(Topic ID: 251296)

Investment returns on pinball collection in home-use scenario


By jackd104

7 days ago



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  • Latest reply 5 days ago by Luckydogg420
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-10
#1 7 days ago

Hey all,

We all know that pinball machines can be considered an investment. I was curious exactly what return my collection has brought (by the way, this is not of great importance to me, since pinball is a love/hobby, but I was curious since I’m a finance nerd in other aspects of life). What I mean by return (APY, annual percentage yield): what did I pay for a machine, how long ago was that, what’s the current value, and therefore what was the APY? How does that compare to other investments I could have made? All the machines are in good condition, 100% functional, players machines, except TSPP which is a superb condition HUO. And the results:

Funhouse
Purchase price: $1,200
Purchase date: March 2001
Time owned: 18.5 years
Estimated current value: $4,000
Return: 6.73% APY

The Addams Family
Purchase price: $4,500
Purchase date: December 2011
Time owned: 7.75 years
Estimated current value: $6,000
Return: 3.78% APY

Twilight Zone
Purchase price: $5,000
Purchase date: May 2012
Time owned: 7.33 years
Estimated current value: $6,500
Return: 3.645% APY

The Simpsons Pinball Party
Purchase price: $4,500
Purchase date: December 2014
Time owned: 4.75 years
Estimated current value: $5,300
Return: 3.51% APY

Average APY for the collection: 4.41%

My reaction... my emotions led me to believe the returns were going to be higher, but there it is. And I know I paid top dollar for most of them, so that affects the return of course. Finally, I suspect that if I factored in repair costs and parts, it would pretty much destroy my return. Boo hoo!

If you want to do something similar, find a future value calculator on the web (something like the link below). Num. of periods = the years you have owned the machine. Starting amount = the price you paid. Interest rate = fiddle with it until Future Value equals your estimated current value, and that is your APY. Leave Periodic Deposits at 0.

https://www.calculator.net/future-value-calculator.html?ctype=endamount&cyearsv=18.5&cstartingprinciplev=1200&cinterestratev=6.73&ccontributeamountv=0&ciadditionat1=end&printit=0&x=0&y=0

14
#2 7 days ago

I don’t see a factor for “fun experienced” anywhere in the algorithm?

That’s the greatest value to me

#4 7 days ago

I just enjoy them...

#5 7 days ago

Compare this to most hobbies, where the financials typically look like this...

- Bought XXX for $4,000
- Sold XXX for $2,000
- Return / Loss: -50% (sorry, didn't figure it out per year)

EDIT for clarification: My point is it's great that pinball retains value (not about making money), so ultimately it's not as expensive as many other hobbies.
I'd prefer prices didn't keep rising, but it's nice that they don't lose value. Most hobbies have very high % costs.

#6 7 days ago

Most pinball people here are not overly wealthy but have amassed collections with a value well into the tens of thousands or higher.

That is not possible without value escalation, flipping for profit and opportunistic under market value purchasing.

#7 7 days ago
Quoted from T7:

Compare this to most hobbies, where the financials typically look like this...
- Bought XXX for $4,0000
- Sold XXX for $2,000
- Return / Loss: -50% (sorry, didn't figure it out per year)

If youre in a hobby to make money, you are doing hobbys wrong.

#8 7 days ago

Pinball machines should be considered an investment just like Beanie Babies were considered an investment.
(Insert tulip bulbs for Beanie Babies if you are really old.)

#9 7 days ago
Quoted from Chitownpinball:

If youre in a hobby to make money, you are doing hobbys wrong.

Everyone here is "guilty" of flipping for profit. Its essential to participating in this hobby at all short of independent wealth and life financial circumstances not attainable by most people. In fact some here have turned it into a primary source of income. It can still be a hobby while profiting at the same time. Most just sink the profit back into the hobby but its still profiteering no matter how you look at it.

#10 7 days ago

What mostly worries me is if there is some kind of pricing... what the word I'm looking for...Balloon.

And, will this balloon, er...no that's not it...yes! Pop?

Are we in a pricing balloon and will it pop?!?!

