel from state to state depending on where your going or coming from. Social gathering places are limited as well. No one is going to a club, or a concert, broad way show, etc. People have money left over that they would've normally spent by now. Might as well put it into a hobby they enjoy.

Whether you think the prices will come down or not is a different story. I'm in the camp that believes they will. Others, not so much. One thing's for sure, the Hobby is doing well.

[kailes2872]

Originally Posted by Seven

2. People using cards as a vehicle for investment. Whether for better or worse something will happen with the market come November. Gold is being invested in more heavily and it appears cards are also being seen as a viable investment. There's always a market for big names.

For the life of me, I can't understand why people are using it as an investment. By the time you pay 22% buyers premium on the buy side and 10% commission on the sell side (assuming no discount rate is given), it is tough to even break even. If you add to the fact that capital gains rate on collectibles is 28% - more than the tax rate for married filing jointly up to $326,600 (24%) - cards as an investment make other people money but it is tough to break even - even after holding onto the cards for a few years.

Somewhere along the way, the collection moves from a hobby to an asset class. I don't want to have to go to a safe deposit box to visit my collection. I don't want to have a ton of value in the house and have them at risk for fire or theft. This thread has me thinking long and hard about what to do in the future. For the first time, I have been clicking on the consign now banners and investigating what that means. It is something that I wouldn't have even thought to consider even a year ago.

[swarmee]

Oh, you think these guys are paying taxes on their earnings?

[kailes2872]

Originally Posted by swarmee

Oh, you think these guys are paying taxes on their earnings?

Well, since it is a public forum and our names are in listed, then I assume that all taxes are paid.

[swarmee]

Originally Posted by kailes2872

Well, since it is a public forum and our names are in listed, then I assume that all taxes are paid.

It's funny how often I see this question on forums: "Do you get a 1099 from PayPal with 200 transactions *and* $20,000 in sales *or* either 200 sales or $20K?"
I'm mainly talking about all the modern basketball flippers on blowout. But whoever reports these guys to the IRS and takes the referral money will probably out-earn all of them... ;-)

[savedfrommyspokes]

Originally Posted by kailes2872

For the life of me, I can't understand why people are using it as an investment. By the time you pay 22% buyers premium on the buy side and 10% commission on the sell side (assuming no discount rate is given), it is tough to even break even. If you add to the fact that capital gains rate on collectibles is 28% - more than the tax rate for married filing jointly up to $326,600 (24%) - cards as an investment make other people money but it is tough to break even - even after holding onto the cards for a few years.

Don't forget (unless they reside in a handful of states) that these investors are also now being charged 6-10% for sales tax.....unless of course they also have a resale license.

[Exhibitman]

Originally Posted by swarmee

It's funny how often I see this question on forums: "Do you get a 1099 from PayPal with 200 transactions *and* $20,000 in sales *or* either 200 sales or $20K?"
I'm mainly talking about all the modern basketball flippers on blowout. But whoever reports these guys to the IRS and takes the referral money will probably out-earn all of them... ;-)

Back around 1990 I was setting up at local shows selling mostly vintage baseball. Doing OK most weekends and having fun. One weekend I was at a show in North Hollywood CA and the guy next to me was doing crazy business on 1989 Upper Deck cards, which he had stacks of. Between customers he started telling me what a gold mine modern was, how he'd opened cases of 1989 UD and was selling thousands and thousands in Griffey, Sheffield and the other hot RCs and error cards (remember the Dale Murphy reversed neg?). Anyhow, he went on for a while about how it was all cash, no taxes, etc. He asked me what I do. I told him I am an attorney. He asked for who. I said that I was an assistant US attorney in the tax fraud division at the Justice Department. He turned so white I thought he was going to have a heart attack. I quickly let him know that I was a construction attorney so he wouldn't stroke out.

The moral of the story is that if you are gonna cheat the tax man, STFU about it...

[MCoxon]

Originally Posted by 62corvette

Regarding the non-mainstream/regional group, the 1975-1979 Hostess have increased in value significantly.

Thanks Mike. The fact that Hostess has gone up is interesting, this was the crux of my post

I have spent lots of time with oddballs like Bazooka, Kahn's, Kellogg's, team picture packs and autograph cards (e.g., Pirates/Clemente)

And what I noticed is that my common, PSA 6-7 1955 / 1956 HOF Topps cards, with large pops, like Aaron and Mays, have doubled and even tripled in price. Meanwhile, the rare Kahn's of Clemente, the low pop high grade Milk Duds boxes, the low pop high grade Nabiscos, the low pop but high grade Dormand Mantles with Bat on Shoulder haven't moved much. Feels like I wasted $$$ buying the low pop cards, rather than just continuing to upgrade mainstream Topps issues

I was wondering if anyone had noticed that it's all mainstream issues (Topps for baseball, Fleer for basketball), and not the other non-mainstream issues appreciating so much

[Tere1071]

The oddball cards often present an artistic value apart from the regular issue cards. You didn't waste your money.

