Will a recession tank game prices?

[OptOut | 8,892]

I think demand for your run-of-the-mill regular loose cart and CIB is going to remain pretty strong for the foreseeable future. I can't see more than maybe a cooling of prices for these sorts of normal Joe style games, probably back to early 2020 levels before the covid free money, or maybe a little higher than that baseline, before the ridiculous spike. Obviously those games that spiked harder will also likely cool off quicker, I'm looking at YOU loose Pokémon!

As for sealed games? Heh he he... There's gonna be blood for sure! 

[PuppyWaffles | 1,853]

Short answer is no.

Back in the last recession I used to flip Lego sets. When everyone lost their jobs and houses is when I had my best months in sales. People can't afford to go out and spend money on things, so they buy things they can "do at home". Video game prices didn't go down then. 

This time it could honestly be worse. A lot of the other millennials I work with my age don't own houses or have their cars paid off and are in serious debt. I've heard a few of them say if they start not being able to afford things they would max out a few credit cards in collectables, file bankruptcy since they don't own anything, then sell the stuff when it's worth money. Extremely stupid idea, but these are the same people that bought GME and Doge and keep saying they won't make student debt payments. A lot of my friends hear the same things at their jobs...so as long as people are buying and holding on to stuff the market will increase regardless of the economy. Just my hot take.  

Edited June 18, 2022 by PuppyWaffles

[_Brink_ | 48]

Cars, Art, Coins, Sportcards, Comics and pretty much all collectible markets will have a downturn at some point - its healthy and normal.  Most of us dont remember or didnt live through the mid 70's / early 80's or true hardship times earlier than that, so its hard to imagine prices plummeting - similar to stocks & crypto right now. 

[T-Pac | 7,587]

Game prices tanking? 

Hmmm ... I dunno. Maybe you should all give me your space-shooters and Atari carts now just in case...

-CasualCart

[Goodvibes | 159]

22 hours ago, MrWunderful said:

How much food, water and bullets can I get for a cart+manual adventures of Rad gravity?

 

 

Now if it was cib and something I don’t already have we would be talking! What else you got? Lmao

I hear lots of people talking about the prices coming down, I hope so but I don’t see any of that happening right now, doubtful down the road either.

[RegularGuyGamer | 2,017]

Not tank but it will put don't stain on it. The reality is a lot of people getting into the collectable market were speculating similar to how they were with stocks and crypto. The only way it'll actually go down is if people decide to sell all at once. I don't think that'll happen though. More likely people is games will plateau and in a few instances have some downward pressure mostly from completed auction sales. 

[phart010 | 1,708]

One of possible catalysts for a downward inflection is market anticipation. If investors think that the market will go down in the foreseeable future, they may decide to sell their investments to get out ahead of everyone else. Those that start selling early will dump excess supply into the market driving the prices down. This downward pricing action will scare other investors who may think they are gonna take a hit when the market tanks so they panic sell and the dominoes start falling.
 

The anticipation of the event becomes the catalyst that initiates the event. Self fulfilling prophecy.

This type of phenomenon would happen with sealed graded games. It would not happen with regular games though, because too many regular non-investor /collector people buy regular games and are not too fazed by the pricing action. 

Edited June 19, 2022 by phart010

[RegularGuyGamer | 2,017]

2 hours ago, phart010 said:

One of possible catalysts for a downward inflection is market anticipation. If investors think that the market will go down in the foreseeable future, they may decide to sell their investments to get out ahead of everyone else. Those that start selling early will dump excess supply into the market driving the prices down. This downward pricing action will scare other investors who may think they are gonna take a hit when the market tanks so they panic sell and the dominoes start falling.
 

The anticipation of the event becomes the catalyst that initiates the event. Self fulfilling prophecy.

This type of phenomenon would happen with sealed graded games. It would not happen with regular games though, because too many regular non-investor /collector people buy regular games and are not too fazed by the pricing action. 

Why I think this would only apply to sealed and graded is because generally people don't check the prices of their games, especially for large collections. The people who go sealed and graded are typically tuned into the market and prices so they might feel the panic.

I can see a lot of people holding the bag though honestly. Bc it's not stocks or crypto it's the ol' red plumber or w.e their favorite game is. That's kinda why prices never really fell off in the first place. The connection the average gamer / collector has with the games they have, sealed & graded especially, is just stronger than that to a company or a crypto currency. 

