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USA Today article on LEGO investing and Brickpicker.com

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Comments

  • LusiferSamLusiferSam MontanaMember Posts: 493
    Oh, this is bad, this is very bad. The promotes the same kind of the idiotic behavior the creates bubbles with other collectibles. I'm sorry but these people aren't "investors," they are speculators. Speculators try to guess were the next "big thing" is going to be and then try to get in on the action. In the end they do terrible damage. It's a get rich quick scheme

    It's my opinion that the Star Wars and many of the licensed sets are suggestively over price in the secondary market. Very few set produced in the last decade are really rare. Most seem to have unusually high demand. Sorry but a five year old, mass produced set shouldn't be worth 5 to 10 times it's original value.

    Truly rare sets like 371, 824 and 321 should and are worth a lot. Why? Well they really are rare and hence hard to find. My guess is that there are more UCS Falcons than any of those three. But the UCS Falcon simple has higher demand because of the speculators.
  • y2joshy2josh Member Posts: 2,002
    edited December 2012
    ^I think being one of the most iconic ships in Star Wars combined with the likelihood that nothing similar will ever be produced probably helps the Falcon considerably.
    mressin
  • dougtsdougts Oregon, USAMember Posts: 4,129
    I don't think speculators are buying falcons for $2000+ hoping to see it go up. These things are mostly being opened and built, along with CCs, TMs, GGs, etc

    That's what makes this different than the other collectibles - the supply isn't just being shifted around from person to person but staying constant in number, it's actually dwindling after most sales

    Don't get me wrong the days of epic returns on EOL sets are largely over but 2 to 3 times rrp on quality EOL sets isn't going to end anytime soon
  • btmarine23btmarine23 Member Posts: 3
    edited December 2012
    Long time lurker, I just wanted to echo an above statement. I think so many sets are being opened that this hobby will look a lot different in ten years. You'll see collectors who drift towards sealed and builders towards opened.

    With the exception of maybe Minecraft any person with money can buy exactly what they want when it is released. This makes it a little different than other hobbies, plus those sets are usually opened...so people buying at low prices then reselling will still have a place...

    I think the speculator will give way to a person who can manage sealed and opened sets and become a dealer ...imagine what it is going to be like in 15 years trying to buy 9490...sealed. They aren't making less Star War fans, they aren't making less lego fans...this hobby is still in the beginning stages and we have Lego (like Topps or Marvel) managing their IP. Disney owns Star Wars and marvel now...so Lego has their work cut out for them.

    Having said all that, here is what I really think, collect what you love and take care of it. If other people think its valuable, that's great. Our kids now will grow up, have families of their own and rediscover Lego...how much will my kids pay for a 25 year old Star wars set?? I think that depends on how Lego manages the property..if they do a good job, the money people are making on reselling now will seem like change to people who were selective and put good quality sets away.
    Rainstorm26forumreaderevileddie1313atkinsar
  • LEGO_HULKLEGO_HULK Member Posts: 20

    Long time lurker, I just wanted to echo an above statement. I think so many sets are being opened that this hobby will look a lot different in ten years. You'll see collectors who drift towards sealed and builders towards opened.

    With the exception of maybe Minecraft any person with money can buy exactly what they want when it is released. This makes it a little different than other hobbies, plus those sets are usually opened...so people buying at low prices then reselling will still have a place...

    I think the speculator will give way to a person who can manage sealed and opened sets and become a dealer ...imagine what it is going to be like in 15 years trying to buy 9490...sealed. They aren't making less Star War fans, they aren't making less lego fans...this hobby is still in the beginning stages and we have Lego (like Topps or Marvel) managing their IP. Disney owns Star Wars and marvel now...so Lego has their work cut out for them.

    Having said all that, here is what I really think, collect what you love and take care of it. If other people think its valuable, that's great. Our kids now will grow up, have families of their own and rediscover Lego...how much will my kids pay for a 25 year old Star wars set?? I think that depends on how Lego manages the property..if they do a good job, the money people are making on reselling now will seem like change to people who were selective and put good quality sets away.

