Flipping 101
Car flipping is a topic that often generates heated discussions amongst car enthusiasts. It involves purchasing a vehicle with the sole intention of selling it for a profit, without ever driving the car. Many consider it to be a taboo practice, while others see it as a legitimate way to make money. The question remains - is it fair to throw shade at car flippers, or is it just human nature to maximise opportunities to generate profit?
The process of car flipping involves selecting a vehicle that is in high demand and limited supply, placing a deposit on it, specifying the car, and waiting for it to be delivered. The next step is to find a buyer willing to pay more than the original purchase price, prior to collection. Finally, the car is purchased and sold for a premium.
One of the main benefits of car flipping is that it is simply a matter of supply and demand. When there is high demand for a particular car and limited supply, the price of that car is likely to increase. This allows car flippers to add a premium to the price they paid for the car, because people are willing to pay more for something that they want and cannot easily obtain. This means that there is potential to earn a significant returns. A recent example of this was the latest generation of Range Rover, with significant supply chain issues leading to excess demand for the new British 4x4 causing cars to sell for approximately 20% over retail price, allowing 'flippers' a profit of around £20k-£25k per car.
Another benefit of car flipping is that there is little to no risk involved. If you are unable to find a buyer for the car, you can simply say no to purchasing the car and the majority of the time get your deposit back. This means that you are not locked into a purchase if the market suddenly changes or if you are unable to find a buyer.
Additionally, you have the ability to pre-sell the car before they even collect it. By lining up a buyer in advance, you can ensure that you will make a profit on the sale and minimise the risk of being left with an unsold car. This allows you to have a high certainty of return before you even purchase the car, which can be a huge advantage in a competitive market.
Now you're probably thinking this all sounds too easy? While the process may seem simple, identifying the right cars to order far enough in advance to benefit from peak market demand is the real challenge.
Here are some cars Autofolio believe could catch the eye of ‘flippers’ at every price level:
2024 Porsche 718 Spyder RS
If you’re looking for the ultimate topless Porsche, look no further than the Porsche 718 Spyder RS. This 2-seater mid-engine sports car now boasts the latest 4.0 GT3 flat six, making it one of the most sought-after Porsches on the market. The sister car to the Spyder RS, the GT4 RS are currently trading on the open market for around £250k. As a result we can expect the same of the topless version.
Estimated premium: £100k
2023 Toyota GR86
For those with a smaller budget, the Toyota GR86 is a great option. The latest addition to the Gazoo racing family, this lightweight driver's car has received rave reviews from every automotive journalist that gets behind the wheel. With an estimated premium of £5k, the Toyota GR86 is an affordable choice for those looking to get started in the car flipping
Estimated premium: £5k
2023 Ranger Rover P440e Autobiography
If luxury is what you’re after, the latest full-fat Range Rover hybrid is the ultimate British luxury car. There is a huge demand for these cars from business owners, given the UK tax benefits of purchasing a hybrid vehicle through a business. With an estimated premium of £15k, the Range Rover P440e Autobiography is a great choice for those looking to flip luxury cars.
Estimated premium: £15k
2023 BMW M3 CS
The last and greatest hardcore M3 is more tuned in and track-biased. The BMW M3 CS is a popular choice among car flippers. This car is perfect for those looking for a high-performance car with a limited production run. Based off current valuation of M4 CLS we would expect the limited run M3 to continue this tend.
Estimated premium: £20k
2024 Ferrari Purosangue
Ferrari SUV?! You would expect Enzo to be turning in his grave! However in 2023 more and more Ferrari clients have more money than taste. As result the Ferrari Purosangue is a great choice for car flippers. Ferrari’s first-ever SUV is perfect for those who want the V12 prancing horse for all the family. With an estimated premium of £250k, the Ferrari Purosangue is the ultimate choice for those looking to make a large profit in the car flipping business.
Estimated premium: £250k