by Dave » Thu Sep 15, 2005 2:38 pm
This has been a very interesting discussion and I hope we can keep it up.
As most of you know, I am not a dealer but really consider myself a collector (but not one of the big boys). The only time I sell machines is when I run out of room or when I get duplicates.
In my opinion, I don't think the common slot machines (Castle Front, High Top, etc.) machines RETAIL value have really moved much in the last 10 years.
However, thanks to the Internet and E-Bay, the wholesale value has increased dramatically. Therefore, the margins have significantly decreased. I agree with Nick in that I don't see how a dealer can really survive these days. There is not enough margin in the low end stuff and the high end stuff is too hard to find. With the price of gas and hotels these days why even bother going to a show if, from a buyer's perspective, all you are going to see is overpriced common machines or a bunch of reproductions, or from a seller's perspective not many buyers? I have not been to Chicagoland for several years. If I do go, it will be mainly to keep in touch with the dealers that I know. I really won't expect to buy anything.
Before E-Bay, people sold their machines by placing them in the for-sale section of the paper and pickers could find them pretty cheap and they would then sell them to the dealers. I think those days are long gone. Now all a person has to do is get on Google and he/she immediately has access to several dealers & collectors. Ten years ago I picked up a lot of good machines by reading the ads in the newspaper and Penny Saver type publications. Today, I don't even bother looking.
Now the more desirable and rare stuff is a totally different story.
I think people are of the opinion that the good & rare stuff has all been pretty much found. In addition, most of this stuff is buried in a collection and will probably stay there for a very long time. Therefore, when a desirable/rare piece does come up it will bring a premium price. Once it brings a premium price all the other people who own one will know about it and they will not sell their piece for much below that. For the most part, people who own the rare/desirable stuff are not hurting for money and probably don't care that much if they sell it or not. Therefore, the only way to get it is to pay the going price or have something that they want and you are willing to do a trade for it.
A good example of this is the Buckley Bones dice machine. For years, these sold for less than $5,000. However, a couple of years ago one sold for, I think, around $18,000 at a major auction house. A little later, another one sold on E-Bay for around $16,000. The new price had been set and everyone who heard about these auctions and had a Bones machine would not part with it for under $14,000. Dealers now know that they can get in excess of $12,000 for one so when one does show up on E-Bay a dealer can become very agressive. I don't think Bones machines will ever fall back to under $13,000 simply because those who own them will refuse to sell them for less.
The same thing happened with the Caille Aristocrat. One sold at auction last February for $29,000 (+ 10%). One showed up on E-Bay a few months ago and it did not hit reserve at the $20,000 level. I talked to the owner and he wanted $25,000 for it. He knew that one had just sold for $29K + 10% and he thought $25K was a bargain. My personal feeling is that the one in PA will bring $25K - $30K. If in fact it does, I don't think anyone will be able to buy one from an existing collection for under $22K.
Actually, if you think about it. If the Caille floor model Roulettes are going for say $175,000 then an Aristocrast should bring about $25,000 since in the past they typically brought about 15% of what the full size model brought. 15% of $175,000 is $26,250. 15% of $225,000 is $33,750 which is almost exactly what the Aristocrat sold for last February at the Julia auction.
It will be interesting to see what the Caille floor model Roulette will bring at the LV auction. I don't think it will bring $225,000 like the last one did. The last one, from what I hear, was probably one of the nicest quarters ones ever seen. However, if the one in Vegas is in good shape I would not be surprised to see it bring in excess of $175,000. If that does occur, I don't think you will ever be able to buy one (from a dealer or collector) for less than $170,000. Your only hope of getting one for a lot less is to hope someone finds one in a basement, contacts you, and no one else. I think you have better odds in winning the lottery.
I think the rare/desirable stuff will always bring premium prices. I don't think prices on the common stuff will move very much at all.