An Upturn In Trains

For the past ten years or so trains have been slumping in price. It has been a tough experience for everyone involved, but I have some good news, (I think)!

I believe that the train market bottomed out sometime in 2005. It isn’t easy to figure exactly when it happened, but in hindsight and a little research. The market has been flat or in a little upturn since then.

I’ve received a couple of comments from customers stating that they thought there had been a change in the market for the positive. Yesterday a customer made a comment that vintage HO was hot, which made me think further on the subject.

My research comes mainly from buying and selling train collections. After buying a collection I have to process it. When I process collections say for a modern freight car I have lots of data as to what we asked for the item and what we actually received. In more and more cases I have noticed the trend has been up.

As a former coin dealer, I have experience with up and down markets. Unfortunately I got out of the coin market when it was in it’s darkest days in the early 1980's after gold and silver had crashed. The reason I got out was because it was very difficult to find new inventory, but then when you did, it was just as difficult to sell it. The market had come almost to a complete standstill.

That never did happen in this train market. I was always able to buy and sell. The big difference was that the values kept going down.

Now that we have hit that bottom line in the train market, hopefully prices will be at least stable for some time to come. Here are some predictions I have for the train market in the future.

Unfortunately we don’t have the state quarters to restart the train market like the coin market did. We won’t need them though. I’ve already seen this happen in the case of high quality Lionel pre-war, post-war, and American Flyer post war. People who are in other hobbies, especially coins are going to take some profits from their high quality buys and transfer it to trains. I know that’s already happened. They know that the rarest of the rare is high quality EX+ condition items, and let’s face it in coins high quality has gone through the roof. I predict that new pre and post-war will do the same in the near future. It is hard to buy EX+ items now. Just wait a couple of years!

Although maybe not as drastic, I predict that the entire train market will experience a complete turn around in pricing. The next generation of train enthusiasts is out there right now. Did you ever notice how most of us are getting older? The last Classic Toy Train survey had the average age of a train enthusiast at around 42 years old. (This is hear say as I think that’s what I was told around a year ago. My memory isn’t what it once was!) I was also told that age has stayed around the same for some time.

Remember when you loved trains when you were a child. Then around the age of 14 to 17 you put them away because of a disease called ‘girls’? Well that’s pretty common. Then you go through the ‘college thing’, then the ‘I don’t have any money thing’, then the ‘got married and struggling thing’, then ‘babies thing’! Well when did your interest in trains come back? Just after the ‘babies thing’ is when most people get back into that ‘train thing’. It happens over and over and over. (No you aren’t the only one!) I see people emerge all the time. You can’t believe how many new train enthusiasts there are out there. They just haven’t gotten to the ‘baby thing’ yet! They will.

I predict that at least one other major manufacturer will be eaten up or go out of business. (Believe it or not this will be a good thing because manufacturers have been hurting the market by flooding it with new inventory over the past 10 years. They need to slow down a little bit for the health of our hobby!)

I predict that foreign money will flood into the train market at some point in time creating a spike up in prices of tin plate type electric trains. Smart investors buy commodities when they are down and sell when they are high. Coins are high, trains are low. You figure it out!

I predict that enthusiasm for electric trains will never die. It’s like a sickness or fever that you catch. But our market unfortunately will be driven by business sense more than enthusiasm in a commerce sense.

I predict that I’m done with this article, and am going to go to work right now.

(There see.... I got at least one right!)

Charles Siegel