[LutherDestroysTheGond | 690]

Who knows.  I'm hoping prices dip so I can more easily pick up the games I want

[Tanooki | 4,952]

See I think that whole reverse FOMO way of thinking of it phart said has more reality to it.  We need to detach ourselves from caring about the games and what they mean to us.  Be the investor who caused this very problem, then think of it like an economist about risk vs reward.  The investors tend to get nervous when stuff doesn't start selling as fast, then as well, even a slight bend downward that doesn't correct in another month or two will cause them alarm.  At that point their end game of risk vs reward will kick in.  A lot of those greedy cranks didn't get the deals we got from a decade ago and further back, they ate it in increasing amounts knowing they could turn over stuff in bigger numbers with a narrower margin because quantity beats out a quality sale when more smaller bites adds up to more than one hopeful big hit.

When they check their numbers and see that copy of let's say EVO they bought at $275 which topped out around $300-320 is now back to $270 or maybe sustaining now for a month or two around $250 they'll get itchy.  Is it worth losing $25 and getting out, or do I wait and hope it pops back up?  Or do I sit and accept I could lose a $100 on this game?

That's the crap that will go through their head, not nostalgia, not gamer love, not the appreciation for what it is even as a good game now than it was decades ago.  It's about the money, all about the money.  The more they see the margins narrow or fall flat (or worse under) they get into that point where they say... fuck it.  Bail.  They'll see of their whole room of stuff to roll (or warehouse) they could still eek out a small margin and not loose will look far better than losing $5000, $10000, more?!  That's when the shit will hit the fan.  It won't be all at once, it'll be a few smarter ones getting out before it gets worse (even or loss), and others who will then see these drops then think...do I hope it fixes itself or do I eat it?  It'll snowball, it's just a matter of when.

[inasuma | 1,203]

On 6/17/2022 at 4:16 PM, DefaultGen said:

Covid crashes the market and games went way up. Then the market recovered games went way up. The only explanation is that games always go way up.

There is no other valid explanation. Thread can be closed now I think?? /s

[Brickman | 4,013]

Should have put a poll as well to see if people would sell their own collection if they lost their job. I think a lot would have said no.

I’m sure there might be some dips, but overall as long as there are more buyers vs sellers the prices won’t move much. There are a lot of people who would jump on an item if it dropped a lot. Especially in good condition.

Sealed market might be different though, that seems more based on financial gains than collecting.

[Tabonga | 2,337]

On 6/17/2022 at 3:16 PM, DefaultGen said:

Covid crashes the market and games went way up. Then the market recovered games went way up. The only explanation is that games always go way up.

Here's the money - where is that copy of SNES Tetris?

[LeatherRebel5150 | 1,056]

7 hours ago, LutherDestroysTheGond said:

Who knows.  I'm hoping prices dip so I can more easily pick up the games I want

There it is.

1 hour ago, Brickman said:

I’m sure there might be some dips, but overall as long as there are more buyers vs sellers the prices won’t move much. There are a lot of people who would jump on an item if it dropped a lot. Especially in good condition.

Exactly what I was talking about somewhere earlier in this thread. There are way too many people waiting for a dip to “pick up the games I want” As long as that condition exists the prices won’t drop in any significant way. Because the risk/reward/fomo on the buyer side kicks in. 

A game drops by 10-15% and a bunch of buyers think “sweet deal” and hit the buy it now button, generating more sales, pushing the price right back up again. Generally people are not disciplined enough to hold out for prices to really come down, it will only take a few percentage points for people to feel like they “won” in the purchasing game.

You know when prices will really come down? When someone makes a thread like this and no one responds, because they just don’t care about the games/prices anymore. Or they respond with something like “It doesn’t matter if prices go up/down because Im done buying.”

[Tanooki | 4,952]

What one may say vs what they'll do is another matter.  I call bs on people not selling off the collection or a large part of it is the money dries up being out of work and out of unemployment checks.  It's why I started creating per system 'top' lists to just not dump and then over a year 80% or so of a collection into thousands a pieces went up in smoke back in 2005.

You say you won't, but when you're fucked, unless you're planning to build a home out of used game cartridges and using the boxes and manuals to make a fluffy couch or mattress and sheets I'm not buying that story it won't get reduced or lost entirely.