#11 7 days ago
Quoted from Chitownpinball:

If youre in a hobby to make money, you are doing hobbys wrong.

There's 2 ways to look at it...
--- 1) How expensive is the hobby (the bottom line, after you get out)
--- 2) Trying to make money

I look at it as #1, and I think most people into pinball do the same.
If you lost 50% on most pinball purchases (like most other hobbies), there would be a lot less people into pinball.

#12 7 days ago
Quoted from Dkjimbo:

Everyone here is "guilty" of flipping for profit. Its essential to participating in this hobby at all short of independent wealth and life financial circumstances not attainable by most people. In fact some here have turned it into a primary source of income. It can still be a hobby while profiting at the same time. Most just sink the profit back into the hobby but its still profiteering no matter how you look at it.

This is where it teeters on just being a business and not a hobby. Most of these "businesses" prey on people who don't know any better. That's why you see the crazy prices. We all know they are crazy, but some one eventually wont, that's their prey. Money in the bank. Ive seen the worst examples get sold for ridiculous prices in retail. Its sad and frustrating to watch. Its the main reason I buy and sell ONLY within pin circles of people I know. If I cant vet some one, I wont even deal with them any more.

Its one thing to buy a game, fix it up, and sell it for a reasonable price. Its another to buy a game, barely do anything to it, and flip it for profit to a chump. Thats what you see more than anything. Chumps getting chumped.

#13 7 days ago

The other thing too about the profiteering in this hobby - the vast majority of it flies under the radar of the IRS. Profit on a sale as well as the "hobbyist operator" income in quarter drop. Is anyone actually reporting that to the IRS? So when you think about the profit, think about how much greater it actually is simply because no one is paying taxes.

Imagine if pinball transactions had to operate like vehicle sales...with registration dues and taxes...all required to be on record. at this point the dollar values are certainly at the level of low end cars / used cars in some cases.

#14 7 days ago
Quoted from Dkjimbo:

Everyone here is "guilty" of flipping for profit. Its essential to participating in this hobby at all short of independent wealth and life financial circumstances not attainable by most people. In fact some here have turned it into a primary source of income. It can still be a hobby while profiting at the same time. Most just sink the profit back into the hobby but its still profiteering no matter how you look at it.

Speak for yourself. I know a lot of people who probably lose money on every game they buy.

#15 7 days ago
Quoted from Chitownpinball:

This is where it teeters on just being a business and not a hobby. Most of these "businesses" prey on people who don't know any better. That's why you see the crazy prices. We all know they are crazy, but some one eventually wont, that's their prey. Money in the bank. Ive seen the worst examples get sold for ridiculous prices in retail. Its sad and frustrating to watch. Its the main reason I buy and sell ONLY within pin circles of people I know. If I cant vet some one, I wont even deal with them any more.
Its one thing to buy a game, fix it up, and sell it for a reasonable price. Its another to buy a game, barely do anything to it, and flip it for profit to a chump. Thats what you see more than anything. Chumps getting chumped.

I agree with you. All of my buying and selling lately has come down to a small group of mostly local (within a couple hour drive tops) people.

#16 7 days ago
Quoted from Dkjimbo:

Imagine if pinball transactions had to operate like vehicle sales...

Hmmm...Hadn't thought of comparing pinball to cars before!!

It's an eye-opener!

#17 7 days ago

Believe me, I'm in a lot of hobbies, mostly nerd/pop culture stuff (comics, movies, games, etc) and I realize in these and other hobbies (fishing, hunting, buying car/bikes/boats, etc) every hobby is expensive. I learned a long time ago you HAVE to enjoy the hobby you're in, because you rarely will get back all of the money you put into it. Like one pinsider said, how much value do you put into happiness and enjoyment?

But, to brighten your day, most (not all) of the time you can sell your pins and get good money for them. I can't tell you how many pins I sold to do and buy things for the house, family, other hobbies, etc. There is a market out there for them if you did decide to sell, just don't expect to get every penny out of the pin (especially if you like adding mods to them, like I do).

