Model Train Grading and Valuation Guidelines
Understanding Values and Condition
Below are the general factors that affect the estimation of a model train’s value, and you need to understand these factors well in best utilizing any Price Guide for your own situation. The Trainz Auctions values are based on actual historical item sales, and as more transactions occur in the Marketplace, our values will be updated.
A word about “price” vs. “value.” We define a “price” as a specific dollar amount, tied to a specific item and the offer of a seller to exchange that item for that amount of money. Therefore, only the seller of an item can set the “price.” A “value” is a much rougher estimation of the general price ranges that the market is bearing. The “value” can be used as a guide for “pricing,” but the two terms are not synonymous. As shown below, there are a number of factors sellers should use in setting their prices, with the “value” shown in the “Price Guide” only being one of these factors.
Before we review the factors of affecting the value of model trains, we need to summarize two important topics – terminology and condition.
Condition and Grading of Model Trains
We strongly recommend that collectors adhere to the Train Collectors Association (TCA) published grading standard definitions. These definitions are built into the "Condition" drop-down controls in Trainz Auctions. According to the TCA, "Condition and Grading Standards are subjective, at best, and are intended to act as a guide. Is is important and logical that wishful thinking now be allowed to influence the choice of grade."
- C-10 - Mint - Brand New: all original, unused and unblemished.
- C-9 - Factory - Brand New: all original, unused, may evidence factory rubs and the slightest evidence of handling, shipping and having been test run at the factory.
- C-8 - Like New - Complete:all original, no rust, no missing parts, may show effects of being on display and/or age, may have been run.
- C-7 - Excellent: all original: minute scratches and paint nicks; no rust and no missing parts; no distortion of component parts.
- C-6 - Very Good: Minor scratches and paint nicks, minor spots of surface rust, free of dents. May have minor parts replaced.
- C-5 - Good: Sign of play wear: scratches and minor paint loss. Small dents, minor surface rust. Evidence of heavy use.
- C-4 - Fair: Scratched, moderate paint loss, dented missing parts, surface rust. Evidence of heavy use.
- C-3 - Poor: Requires major body repair: Heavily scratched, major rust and missing parts. Restoration candidate.
- C-2 - Restoration required
- C-1 - Junk: parts value only.
All users are encouraged to review the complete TCA grading standards. These published standards also have guidelines useful for grading the packaging as well as restored/refinished items.
Main Factors Affecting Values
The definition of a model train item’s “value” to Trainz Auctions is relative to how much another collector would pay for that item. The biggest factors are of course supply and demand for the specific item itself. Rarity matters a lot. If the production run of the item was very limited or if the item was lightly collected at the time of its production, the value may be higher. Conversely, even if the supply is low, if the demand for an item is low, then so too will its value.
Other “Macro” Factors Affecting Model Train Values
- General Economic Conditions – As with most collectible items, the overall price of model trains has declined recently. We all hope that the world's general economic conditions improve, and we expect that if conditions improve, prices will rise with increased demand.
- Location – While not an obvious factor, the location of your items may impact their overall value. For example, items in major metropolitan areas will likely net a higher sales price due to the easier (and cheaper) access to more potential buyers than if you are located in a more remote part of the country or world.
- How It's Sold – There are several different ways to sell model trains, each with varying elements of cost, convenience and reach. The prices for model train items is typically different for these sales channels.
- Online – Due to the vast global reach of the Internet, the majority of collectible model trains is sold via online marketplaces, such as Trainz Auctions, eBay, Amazon, and others. Because all of the sellers virtually compete with each other even across these marketplaces and pricing is transparent, the online marketplaces tend to be more “market efficient” – meaning that the competition across sellers makes pricing competitive. Likewise, buyers like the convenience of having the items shipped to their doorstep. However, because shipping tends to be expensive relative to the overall cost of the items, the total price for an item bought online may be higher than one bought at retail. And because online sellers also need to compete with retail outlets, it puts even more price pressure on sellers in online marketplaces. Therefore, sellers online need to be very attentive to the costs of listing and selling in various marketplaces – there can be substantial differences. For example, Amazon is typically one of the most expensive marketplaces, charging more than 15% on the sale of a typical model train. Conversely, Trainz Auctions charges less than 8%. (eBay is between 12-15% typically.)
