Vintage Treasure: How to Build Your Guitar Collection

This year, the late Nirvana frontman Kurt Cobain’s Fender Mustang guitar, played in the Smells Like Teen Spirit video, fetched $4,550,000 at auction. On its launch in 1964, you could have picked one up for $189.50. Two years earlier, the Martin D-18E acoustic model used in the band’s MTV Unplugged special became the world’s most expensive guitar, selling for $6,010,000.

Prior celebrity ownership with forensically authentic provenance from the collections of an Eric Clapton, Dave Gilmour or Bob Dylan will always guarantee a safe investment in today’s guitar market, but, as one-offs, they’re hard to track down.

Good vintage guitars are 100 percent a credible investment, if for no other reason than they’re not making them any more. If you’re looking at Fenders, Telecasters, and Stratocasters from the ’50s and ’60s are the golden tickets—Joseph Overlock

So, since this is a market that has seen values soar since it began in the 1980s, what are your chances of finding a vintage guitar with investment potential?

In the late ’70s, I spotted a Gibson Les Paul in the dusty corner of a bric-a-brac store in Mendocino, California, and knew from the serial number it was a 1959 model, now the holy grail of Les Pauls made famous by the original Fleetwood Mac’s Peter Green. Priced at a few hundred dollars, which I didn’t have at the time, this would be worth somewhere around $360,000,00 today.

Green’s original Les Paul is now owned by Metallica’s Kirk Hammett, who paid a reported $2 million. Les Pauls never had much currency until John Mayall and the Bluesbreakers’ famed Beano album featured a tiny picture of Eric Clapton playing one on the back cover. After that, everyone wanted one.

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“This is a good indicator,” says Alan Greenwood, founder and publisher of Vintage Guitar magazine. “Watch what your heroes are playing. In the ’60s, Harmony H73s were cheap guitars shipped in their thousands to Sears stores, but when The White Stripes’ Jack White came on stage with one, that model’s currency increased overnight.

“If I was given $100,000 to buy an ‘investment’ guitar, I would look for the oldest I could find in its closest-to-original condition. For electrics, your safest bets will always be Gibsons and Fenders. If you’re going the acoustic route, Martins from the ’20s to ’40s are the ones to go for.

“Factors such as the intensity of the finish on the bodywork will also affect the price, particularly with Les Pauls, where the Sunburst and Flame designs can range from barely there to strikingly bold. And always remember the original finish, however distressed it may look, will always be more valuable than a refinish.”

Diligence is a key factor, adds Greenwood. “Counterfeits are rife once you get into the higher price ranges, so do take the guitar you’re thinking of buying to a blue-chip auction house that has a guitar expert in-house, or a reputable dealer. The cardinal rule is, as always, buyer beware. And you need patience. It may take 20 years for your chosen guitar to see a significant increase in value.”

The devil’s in the details, according to U.S.-based rock memorabilia collector Joseph Overlock, who stresses the importance of doing your homework on any particular model. Know where and what all the original fittings and signage should be, and the correct dimensions.

“If I was to invest serious money in a vintage guitar, I would only go to a private dealer, telling them I had a significant amount of cash to put into an investment-value guitar. I’d also put the word out among private collectors,” he says. “Big-name guitars are safest, but there are always exceptions. The one Elvis played on his ’68 TV Comeback Special was a no-name guitar. Last year, it sold for $268,000.” Auction houses such as Christie’s also offer a private sales service.

One person who knows the vintage guitar business is legendary blues-rock guitarist Joe Bonamassa, who curates his collection of some 400 vintage guitars and an equal number of classic amplifiers at Nerdville East, his Nashville shrine to the six-stringed instrument. “The best tip for people buying guitars is knowledge,” he told Guitarist magazine. “And buy what you like. Always just stick with what you love.

“I’ve never been conned by a fake because I know what I’m looking at. Before I get the chequebook out I know what I’m looking at, and if I don’t know what I’m looking at, I’m not too proud to ask somebody. The people who get swindled are the ones going, ‘Oh my God, can you believe the deal I’m getting?’”

One of Bonamassa’s go-to sources is Norman’s Rare Guitars, of Tarzana, Los Angeles, whose buyer Jack Sullivan is in no doubt about classic guitars as investments. “Good vintage guitars are 100 percent a credible investment, if for no other reason than they’re not making them any more,” he says. “If you’re looking at Fenders, Telecasters, and Stratocasters from the ’50s and ’60s, they are the golden tickets. Famous players’ signature models can’t be dismissed, either. At some point Fender will stop making a Jeff Beck signature Strat and that’s when those guitars will become more valuable.

“If you’re choosing a Gibson, Les Pauls and ES-335s are the heavy hitters, with SGs, Flying Vs, Explorers, and Firebirds being more affordable choices. But no one knows how valuable a guitar will become when it starts being produced. If you’re spending a large amount on a vintage guitar, insist the vendor gives you at least 48 hours to have it checked out by a reputable expert who’ll take the whole thing to pieces for inspection and furnish you with a full appraisal report. This should cost about $150, which, if you’re planning on spending thousands, should be a no-brainer.”

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His top pick?  A ’54 Fender Telecaster Blackguard, currently listed at up to $50,000 or a Gibson Banner acoustic, largely crafted by women during the Second World War, which should set you back around the $12,000 mark.

Walter Carter, a veteran guitar authority who opened his eponymous Nashville store in 2012, is slightly more pragmatic. “One day, someone will realise an electric guitar is nothing much more than a painted plank. To my mind an acoustic is a more interesting choice, since, unlike an electric, these will improve in tone and therefore value.

“Even if a guitar is thoroughly beaten up and showing signs of abuse, it can still fetch a premium price. If you’re after a Martin acoustic, look for models from their golden era from the late ’20s to the early ’30s, which will go for anywhere from $10 to 500,000. “Ultimately, we dealers are like stockbrokers—if we really knew what we were talking about we wouldn’t be here selling guitars right now!”