Or, just put some money aside for saving and investing and some money aside to do the things that bring you happiness. Good luck!

#18 7 days ago

I find this to be a rather interesting way of looking at my collection. Can someone smarter than me make an Excel spreadsheet that I can just fill in my game titles, purchase date and prices paid and have it calculate it all out? It would be wicked cool if someone could make that happen.

#19 7 days ago

The trick is selling at a good price. Easier to buy pinball's then sell them.

#20 7 days ago

BTW in regards to my earlier post, not trying to be a financial adviser to you, because you're the one who gets up everyday and goes to work and it's your money. Only trying to give advice to something I thought about years ago myself.

#21 7 days ago
Quoted from jackd104:

Hey all,
We all know that pinball machines can be considered an investment. I was curious exactly what return my collection has brought (by the way, this is not of great importance to me, since pinball is a love/hobby, but I was curious since I’m a finance nerd in other aspects of life). What I mean by return (APY, annual percentage yield): what did I pay for a machine, how long ago was that, what’s the current value, and therefore what was the APY? How does that compare to other investments I could have made? All the machines are in good condition, 100% functional, players machines, except TSPP which is a superb condition HUO. And the results:
Funhouse
Purchase price: $1,200
Purchase date: March 2001
Time owned: 18.5 years
Estimated current value: $4,000
Return: 6.73% APY
The Addams Family
Purchase price: $4,500
Purchase date: December 2011
Time owned: 7.75 years
Estimated current value: $6,000
Return: 3.78% APY
Twilight Zone
Purchase price: $5,000
Purchase date: May 2012
Time owned: 7.33 years
Estimated current value: $6,500
Return: 3.645% APY
The Simpsons Pinball Party
Purchase price: $4,500
Purchase date: December 2014
Time owned: 4.75 years
Estimated current value: $5,300
Return: 3.51% APY
Average APY for the collection: 4.41%
My reaction... my emotions led me to believe the returns were going to be higher, but there it is. And I know I paid top dollar for most of them, so that affects the return of course. Finally, I suspect that if I factored in repair costs and parts, it would pretty much destroy my return. Boo hoo!
If you want to do something similar, find a future value calculator on the web (something like the link below). Num. of periods = the years you have owned the machine. Starting amount = the price you paid. Interest rate = fiddle with it until Future Value equals your estimated current value, and that is your APY. Leave Periodic Deposits at 0.
https://www.calculator.net/future-value-calculator.html?ctype=endamount&cyearsv=18.5&cstartingprinciplev=1200&cinterestratev=6.73&ccontributeamountv=0&ciadditionat1=end&printit=0&x=0&y=0

Lol...you just converted the hobby into mortgage speak...you’re now my new favorite pinsider, and that means a lot coming from me since I’m people’s favorite pinsiders, favorite pinsider.

#22 7 days ago

Hmm, I wouldn't really consider pinball an investment when you purchase them for home use as a toy (of course routing them for profit is a different story). You also failed to account for the cost of maintenance, electricity, space allocation, mods added, cost of time spent on repairs, etc. as you would with any other true "investment" to calculate the true return. I get that maybe this helps with the justification to yourself or your spouse (who hasn't tried that with whatever significant purchases they make?), but ultimately as long as you enjoy them and can see the value of entertainment they deliver then all should be good.

#23 7 days ago
Quoted from CrazyLevi:

Hadn't thought of comparing pinball to cars before

IMO a NIB pinball holds it value a whole lot better than a new car. I had a NIB GB for over 2 years, it had 1750 plays on it when I sold it. I paid 5100.00 for it, sold it for 4000.00, never had any repairs or maintenance costs, so I ended up not only saving the quarters from going to a location, also the gas, etc. to get to a location. And the closest location to me is about 40 minutes or longer in bad traffic.

#24 7 days ago
Quoted from JohnnyPinball007:

IMO a NIB pinball holds it value a whole lot better than a new car. I had a NIB GB for over 2 years, it had 1750 plays on it when I sold it. I paid 5100.00 for it, sold it for 4000.00, never had any repairs or maintenance costs, so I ended up not only saving the quarters from going to a location, also the gas, etc. to get to a location. And the closest location to me is about 40 minutes or longer in bad traffic.