    I don't think I could have said it better myself. Very good outlook on the entire discussion!
  • pharmjodpharmjod 1,170 miles to Wall Drug, USAMember Posts: 2,899
    I am doubtful that sets held onto for 10-15 years will on average be good investments. I grew up with Lego. I loved it as a kid. I have the means to do so, yet I do not pursue old sets from my childhood. I realize that in many / most cases the current production is simply better. Of course there are exceptions, but generally speaking, aside from nostalgia, I have no real interest in really old sets.

    Sure, some people will, but I have been buying, selling and collecting for over 10 years now. I can tell you I would mutch rather have a recent (last 2 years) retired set to sell in most cases vs a set from 10 years ago. Again, there are exceptions, but when you look at the lost investment of buying, selling and repeating the whole process, a single set held for 10-15 years with the intent of resale is a fairly poor investment choice. Just my $0.02 worth anyway.
  • dougtsdougts Oregon, USAMember Posts: 4,129
    ^ yeah, not sure why anyone would hold onto them that long. sets from ~2000 don't seem to be generating a ton of excitement. the sweet spot is 1-3 years past retirement - new enough where it's still current and enough people missed it who still want it.

    the other side of the coin may be in decades old stuff I suppose, but who wants to sit on something for 20 years?
  • FatMattFatMatt USMember Posts: 502
    ^^I agree with you on the poor investment aspect of it, however I believe that some sets from today will sell better in 20-30 years than sets from 20-30 years ago sell today just because of the licensing. I think many licensed sets will be sought after then, that is if life remains as we presently know it. But, as dougts said, who wants to sit on a set for that long?
  • LEGO_HULKLEGO_HULK Member Posts: 20
    I really think there are a lot of great sets from the past couple of years that will still be wanted 10 or so years from now. A set like Tower Bridge will be retired and I think there are a lot young people now that would love to build it 10 years from now. The Star Destroyer (10030), is just an amazing set that any young kid today that my be the next Star Wars addict and want to build it. Sure I don't really care much about older '70s and '80s sets either, but they are pale in comparison to what has come out in the past 5 or so years. These sets are what made LEGO what it is today for a reason. They are just great sets, and I don't feel its an apples to apples comparison.
  • pharmjodpharmjod 1,170 miles to Wall Drug, USAMember Posts: 2,899
    Fair enough, but by your current logic, sets 10 years from now could and will likely make this current batch of stuff look pitiful as well. I see way to short of attention spans in kids in my job (pharmacist) to ever hope in 10-20 years they will be looking at old toys. Kids then will probably want whatever there is that has a cartoon at the time.

    You do bring up a valid point with licensed stuff and other really high end models. I would argue that Star Wars has already shown what to expect in the future now though. I wouldn't pay much of anything for a single set from the first release now (and I bought every single one when they came out). Why? Because 13 years later the sets are so much better. I do not expect this trend to change. What is an unknown are the one and done licensed themes (Indiana Jones for example). Though now that Disney has the Lucasfilm library, expect more of those, and subsequently more sets from the first 4 films. I know one thing, I'll probably be buying sets and selling them then as now. And I'm sure we will be having similar if not the same conversation then also :)
  • itsnotmeitsnotme Member Posts: 111
    As far as the pure investment angle, keep in mind that the figure one should attempt to maximize is internal rate of return, not absolute dollar return irrespective of time frame. It's better to consistently sell for 2x your cost basis in two years (41% IRR) than 10x your cost basis in 10 years (26% IRR).
  • btmarine23btmarine23 Member Posts: 3
    For some reason I think a lot of people will collect Lego 12 years from now and they are going to be like wow, 1st release marvel and 1st release Lotr. Again it may not seem significant now but those aren't exactly weak, fly by night, intellectual properties...they are significant and will be just as relevant then as they are today. Maybe its tough to see through all the noise but I think long term Marvel/DC, probably LoTR, will have a captive audience. I think its highly likely that people, whether its sane or not, will collect every marvel set ever made and just like comics they will want them pack fresh untouched by kids and drool.

