SCROLL 1/2 PAGE TO APRIL RJ REPORT.
... this is here to stay based mainly upon the 30 years longevity of certified coins and cards. I really don't research all this, however I have read that certified coins and cards are much more highly valued than the non-certified items. Certainly this is true for comics. I look at the certification process as being "added value."
What about prices?
Prices are in the process of stabilizing right now as supply and demand forces catch up with each other. Prices tended to be a bit high up until this summer when the leveling off process began. It's likely that they will dip to a price lower than they should be for a short period before rising a bit and then leveling off from there. The big demand and tiny supply accounted for prices up to now. Next step is for the market to be over supplied fueled by ambitious dealers.
It is a good thing that CGC cannot keep up with the demand and seems able to place a thousand or so comics into the market place a week. Imagine that CGC was suddenly able to flood 10,000 comics a week into the marketplace. Prices would drop with the over supply as dealers tend to make their wares available immediately without much thought about the consequences.
It's possible that the recession could affect prices, however it's not likely to affect prices more than 10%. During true recessions and stock market crashes, collectibles generally do very well as those stung in other markets turn to tangible items. A certified comic is a good investment for these individuals as they really don't understand how comics are graded and valued, and can participate by simply making a purchase of most any CGC comic at fair market value. The plastic case insures that the item will not be mishandled and the condition will not change while in the care of an inexperienced collector. In the event that many novice collectors entered the scene, the added demand would actually help to stabilize the comic marketplace.
The eBay scene.
Back Issue Comix began penny auctions with no reserve in December of 2000. Demand was strong and every item was sold a at a fair price. As supply and demand caught up to each other the penny auctions no longer worked as a customer willing to pay the fair market price was not always shopping. Bargain hunters could simply pick up an item at lower prices and resell it to another.
At this moment, Back Issue Comix offers various starting, reserves, and buyout prices that would appeal to a real buyer. The bargain hunter can still find a bargain, however it cannot be "stolen" simply because a real buyer was not in the market place. Very often an item which finds no interest one week will find serious buyers the next time out.
We note that other sellers are now operating in a similar manner. I'll discuss the economics of the $15 certification fee in detail here soon. Bottom line is that any CGC comic must sell for $27.00 minimum in order for a dealer to stay in business. Collectors looking to make purchases under this price will soon be out of luck as as the dealers who sell CGC comics at these prices will be out of business. Any comic sold under this price is a loss to the seller who must consider the comic a distress item which must be unloaded in order to reinvest in profitable inventory.
That's all for now. Check in here often for market updates.
APRIL 2002 UPDATE:
Certified comics have been steadily rising
for the 9.6 and up grades since the 1st of the year.
9.6 X 5 X 6
9.8 X 9 X16
9.9 X 15 X49
It's apparent that history is repeating itself ( Overstreet in the 80'S with good and mint ratios) with an ever widening gap between 9.6 and 9.8 and 9.9 . 9.6 seems to be a fairly stable benchmark and from there 9.8 and up grades are climbing as collector's scramble to obtain these gems for their collections. 9.8 seems headed toward X 18 or three times the 9.6 prices. Will it stop there? Another possible point would be X 25 as that would be one-half of 9.9 prices.
Bear in mind that age of a comic is a factor in determining fair prices prices. Most would agree that a 9.9 for a 70's comic would probably be worth more than a 80 or 90's issue.
A trend I see at eBay is that there is a large group that will pay $15 or $30 for a CGC book without much regard for the CGC grade. If the book is a rare 70's one-of-a-kind book valued around $100 , all bidding stops abruptly at $30 when the title is lightly traded. True buyers are not present so the book either is held back in reserve or the unlucky seller loses his investment. This same group would pay $30 for the book if it were 9.2. This group of collectors simply has a $30 limit an nearly every comic.
When a comic is "stolen" from a naive collector in this manner, some perceive this as the new price at which the comic should be traded! The unfortunate part of this is that many collectors have a book certified simply because they want to sell it and instead of determining a fair market value and setting a reserve , they list it thinking it will settle a fair price.
What can one do to keep from being beaten up in the auction market? Look at listings. You'll see the same book being sold on the same day for half the price of another. One collector set a price , or reserve at which it could be sold and received double the seller who didn't protect himself .
Part of this trend is the one bid auction. A year ago most CGC auctions had 6-12 bids. Now 6-12 bids often means that the opening price was very low and scavenger buyers bid the item up in 25 cent installments. The smart seller sets his price , gets one or two fair bids and makes the sale.
Nothing is wrong with bargains at auction. In fact that is why many are shopping there. A seller wants quick cash and is willing to settle for 1/3 or 1/2 fair market price and knows a buyer will be found. Dealers and pro collectors can't do this however, and need to sell their wares in the same arena as the amateur. Buyers should realize that some comics simply will not be available from amateurs and to build a respectable collection will require purchases from professional sellers who know how to obtain and market collectibles.
Strategies are changing in the auction market each month. If you are aware of trends and patterns, please write and we can print it here. RJ