Cars are an expense not an investment, unless you're into classic or ultra high performance cars. Even then there are no guaranteed returns. However, I think you are looking at things correctly - Can I get the entertainment value out of something where I'm comfortable with the expense? I had this same approach for years with my Nautique wakeboard boat. When I finally got out of the sport/hobby, I was able to sell the boat for the principle balance I had left on the loan, and the few hundred I spent each month while owning it was well worth the entertainment value for me and my family.

#25 7 days ago

Wow!

This is all new to me.

How is it an investment if nobody's putting coins in them?

#26 7 days ago

The trick is to sell for MUCH more than you paid=PROFIT.

Learnt that thar from watchin that screamy Cramer guy

#27 7 days ago
Quoted from Wickerman2:

The trick is to sell for MUCH more than you paid=PROFIT.
Learnt that thar from watchin that screamy Cramer guy

Ohhh...so it's a PROFIT deal!

#28 7 days ago
Quoted from Wickerman2:

The trick is to sell for MUCH more than you paid=PROFIT.

True, but who's foolish enough to give you more money than than these things are worth?

#29 7 days ago
Quoted from CrazyLevi:

Ohhh...so it's a PROFIT deal!

+50 for The Jerk reference! "Take a chance and win some crap!"

#30 7 days ago
Quoted from o-din:

True, but who's foolish enough to give you more money than than these things are worth?

2 words or 1 letter and 1 word, E BAY....EM's go for 4 digits, HS2 is worth 15k on Ebay, there's an Old Chicago listed for 3k for crying out loud. IT'S A GOLDMINE!!!!! Just gotta know how to sell it. Say things like "fully serviced" when you have done nothing etc. It's easy money.

#31 7 days ago
Quoted from Dkjimbo:

Most pinball people here are not overly wealthy but have amassed collections with a value well into the tens of thousands or higher.
That is not possible without value escalation, flipping for profit and opportunistic under market value purchasing.

It's like you know me...

#32 7 days ago
Quoted from o-din:

Wow!
This is all new to me.
How is it an investment if nobody's putting coins in them?

Appreciation....in a perfect world........

#33 7 days ago

Buy NIB - sell - take a loss.
Buy a project, spend $$ to restore project - sell - take a loss.
Buy a CQ pin for top dollar, play it, maintain it (investing time and parts) - sell - take a loss.

and of course, the addition of Mods is addictive to some hobbyists, that means you'll def take a loss.

BUT! I have good news - enjoy the hobby and don't think of it as an investment and you'll never have to worry about taking a loss.

#34 7 days ago

To all who are viewing the OP negatively, as if he's only focused on the money and not pinball. Obviously he's not into it for the money, he's owned these 5 games for 5-19 years! The people focused on making money sell much more frequently. IMO he's only commenting on what the value of his collection has done. It's unfortunate we can't have even a little discussion of values without it going so negative - but using the wording "Investment" and "Returns" seems to do that on Pinside.

#35 7 days ago

I don’t pick up a pin unless I’m guaranteed 400-500% gains on sale. Which I of course, never report.

-1
#36 7 days ago

if you bought your games before 5 years ago you can make some money, if not, well then expect to break even or possibly even lose some on NIB.

#37 7 days ago
Quoted from Mr_Tantrum:

I get that maybe this (pins appreciating in value) helps with the justification to your spouse.

Nope. Tried that with my wife once. Purchased TZ in great condition for $1200 in 1995 and have added ColorDMD and a few upgrades since. When I told her what it should be worth now her response was wanting me to sell it for the profit. I've never sold a pin. I buy stuff because I want to own it. If she outlives me she can sell my stuff after I'm dead. If you sell a game for a profit then you don't own it any more, and where's the fun in that?

#38 7 days ago

Those are actually shitty returns on your money over that long of a period of time.

15
#39 7 days ago

It’s important to diversify your portfolio, so I have a mix of Williams, Gottlieb, Stern games.