    I look at Lego and think of Apple. Lego (like Apple) is so much more relevant today than it was 10-15 years ago...its in millions of home both by the brick and digital....and I think they are just starting to find good soil.
    evileddie1313
  • evileddie1313evileddie1313 Member Posts: 126
    edited December 2012

    Oh, this is bad, this is very bad. The promotes the same kind of the idiotic behavior the creates bubbles with other collectibles. I'm sorry but these people aren't "investors," they are speculators. Speculators try to guess were the next "big thing" is going to be and then try to get in on the action. In the end they do terrible damage. It's a get rich quick scheme

    It's my opinion that the Star Wars and many of the licensed sets are suggestively over price in the secondary market. Very few set produced in the last decade are really rare. Most seem to have unusually high demand. Sorry but a five year old, mass produced set shouldn't be worth 5 to 10 times it's original value.

    Truly rare sets like 371, 824 and 321 should and are worth a lot. Why? Well they really are rare and hence hard to find. My guess is that there are more UCS Falcons than any of those three. But the UCS Falcon simple has higher demand because of the speculators.

    Bubbles in other collectibles are created by the companies making the product. They overproduce an item, making it worthless, to meet demand of speculators. I have not or do not see LEGO doing this to make a small percentage of their customers happy. You must understand, the vast majority of LEGO sets are sold to children, who care very little about Return on Investment or Compound Annual Growth Rate. LEGO resellers/investors make up a very small percentage of LEGO buyers. You think there are a hoardes of them because you see a couple of hundred posting on LEGO forums, but they are the vocal minority, and have very little effect on TLG's business decisions.

    As for the STAR WARS LEGO theme, it is currently below average as an investment. There are many themes that outperform it. Most in fact. You are basing your feelings on a handful of extremely popular sets that appreciated very well. A LEGO set is worth what people are willing to pay. Look at it like Art. Why is one 100 year old painting worth 100 million, when other 100 year old paintings, just as rare, are worth $1000? These valuable sets are usually bought by adults with extra income, that maybe wanted a set earlier in life, but could not afford it then. Just like there are kids(and adults) now who want a Super Star Destroyer for $400 and can't afford it, but 10 years down the road, will have $800 to buy one because they really want it bad. I bought a 497 Galaxy Explorer several years ago for $350(tens times MSRP), not because I thought it was a good investment, but because I loved that set 30 years ago as a kid and wanted to build it again. These high priced sets are high priced because they a cool and creative sets, which people relate to and want and are willing to pay top dollar to have. Speculators have a much smaller effect on prices than you think. Just my opinion.

  • y2joshy2josh Member Posts: 2,002
    ^LotR, even as much as I'm not a huge fan of the sets (at least not in their initial incarnations) should still rise significantly in the aftermarket, simply because the theme doesn't have the legs to be a twenty-year license, so it's extremely unlikely you'll ever see a remake.

    As for Marvel/DC, it will be interesting to see which way they go with those. DC, I think similarly to LotR, doesn't have the legs to sustain itself without relying on tons of Batman rehashes, but Marvel could potentially have an insane variety of sets, and that's just within their top-caliber IPs.

    As to LotR being just as significant in twelve years as it is today... we'll see. I'm a huge fan of the books, and I like roughly two of the films well enough, but it's not exactly the merchandising juggernaut it was nine or ten years ago, nor was it a merchandising force at all before the movies came out. It could go either way, but I think in the short term, they'll do quite well.
  • evileddie1313evileddie1313 Member Posts: 126
    pharmjod said:

    I am doubtful that sets held onto for 10-15 years will on average be good investments. I grew up with Lego. I loved it as a kid. I have the means to do so, yet I do not pursue old sets from my childhood. I realize that in many / most cases the current production is simply better. Of course there are exceptions, but generally speaking, aside from nostalgia, I have no real interest in really old sets.