[puckpaul]

Newsflash....too late, it has already happened. You need to consider all you are afraid of.

Originally Posted by kailes2872

For the life of me, I can't understand why people are using it as an investment. By the time you pay 22% buyers premium on the buy side and 10% commission on the sell side (assuming no discount rate is given), it is tough to even break even. If you add to the fact that capital gains rate on collectibles is 28% - more than the tax rate for married filing jointly up to $326,600 (24%) - cards as an investment make other people money but it is tough to break even - even after holding onto the cards for a few years.

Somewhere along the way, the collection moves from a hobby to an asset class. I don't want to have to go to a safe deposit box to visit my collection. I don't want to have a ton of value in the house and have them at risk for fire or theft. This thread has me thinking long and hard about what to do in the future. For the first time, I have been clicking on the consign now banners and investigating what that means. It is something that I wouldn't have even thought to consider even a year ago.

[mrmopar]

I can speak about Steve Garvey RCs and now to some extent 72T. I watch those is graded 8 or better sales. I would say at the begging of the year, 8;s were selling in the $100-125 range pretty consistently. Not I see then in the $200-250 range, but 7's starting to break $100 (when this was an under $50 card all day before).

The 72T 8's would usually settle in around $40 or less on a good day (for the buyer). Now, I see those creeping up too, getting closer to $100.

I guess it is good to see, except I never got my 71 PSA8 at the price I wanted before, now I will have to settle for a 7 being the best I can hope for.

[HRBAKER]

Pricing is not based on "pop" alone. Esoteric regionals and food box cards have never enjoyed the wide appeal and draw as have regular issue cards. A lot of buyers have no idea of their existence or what their "pop" is. Many people as the poster mentioned before, new or old get swept up in collecting what everyone else does by and large.

I type this as a collector of Bazookas and Hostess cards and other regional issues. They have long had appeal for me as they are unusual and not everyone has one. Typically they have different photos.

I'd take a VG '56 Kahn's Frank Robinson over a PSA8 1957 Topps all day.

[cardsagain74]

Originally Posted by kailes2872

For the life of me, I can't understand why people are using it as an investment. By the time you pay 22% buyers premium on the buy side and 10% commission on the sell side (assuming no discount rate is given), it is tough to even break even. If you add to the fact that capital gains rate on collectibles is 28% - more than the tax rate for married filing jointly up to $326,600 (24%) - cards as an investment make other people money but it is tough to break even - even after holding onto the cards for a few years.

Transaction costs are the most misunderstood and ignored factor by the majority of people (whether it be baseball cards, stock options, making a bet in a sportsbook, you name it). And the prevalence of them for a particular trade or investment is so paramount to someone's bottom line.

I've seen people (who are otherwise great with money and experienced securities investors) buying and selling options with a bid-ask spread of 5.25 by 6.50. Similar to your example of what happens in the card market using ebay or auction houses.

No sign of this changing though. People still like to attempt flipping cards regardless of that uphill battle from the beginning, and the market's done so well lately that it disguises how tough it is during times like this

[MCoxon]

Originally Posted by HRBAKER

Pricing is not based on "pop" alone. Esoteric regionals and food box cards have never enjoyed the wide appeal and draw as have regular issue cards. A lot of buyers have no idea of their existence or what their "pop" is. Many people as the poster mentioned before, new or old get swept up in collecting what everyone else does by and large.

I type this as a collector of Bazookas and Hostess cards and other regional issues. They have long had appeal for me as they are unusual and not everyone has one. Typically they have different photos.

I'd take a VG '56 Kahn's Frank Robinson over a PSA8 1957 Topps all day.

I am similar, I like the bazooka boxes and panels, and lots of the regional issues as well. I guess to some extent they are remaining relatively more affordable for those who enjoy them which is good.

The Garvey experience of the 71T and 72T is very similar to what I've seen for others like 1975 / 1976 George Brett, etc.

[MCoxon]

Another phenomenon is a jump in the early junk wax era cards. I've particularly noticed 1984 Fleer updates / 1985 base cards for Gooden, Clemens, Puckett etc. doubling or tripling, compared to prices in Feb. when I was buying 1984F-Us for those 3...

the 1985s have also gone up (Topps, Donruss, Fleer) tremendously for those 3, not just the Updates...