Liquid Assets 335 Edition
Easiest ES to sell is a 64 with a Bigsby and Custom Made plate. They fall in the sweet spot price wise for many buyers, they sound great and play great and they have the bigger neck that everybody seems to want. Priced correctly, these don’t last more than a week or two. Usually more like a day or two.
Over the course of years, ES-335’s from 58 to 64 have proven to be a pretty good investment. Yes, the bottom fell out in 2008 as it did in the real estate market and almost every other market but the recovery has been slow and steady and most models continue to rise. There are exceptions and there are standouts. Bear in mind, I’m not an investment counselor but I know this market so I have some street cred.
There are a couple of things to look at if you are going to convince yourself (and your wife) that the expensive vintage guitar you are looking to buy is an investment. First is, of course, how much can you expect it to appreciate over time. That’s the one nobody can really predict. That’s where the big boys tell you that “past performance is no guarantee, blah, blah, blah”. Professional ass covering is what it is but it’s true. There is no crystal ball. But there are trends, though and the trend has been a steady upward climb in prices for 335’s. That’s the safer kind of price rise. The “irrational exuberance” of 2006-2008 is not happening this time and as long as it doesn’t, the rise could continue back to 2008 levels. And it might not. One thing I can say with some confidence is that the cream of the crop will rise faster than the player grade stuff. There is simply less of it and the demand is still fairly high for collector grade guitars from the fifties and sixties. Note that they ain’t making any more. After 50 or more years, it only makes sense that the number of collector grade guitars not already in the hands of collectors is diminishing. So, don’t look for bargains. The likelihood is that the collector grade guitars that come to market are coming from the collectors themselves. Player grade guitars can be a good investment as well for reasons you might not expect.
That’s where liquidity comes in. Lots of players who buy guitars from me are stretching their finances to get something from the era that has some issues but is still a decent investment that will at least hold its value and perhaps appreciate ahead of inflation. The question that often arises from buyers like this is “what if I have to sell it?” Here’s a good example. You’ve got $12000 to spend and you can buy a Bigsby 64 with some further issue like Grovers on and off or maybe a wrong part or two-nothing drastic like a refinish or repair. For that same $12000, you can buy a no issue 61 ES-345 stop tail in really good shape. Not mint but, say, a 9.0. Which is the better investment? I would say the 64 for this type of buyer. First, he’s going to play it, not put it in a closet and that 9.0 condition 61 may not stay 9.0 forever. Moreover, and this is key, the 64 is way easier to sell. There are many more buyers for a well priced 64 335 than any well priced 345, even the very sellable and desirable big neck early 59. You may ultimately get more dollars for that nice 61 ES-345 but you won’t necessarily get them quickly and sometimes speed is more important than actual dollars. Another great example of this is rare one offs. I love one offs and rarities and have trouble resisting them. I’ll take any black 335 (or Pelham Blue Trini) that comes along and not worry that it might take me a year to sell it. That way I get to play it for a year. But for you as an investor? Maybe not such a great idea unless you know you’ll never have to sell it.
So, which 335’s are the easiest to sell? Red 64 ES-335’s are the easiest for sure. It doesn’t even matter what condition-there are buyers for mint ones and buyers for beaters. Bigsby/Custom Mades are less desirable than stop tails but they sell faster because they can be thousands of dollars less. Late 63 335’s too. Next, even though the price range is totally different, are 59 dot necks. 58 335’s are up there too. That leaves 60, 61, 62 and early 63’s. Great guitars-all of them and good investments too. They will rise with the market and always have buyers but simply not as many buyers as the others. The reason for this is simple. Big neck guitars sell better than slim necked ones. I’m not sure more players actually prefer them but the investor does for sure. You’ll pay a premium but you’ll also have an easier time recouping your investment should the need arise. And you can play your investment. Let’s see you play “Steppin’ Out” on an Apple stock certificate.
One offs and oddities tend to be much less liquid but often more valuable. I love them. This is a very early red 59 with a factory Varitone. This is probably the second red dot neck made. How cool is that?
Interesting,
how would you rate an early 60 335 with a big neck? Mine was shipped in March 1960 and has all the 59 features.
Best Frank
In general, a 60 with 59 features would be only slightly less liquid than a 59. The problem is that even though the guitar is virtually identical if it has the big neck, single ring Klusons and the bonnet knobs, there will the perception that it isn’t a 59. Check the FON, if it starts with an “S”, you can explain that it was built in 59 and shipped in 60. It is certainly worth more and easier to sell than a later 60 with a small neck. I buy big neck 60 dot necks whenever they come up for sale because they can be a relative bargain when compared to a 59.
Good points. The old “Buy what you like and want to play and if you make a buck or two when you sell it” philosophy seems sound too!
Let’s not conflate investments with hobbies. Given the illiquid nature of the vintage guitars and the high commissions (20% or more) and the cost of insurance on your collectable it’s hard to convince me that if you have $12K to “invest” that the money wouldn’t be better put into a low cost index fund. Not as much fun or near as cool, but a better investment. I had large collection of vintage guitars but sold them after convincing myself that the price-performance curves meet at around $2K and never looked back. Well, almost never. I do miss the 1960 Custom Telecaster.
“I do miss the 1960 Custom Telecaster.” That’s the key right there. Do you miss your stock in Yahoo from 2000? Having something you enjoy on a regular basis that may increase in value is a good investment even if the return doesn’t meet your criteria. Breaking even but having been able to play that great guitar is reward enough. Guitars seem pretty liquid to me. I can sell an investment grade dot neck in a week or less.
The price performance curve may not be as high as some investments but the tone-performance curve is much better. Stock certificates sound like crap-especially at high volumes.