    Sure, some people will, but I have been buying, selling and collecting for over 10 years now. I can tell you I would mutch rather have a recent (last 2 years) retired set to sell in most cases vs a set from 10 years ago. Again, there are exceptions, but when you look at the lost investment of buying, selling and repeating the whole process, a single set held for 10-15 years with the intent of resale is a fairly poor investment choice. Just my $0.02 worth anyway.

    I agree with you. Keeping a LEGO set for 10, 15 or 20 years is not the best way to maximize your investment dollars. The best time to "flip" a LEGO set to maximize profit is about 2 to 4 years after EOL for a lot of sets. While there are late bloomers that see more growth later in life after retirement, most sets plateau at some point early on.
  • LegofanscottLegofanscott Member Posts: 622
    y2josh said:

    ^LotR, even as much as I'm not a huge fan of the sets (at least not in their initial incarnations) should still rise significantly in the aftermarket, simply because the theme doesn't have the legs to be a twenty-year license, so it's extremely unlikely you'll ever see a remake.

    As for Marvel/DC, it will be interesting to see which way they go with those. DC, I think similarly to LotR, doesn't have the legs to sustain itself without relying on tons of Batman rehashes, but Marvel could potentially have an insane variety of sets, and that's just within their top-caliber IPs.

    As to LotR being just as significant in twelve years as it is today... we'll see. I'm a huge fan of the books, and I like roughly two of the films well enough, but it's not exactly the merchandising juggernaut it was nine or ten years ago, nor was it a merchandising force at all before the movies came out. It could go either way, but I think in the short term, they'll do quite well.

    My gut instinct on what i think will be the best investment no matter how many are stockpiled is the haunted house, its one of the coolest looking Lego sets thats been released, im not sure why but its one of those sets that i can see still being hugely popular years after its EOL date, although that may be just because im a huge fan of the universal monsters and everything horror related :)
  • cloaked7cloaked7 Member Posts: 1,448
    ^ I like the HH too. It has several things going for it from an investment perspective. It's unique, it's a nice looking set, it has playability, it's generic enough to appeal to a lot of people and not just those who like comics, a movie, etc. And, it is a [email protected] exclusive, right? So, there won't be a lot of them bought and sold, relative to a set that is sold at Amazon, WM, Target, TRU.

    Course, the [email protected] exclusivity can work against an investor, because they probably won't find it at a BOGO sale, etc.

    Now, it's yet to be seen how long LEGO will run the set. Maybe it is current for 5+ years. We're seeing that with the Fire Brigade, Death Star, Apple Tree House, Luke's Landspeeder, and some other sets. Typically that would really hurt the later demand and probably will for most sets. But, since the HH is exclusive it may not be hurt much by a 5+ year run. If that happens.
  • SiESiE Member Posts: 238
    There are 50000 members on this forum and lego has been up as one of the best if not the best toy for decades. I dont see any bubble bursting for sets prior to 2013. Next year i will be wary of the sets i invest in. Exclusives only for me. There will be a market for sets for many years to come.
  • LegofanscottLegofanscott Member Posts: 622
    edited December 2012
    SiE said:

    There are 50000 members on this forum and lego has been up as one of the best if not the best toy for decades. I dont see any bubble bursting for sets prior to 2013. Next year i will be wary of the sets i invest in. Exclusives only for me. There will be a market for sets for many years to come.

    Exactly, however i just wish id took an interest in Lego that little bit sooner, how i would of loved to have bought a UCS Falcon and put it away only to see the price shoot up like it has done.