- Retail / Local – The total price paid for an model train is usually less when purchased locally. “Cash-and-carry” too is appealing because the buyer can assess the condition of the item he is purchasing by physically inspecting it, rather than relying on photos or written descriptions. However, the selection at retail outlets or shows is much more limited that with online marketplaces.
- Wholesale – Collectors can sell model trains to retail or online dealers at “wholesale” prices. While perhaps the most convenient and fastest way to sell model trains, the prices realized by selling wholesale can be substantially less than if the item is sold online or locally.
As discussed previously, the condition of your model train is a major determining factor of the pricing between two specific items. Items in their original packaging will often command a higher price too.
Of course, an often overlooked issue for collectors in assessing an item's value is simply being sure of the identification of what item they actually have. Without this knowledge, collectors may end up selling a rare variant item for the price of the common version of that item. Only by consulting comprehensive resources like our Catalog or having the advice of experts in that brand of item will collectors be able to be sure which item they actually have.
Sources of Model Train Pricing Information
Traditionally, expert collectors and publishers would compile books called Price Guides. These books served as both a good resource for collectors, but they also would give collectors a feel for the value of the different model trains. The printed guides are useful to collectors, since they are typically compiled by experts. However, the time it takes to compile, lay out, publish and distribute a printed book makes it challenging to remain complete and updated by the time of its publication. In addition, the printed guides have to limit the scope of the entire universe of model trains in order to create a guide of a manageable size. Some of the better-known printed price guides are the series of Greenberg's Guides for Lionel trains. David Doyle has also published several guides covering particular eras.
Increasingly, collectors have turned to online sources for values guidance for model trains. A commonly used tool for collectors is searching eBay’s “Completed Listings.” By looking at a number of actual sales, collectors can get a good perspective for an item's current market value. There are several problems with this approach nonetheless. First, it is a manual process. A good bit of the time in doing this research is to perfect your search query well enough to be sure you are looking at the right item. (See the issues above about Identification.) Additionally, there is very little information about the actual transactions you are looking at. For example, sometimes stock item photos are used, but the actual item purchased was a pristine boxed item. Often, little condition information is available, and there is no assurance that the seller even knew the correct name or criteria for assessing that item's condition. So, while eBay “Completed Listings” remains a good source for “spot-checking” the value of an item, it has inherent weaknesses and limitations.
The values guide has many advantages. Because each value is specifically associated with uniquely identified items (each of which typically have a photo(s), manufacturer, manufacturer number, year, UPC, series, or other useful data for positive identification), collectors can be assured they are looking up the “right” item. There are convenient links to the Marketplace where collectors can see the asking price of similar items.
Benefits of the Trainz Auctions Model Train Price Guide
The model train price guide is uniquely valuable for several reasons. It is a constantly-updated, consolidated price guide across many brands, gauges, and eras. And, it is integrated as an online resource for collectors.
Consolidated: We have seen that the majority of model train collectors collect a range of different types of items. By providing the most comprehensive and community-enabled catalog, the chances that all of a collector's items will be part of the system are very good.
If the price guides for the different types of items you collect were separated into different “silos”, the guidelines would undoubtedly be inconsistent.
Furthermore, if the values for the diverse set of items most collectors have are spread out across multiple sources or sites, aggregating this information across a collector’s full collection becomes inordinately difficult. Because Trainz Auctions has the so many values for the full spectrum of model trains (almost 100,000 represented now!), the members of Trainz Auctions can get interesting and useful reports such as their My Collection Report.
Online: This one’s pretty obvious. Given the scope, dynamics, and utility of having the values tied to a collector’s collection, printed price guides fail. With a searchable database of items too, online catalogs are more convenient than paging through a book or magazine. With the availability of this information on a mobile phone too, Trainz Auctions also provides the “access anywhere” benefits of printed guides.