Militaria: The investment you never thought of…
Most sophisticated investors are aware of the fact that “collectibles” have always been a good hedge against inflation and have proven to be a good investment in terms of capital gain. When they think of collectibles, the usual antiques, stamps, coins, art, etc., easily come to mind. However, very few think of “militaria”.
What is the militaria? It’s not even in my Webster, so I’ll define it myself. Basically, it’s any type of military or paramilitary collectible. It can range from weapons, uniforms, medals, badges, badges, field gear, etc. If it’s of military origin and people collect it, it’s militaria.
There’s someone out there who collects everything you can think of. If you searched hard enough, I’m sure you would find someone who collects and wants to buy Argentine army combat boots. But I don’t think it’s a very good investment…
The regions, or countries, most popular with collectors are the United States, Great Britain, France, Japan and Germany. Although one can find collectors interested in all countries and all time periods, perhaps the most popular period is World War II. Because this article is about investing, I’m going to focus on the area that has proven to be the best investment over the long term. Fortunately, this is the area I have collected for over 35 years…Germany of the Third Reich.
Even before the shooting stopped in Europe, GIs were “liberating” memories of German prisoners and battlefields. Soon after, a vibrant commerce developed between the soldiers as they traded items, not really knowing what they had or what they were doing, and basing their exchanges on the purely personal appeal of ‘an object. For a few years after the war, these memorabilia were sought after by a few “hardcore” collectors. They appreciated the historical significance and artistic qualities of the relics. Yes, the full uniform of a “Nazi” officer can be magnificent!
It was in the 1960s that the hobby really “took off”. What contributed most to its growing popularity was that it was around this time that reference material began to become available. Prior to this, there was very little information available to collectors. Reference books meant that a part could be identified exactly what it was. The “old German jacket” was now a panzer captain’s parade tunic” and the “swastika brooch” was now a gold NSDAP member lapel pin.
Now that collectors had an idea of what they really had, they were able to start assigning realistic values to their items. No one would trade a 2nd class Iron Cross (made to millions) for a rare army general’s costume dagger anymore. The hobby was getting organized.
In the 1960s there were a number of “merchants” who bought and sold German militaria on a part-time or, in some cases, full-time basis. Interest grew as more and more people (mainly men) realized what a fascinating hobby it was. As interest increased, demand increased, and as demand increased, prices increased. There was a steady increase in prices for the next 30 years.
A full history of the hobby is beyond the scope of this article, so I’ll skip ahead. It’s now 2007 and asking prices for German militaria have skyrocketed! I would estimate that over the past 5 years most German militaria have increased in value by 500%, and in some cases even more. Still, collectors can’t get enough of them and prices keep climbing higher and higher with no end in sight. Certain areas of the hobby have always been more popular than others. Among these are the daggers, of which there are more varieties and variations than you can imagine, and the SS. I say; the bad SS! Let’s face it, the bad guys are always more interesting than the good guys. After all, which would you rather own, the outfit worn by Luke Skywalker or the one worn by Darth Vader?
So what does this mean for you as a potential investor? It could mean big profits in the long run. A rare medal, dagger or uniform bought today for $5,000 could be worth $25,000 in a few years. That is, or of course, if things continue as they are. Unlike the stock market, the German militaria “never” loses value. I rely on many years in the hobby and on personal experience. At worst, the increase will slow for a while, but prices will still continue to rise.
I’m not suggesting that you rush out to buy “Nazi stuff” at the local flea market. On the contrary, caution is required in this area, as in any investment. There are a few “beginner” pitfalls in our hobby.
Unfortunately, as the value of collectibles has increased, so have the number and quality of counterfeits or reproductions. Spending a lot of money on one of these as an investment could prove disastrous. Be careful! Here are some suggestions for an investor with limited knowledge of our hobby.
1. Buy quality. Do not buy parts in poor condition. And don’t buy inferior parts. It would be better to buy a really good item rather than a pile of junk.
2. Purchase from a reputable dealer. This will require some homework on your part, but it will pay off in the long run. The internet is full of dealers, some good and some not so good. Check them out before dealing with them. Another place to find dealers is at “militaria shows” and gun shows. There are also several auctions on the Internet. Again, be careful who you are dealing with.
3. You may want to hire an experienced collector to advise you. Make sure it’s someone who has no financial interest in your eventual purchase.
4. Be prepared to hold your investment for a while. Don’t expect to buy it one day and resell it the next with a profit.
I can’t guarantee that you will cause a massacre by investing in the militaria of the Third Reich… no one can. However, if you buy quality pieces at a fair price and keep them for a while, you should be fine!
This article was written to acquaint potential investors and collectors with the hobby of collecting German militaria. The author does not believe in or support the ideals represented by these collectibles.