    The problem is everyone automatically thinks every current exclusive out at the minute will do exactly the same, and doesnt help when the only set mentioned in that video is 10179
  • monkeyhangermonkeyhanger Member Posts: 2,889
    Legofanscott: More likely if you were into Lego sooner, you'd have thought that £350/$399 was way too much for a lego set, sought one out in sales as it was going EOL and then built it. I don't think anyone foresaw that set going 5 x RRP MSIB. Plenty of people hoping for the same with 10212 and putting a few away, but even with the reassurance i'll double my money within a few years, I can't bring myself to drop £200 a piece on 2 or 4 of them and wait a few years to get my money back.
    pharmjodLegoboy
  • Rainstorm26Rainstorm26 Chicago Burbs USA (and sometimes Ireland)Member Posts: 1,004
    I bought a UCS falcon right at EOL for two reasons. It was on sale for $350. It was a cool looking set for $350. The reason I didn't open and build it was because my wife might have killed me initially for spending $350 on a Lego set, as I was not a reseller. Now that it is worth upwards of $2000, she has calmed down a little. But I don't know whether I am going to sell it or build it at this point. Actually most of my unopened sets are sets I want to build at some point, but didn't really want my wife to know about. So in the end all my sets may not be worth a whole lot because I didn't buy duplicates and I probably will build them, unless I really need money at some point in the future. So I think a lot of the comments here about speculators and the fact that most of the sets are "consumed" are probably right on the money.
  • mathewmathew Member Posts: 2,097
    ^ You can always build it, enjoy it for awhile and then sell it. I tell my wife that. I find the big sets are great for building and displaying, but after awhile they are just collecting dust. Also I'm afraid of parting them out because they are worth a lot more as a set (stupid collector side of me).
  • gmpirategmpirate Member Posts: 1,654
    Funny how our wives don't see all this Lego buying as anything else but messing around. In my wife's mind, it's not legit until the kitchen gets remodeled or we move into a bigger house. Just wait a couple years honey, and you'll see :P
  • gmpirategmpirate Member Posts: 1,654
    And actually, if she would just give the ok to move to Texas she could have it now.
  • mressinmressin Lego City... erm LondonMember Posts: 843
    ^ Try to "change the dynamic" [(TM), (C) 2012 @LegoFanTexas ;]. After I showed my partner my profit from reselling once, she's been very supportive.
  • monkeyhangermonkeyhanger Member Posts: 2,889
    My wife buys all kinds of crap that has no real retained value and yet frowns upon Lego purchases. At least with a bit of reselling I can make it so my purchases have cost me nowt in effect, although i'm not sure my wife completely believes me when I point this out.
  • richoricho Member Posts: 3,830

    ^ Yea, no kidding...

    I stopped at a few stores this morning, but not too many. The days of decent returns are over when LEGO investing and reselling ends up on the front page of USA Today.

    I mean really, do they need to hang a sign? :)

    Ahh, time to go find something else to buy and resell...

    So true! It's a bit like when companies market something as collectible, it's my immediate instinct to think its highly unlikely to be.

  • dr_tengdr_teng Member Posts: 101
    It depends. Sometimes when things like the USA Today article pop up, it causes a bubble from people flooding the market because they think it'll be easy profits. So resellers might get a nice bump in profits for a while. until that bubble bursts.

    If it even happens at all, it might have little to no effect beyond expanding the LEGO fanbase a bit.
  • gmpirategmpirate Member Posts: 1,654
    mressin said:

    ^ Try to "change the dynamic" [(TM), (C) 2012 @LegoFanTexas ;]. After I showed my partner my profit from reselling once, she's been very supportive.

    Lol, profits mean nothing. "Show me the money". Well dear, the money went back into buying more Lego :P
  • prevereprevere North of Bellville, East of Heartlake, South of Bricksburg, West of Ninjago City Member Posts: 2,886
    ^Yuppers. I keep repeating to my wife, "you gotta spend money to make money." And she keeps rolling her eyes.
  • nkx1nkx1 Member Posts: 719
    My wife is pretty supportive of buying/selling Lego. Sometimes I get busy with work and/or too lazy to sell some profitable sets we have in inventory, and she asks why we haven't sold such and such sets (she actually checks ebay here and there to see what we can sell). It's probably a good thing that she bugs me about it, because I might forget to sell them otherwise.

    Considering the small inventory we have compared to other people here (under $10k or so), reselling Lego isn't going to change our lives one way or the other. If the reselling aspect of Lego was no longer profitable, I wouldn't care much. Even so, it is fun making a few $ selling sets to minimize the cost of buying new sets for myself, so I'll enjoy it while I can.

