July 17, 2004
The Vintage Fender Stratocaster Market in Australia
The Fender Stratocaster is the one guitar that seems to evoke so much passion among collectors and players alike. Should I buy vintage or a reissue? Are three-bolts as good as a four-bolt? Do CBS Strats hold their value? One can only wonder where the market is heading in the twenty-first century.
As time marches on and 50s and 60s Strats become outpriced for the average player, I believe the term "vintage", and to what it applies, will change significantly. Despite the fact that a vintage dealer in Nashville may believe that 70s and 80s Strats are nothing more than good utility instruments, to many born in, say, 1980 or later, a vintage Strat may be anything manufactured before his or her date of birth. I’m starting to get young players asking for vintage Jackson guitars!
In Australia, we're at a slight disadvantage compared to the United States. Not only do we have to take into account our import taxes, shipping costs and GST (goods-and-service taxes), we also face fluctuations in the exchange rate between the United States dollar (USD) and the Australian dollar (AUD), which over the last year or so has gone from 1 AUD equalling .5 USD to .8 USD, and is now back to around 70 cents (as of July 15, 2004, 1 AUD is worth about .73 USD). What this means is that one US dollar costs us around $1.36 of our money (1 AUD being the equivalent of $1.36 USD and 1 USD equalling .73 AUD!).
Let's look at a typical example to see the impact this has.
A Stratocaster with a $12,000 USD market value that can be bought in the US for $10,000 USD, when brought to Australia will end up costing approximately $17,000 AUD, or $12,434 USD, after all applicable taxes and shipping costs - an amount greater than its market value.
Now, let's go back the other way and see where it takes us.
If someone from the States was interested in buying the same instrument that has a $12,000 USD market value and that cost the Australian dealer $17,000 AUD ($12,434 USD), the dealer would have to sell it at a loss to remain competitive with the market in the US. This essentially makes us uncompetitive in the US market with local US dealers unless we can buy instruments at a deep discount to their market value, or we invest in ultra-rare guitars that will bring a premium from knowledgeable buyers.
This fluctuating currency exchange rate affects the market to such an extent that it produces an overall slowing down of sales in general as our dollar gains, whereas, when our dollar is at 50 cents, bargains are to be found in Australia.
The market in general for high-quality vintage Strats is still small in Australia. We recently offered a 1962 Fiesta Red Strat in excellent condition through our shop and website. All of our enquiries came from the US and Europe. Australia has been so isolated from the vintage market that when Australian buyers see asking prices of $20,000 or $30,000 AUD they tend to shy away, not knowing or appreciating the real value of such vintage pieces and the costs to the dealer.
We can conclude that although Australia has had and still has quite a wide variety of players and collectors, at present the market here is still in its early days for high-end vintage pieces. But, having said that, bear in mind that we are a people who love things American and appreciate fine quality workmanship and great-sounding and -playing guitars. This will definitely lead to a greater vintage and high-end market as time goes by.
If I had $50,000 USD to invest in guitars where would I put it?
I would probably get something like what we just sold, a 1962 Fiesta Red Stratocaster, plus some early 70s strats, three-bolt and all! And maybe even a couple of late 60s thinline Teles for good measure. Why? Because they're already twice the age of the average band playing today! To these players vintage is 1970... or is it 1980?
About Ric Zand-Vliet and Rics Vintage Guitars
I started collecting the odd guitar in the mid eighties,* but at the time I never really looked at the "vintage" market as such. I used to pick up anything oddball - those old Ekos, Hofners and such, which were commonplace here in Oz.
At the time, there was no vintage market in Australia, and I remember passing on old Strats because I thought who would ever want one of those old guitars. How wrong I was and how times have changed.
It wasn’t until the Internet began and the occasional guitar website would pop up and a few friends travelling to the US brought back vintage-guitar magazines that I really saw what was going on elsewhere. These facts fuelled my desire to do more than sell the odd guitar at a flea market.
We started our website in 2002, and within a year of the site opening we saw a need to expand. The only way we saw this happening was with a bricks-and-mortar store. With the help of a generous benefactor (thanks, Rob), it became a reality, and before you know it we were not only selling to our local market but to interstate and overseas clients as well, which has helped us get to where we are today. We started business in Fremantle and to this day we are the only vintage guitar dealer in the Perth region. In only a year and a half, we have become Australia’s number one vintage-guitar dealer.
Being "the most isolated vintage guitar shop in the world" (Perth is the world's most isolated capital city) has some benefits - we see rare and collectible guitars and amps every now and then, such as the Fender LTD and the Fender Montego 2 pictured in this article, both currently offered by us.
Although we are a relatively small dealer compared to many in the US and Europe, we offer some very rare and interesting items, such as the elusive 1964 Daphne Blue Strat pictured above, which makes us worth keeping in your favourites list!
[Images from top to bottom: Ric Zand-Vliet with a 1971 Fender Montego 2 at Rics Vintage Guitars; 1964 Daphne Blue Stratocaster; closeup of the 1971 Fender Montego 2; Ric Zand-Vliet with a Fender LTD at Rics Vintage Guitars. All images courtesy of Ric Zand-Vliet and copyright 2004, Ric Zand-Vliet. All rights reserved.]
Contact Information
Contact: Ric Zand-Vliet
Company: Rics Vintage Guitars
Address: studio3 -13 James Street, Freemantle, West Australia
Telephone: Australia: (08) 9433-2625; International: +(618) 9433-2625
Email: ric@ricsvintageguitars.com
Website: www.ricsvintageguitars.com
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