Many casual firearm owners are stunned when they learn the price of fully automatic weapons. After this sticker shock wears off, the person begins to ask why. The answer is simple, supply and demand. No new machine guns may be brought to market, thus the supply is limited by those willing to sell used firearms. Naturally, demand grows as more people enjoy the shooting sports and as the country as a whole grows.
It does not take long for someone to ask the next question: Are machine guns a good investment?
Well, machine guns are certainly not a typical investment, but there is a whole asset class referred to as alternative investments. This loosely defined investment term would include everything from classic cars and baseball cards to machine guns. Anything that has the potential to grow in value is an investment if it is bought and cared for with that purpose.
A new-in-box machine gun, or one in very good condition, certainly has the potential to appreciate in value if properly cared for. However, a low grade example of a common firearm bought and used for shooting is unlikely to appreciate above and beyond inflation. (That being said, it is possible to replace any part of the firearm other than the receiver, and the receiver can be repaired. For this reason even a neglected shooter can be turned back into a pristine shooter, but this will not qualify the gun as all original.)
The single largest risk with machine guns as an asset class is political risk. In the unlikely scenario that congress allowed the sale of newly manufactured machine guns, or the Supreme Court found the ban unconstitutional, common examples would fall drastically in price. In a more likely scenario, if congress eliminated future transfers the cash value of machine guns would be nil. And in the most likely scenario, if congress raised the transfer tax on machine guns the resale value of the machine gun would be correspondingly lowered.
In the past couple of decades political risk has been quite low, but now that risk has grown by leaps and bounds. It is anyone’s guess regarding the short term outcome of that risk, and any investment in machine guns must be made with that risk in mind. We may know in a month or two what congress has done, or the issue may still be lingering about two or four years from now.
Should you decide to buy a machine gun, I suggest you do so because you enjoy shooting. Realize that this may be a final purchase and you may never have the chance to sell it. (If that truly bothers you financially, you can always sue the government on the grounds of an unconstitutional taking. This may get you money, but it may also cost you the firearm.) I would not purchase a machine gun solely as an investment, but would consider the holistic enjoyments of owning such a device and piece of history.
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