#40 7 days ago
Quoted from Coindork:

Those are actually shitty returns on your money over that long of a period of time.

Dude you’re gonna cause a market crash with this kinda talk!

#41 7 days ago
Quoted from Coindork:Those are actually shitty returns on your money over that long of a period of time.

I thought the same thing. Someone did mention he doesn't consider the fun factor in his algorithm.

#42 7 days ago
Quoted from radium:

It’s important to diversify your portfolio, so I have a mix of Williams, Gottlieb, Stern games.

I just diversified with some Chicago Coin and I think I made a terrible mistake!

#43 7 days ago
Quoted from radium:

Dude you’re gonna cause a market crash with this kinda talk!

I say that, but I'm still buying pinball machines (not for investment thought).

#44 7 days ago
Quoted from Coindork:

Those are actually shitty returns on your money over that long of a period of time.

I feel like that was kind of the OPs point:

Quoted from jackd104:

Finally, I suspect that if I factored in repair costs and parts, it would pretty much destroy my return. Boo hoo!

Of course if you wanted to flip games for $$ you weren’t buying Addams and Funhouses and Twilight Zones but looking for those undervalued games that went from $1500 to $3000 in the last 8-9 years. So you got to own and play a game for years and you can sell it and get a weeks pay out of it. Woo!

#45 7 days ago

Consider pinball a negative equity equation.
A great, fun way to throw away unneeded money!

#46 7 days ago

Sounds like investment advice from WuTang Financial

tumblr_nzgoyqoWeB1ubqbqzo1_400.gif
#47 7 days ago

Pinball is actually helping me financially. I have became a whole lot more frugal with everything else. I used to eat out lunch and dinner 7 days a week for average of 20.00 a day(140.00 a week). Now I go out one night a week for dinner, and spend 40.00 or less for a entire week. I am saving 5200.00 a year alone on food for pinball. I rarely eat steak anymore, but I have never ate noodles either.

When I paid 5100 for GB and sold it after 1750 plays for 4000, my friend told me I had not lost anything, because I would have not had that game anyway if I had of spent the money eating out.

#48 7 days ago
Quoted from pinballinreno:

Consider pinball a negative equity equation.
A great, fun way to throw away unneeded money!

If I add up every play, the money going into a machine on location vs the money I get out of my games at home is about a push.

#49 7 days ago

I bought 20 machines 25 years ago--
And have swapped them, 2 at a time, in and out of my house from a "free" storage space.

Today-- Despite being in perfect shape, I'd say they are only worth what I paid for them PLUS shipping costs.

The only regret I have is that I sold two of 'em instead of swapping them for other machines.

I wish I would have kept the "Who Dunit?" to swap for a nice "Black Knight."
-and-
I wish I still had the "El Dorado" to swap for a nice "Fireball."

#50 7 days ago
Quoted from JohnnyPinball007:

Pinball is actually helping me financially. I have became a whole lot more frugal with everything else. I used to eat out lunch and dinner 7 days a week for average of 20.00 a day(140.00 a week). Now I go out one night a week for dinner, and spend 40.00 or less for a entire week. I am saving 5200.00 a year alone on food for pinball. I rarely eat steak anymore, but I have never ate noodles either.
When I paid 5100 for GB and sold it after 1750 plays for 4000, my friend told me I had not lost anything, because I would have not had that game anyway if I had of spent the money eating out.

Yeah, this is the attitude that seems the most sane to me. I picked up a High Speed, paid likely $100-200 more than I ultimately should have given the backbox was pretty trashed, but it was a title I really wanted. I've since put money into things like flipper rebuilds, Cliffy ball guides, and a Hardtop.

I'll likely unload it once I get the backbox done, but don't expect to make any money. If I lose some, that's more than offset by the fact that I can head upstairs and play whenever I want. Otherwise, I'd be heading out on location, buying one beer for half the cost of a sixer, etc.

It's like going to a casino: I never go expecting to make money. I go in knowing I'll toss a certain amount in a hole, but that I'll have fun doing it.

All about your philosophy, I suppose.

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