    I would certainly hope no one here would "invest" more than they can afford to lose in Lego.
  • kwkwkwkw USAMember Posts: 1,176
    Easy solution to get your wife/gf into accepting your lego addiction, find a set she thinks looks cool, buy it for her and let (or make) her build it....you can thank me later lol
  • richoricho Member Posts: 3,830
    This might also mean that many current waves of sets and modulars are poor investments as well. Previous waves that are already eol are unlikely to be affected.
    UKtsumi
  • StyerStyer Huntington, WV, USAMember Posts: 73
    I'm just impressed that the word "Legos" didn't appear one time in the whole article.
    rocaoLegoboyFollowsClosely
  • LegoboyLegoboy 100km furtherMember Posts: 8,727
    @richo - This is how I see it.
  • richoricho Member Posts: 3,830
    edited January 2013
    Legoboy said:

    @richo - This is how I see it.

    Worth a 'like' surely then? :-D
  • FollowsCloselyFollowsClosely Member Posts: 949
    @evileddie1313,
    I signed up over at www.brickpicker.com a while back. The main thing that prevented me from sticking with it was the way you calculate change in value. Say I have two set, both valued at $500. I sell one, so I delete it and now I have one set on brickpicker. When I go to the dashboard is says my percentage change is -50%. or thoes of us with fluid inventory, the numbers are useless.

    Am I doing something wrong, or is this a "feature"?
  • prevereprevere North of Bellville, East of Heartlake, South of Bricksburg, West of Ninjago City Member Posts: 2,886
    I love to buy loose sets, incomplete sets, sealed sets, beat up boxed sets.

    So I just check completed listings on websites to find out the going rate. No need to do anything else.
  • Pitfall69Pitfall69 0 miles to Legoboy's houseMember Posts: 11,401
    edited January 2013
    ^Me too. I sell more of those than new sealed sets.

    It takes more time to make sure all the pieces are there for the loose sets, but I enjoy it, so it is ok.
  • evileddie1313evileddie1313 Member Posts: 126

    @evileddie1313,
    I signed up over at www.brickpicker.com a while back. The main thing that prevented me from sticking with it was the way you calculate change in value. Say I have two set, both valued at $500. I sell one, so I delete it and now I have one set on brickpicker. When I go to the dashboard is says my percentage change is -50%. or thoes of us with fluid inventory, the numbers are useless.

    Am I doing something wrong, or is this a "feature"?

    Hello. Well, this might not be the best place to discuss this, but I'll keep it brief. If your set inventory value dropped in half, what should it say? Maybe I'm misunderstanding the question. This is the second version of the Brickfolio and many major improvements were made, but there is still work to be done. More advanced options will be coming to give it a more spreadsheet like feel...if so desired(for those resellers out there). We want to be able to cater to the casual LEGO fan or the hardcore reseller. Please feel free to drop by the site and I can answer your questions with a little more specificity. Thanks.

  • enotogaenotoga Member Posts: 133
    Here in October 2014, the USA Today article hasn't been the death-knell we feared it might be. For whatever reason, the average Joe is not onboard with Lego investing and it may take a very long time for him/her to catch on.
  • juggles7juggles7 United StatesMember Posts: 452
    I disagree. The growth in the number of resellers is huge as evidenced by the offerings at Amazon and Ebay. Aside from a few exceptions, the $10-30 sets are impossible to make a profit on. It's only the more expensive retired sets whose markups exceed the fees and shipping costs that the reseller incurs. The large numbers of people using Fulfillment by Amazon is killing the aftermarket.

    But the "average joe"' is onboard. The average joe knows about Research Institute and would love to get his hands on one to... to resell of course! He's "just launched" at Amazon, has little or no feedback, and is shipping sets to Amazon for FBA, fulfillment by Amazon. At least on the smaller sets, his profit will be mere pennies on the dollar.

    From where I'm sitting, things are much worse than they were just 12 months ago.
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