[Brickman | 4,013]

6 hours ago, Tanooki said:

What one may say vs what they'll do is another matter.  I call bs on people not selling off the collection or a large part of it is the money dries up being out of work and out of unemployment checks.  It's why I started creating per system 'top' lists to just not dump and then over a year 80% or so of a collection into thousands a pieces went up in smoke back in 2005.

You say you won't, but when you're fucked, unless you're planning to build a home out of used game cartridges and using the boxes and manuals to make a fluffy couch or mattress and sheets I'm not buying that story it won't get reduced or lost entirely.

Yeah but not everyone is living pay cheque to pay cheque. Some people have huge buffers before they have to think about selling stuff.

Obviously there will be people who will need to sell but not everyone is going to lose their job, so as long as there are more collectors with jobs vs those without the prices will barely move. 

We also don’t know what type of recession might happen. During the 08 recession the US was screwed over but my country didn’t even have one and in fact we were flying and bounced right back.

Game collecting is a global thing not just a US thing so there will always be someone in a country doing it better to pickup the slack. 

I think LeatherRebel said it best. The day someone makes one of these posts and no one responds is probably when you know it’s over.

Other collectibles have gone through recessions and are still going stronger than ever.

[RegularGuyGamer | 2,017]

One of the issues with games as investments is that liquidating them actually sucks. The first part is the obvious listing, packaging, shipping and dealing with the customers who often are the salt of the Earth. Then you're paying 15% of sales under 1k and 6.5% on sales from 1-7k.  Now you're paying income tax on these sales too. 

Games basically lose value the second you purchase them and they need to go up quite a bit to even break even.  For a $250 game, you're looking at clearing essentially $200. 

If a person wanted to make money on video games, they wouldn't do what we do and buy 1000 games averaging $50 each. They would buy 10 games averaging $5,000 each, or more honestly. Those are the people moving the market. The rest of us are perfectly fine holding the bag as prices fall (if they ever would)

[MrWunderful | 2,927]

What about that people that see that the market is “crashing” and say,

 

”fuck it. If they are worthless, ill just keep ‘em!”

 

I just wanna say, for the record that if you are broke and need to sell video games to make ends meet if you miss a paycheck or two you got no business collecting games in the first place. Worry about your rent and car payment first. 

[Andy_Bogomil | 815]

25 minutes ago, RegularGuyGamer said:

One of the issues with games as investments is that liquidating them actually sucks. The first part is the obvious listing, packaging, shipping and dealing with the customers who often are the salt of the Earth. Then you're paying 15% of sales under 1k and 6.5% on sales from 1-7k.  Now you're paying income tax on these sales too. 

Games basically lose value the second you purchase them and they need to go up quite a bit to even break even.  For a $250 game, you're looking at clearing essentially $200. 

If a person wanted to make money on video games, they wouldn't do what we do and buy 1000 games averaging $50 each. They would buy 10 games averaging $5,000 each, or more honestly. Those are the people moving the market. The rest of us are perfectly fine holding the bag as prices fall (if they ever would)

Even someone who bought the bulk of their collection more than 8-10 years ago, I still feel this. Between the time, cost, and general effort to sell, it's a real pain in the ass and you eat a ton of profit with shipping, tax, and fees now more than ever. I feel the same about stocks too... did a bit of research and made some decent trades last year, but between the fees and tax and the effort put in, it really doesn't seem worth it unless you're playing the long game or you take significant risk (unless you just generally enjoy it). In both cases I just feel like I am getting fleeced (by eBay with selling games) but particularly the gov't since they take a significant amount for doing nothing.

I still have quite a bit of stuff to move and taking a hit and selling in a few bulk lots seems more appealing by the day.

 

 

Edited June 21, 2022 by Andy_Bogomil

[Tanooki | 4,952]

24 minutes ago, Andy_Bogomil said:

Even someone who bought the bulk of their collection more than 8-10 years ago, I still feel this. Between the time, cost, and general effort to sell, it's a real pain in the ass and you eat a ton of profit with shipping, tax, and fees now more than ever. I feel the same about stocks too... did a bit of research and made some decent trades last year, but between the fees and tax and the effort put in, it really doesn't seem worth it unless you're playing the long game or you take significant risk (unless you just generally enjoy it). In both cases I just feel like I am getting fleeced (by eBay with selling games) but particularly the gov't since they take a significant amount for doing nothing.

I still have quite a bit of stuff to move and taking a hit and selling in a few bulk lots seems more appealing by the day.

 

 

That's where I am, or in the under a decade span I got the stuff cheap enough even with all the thieving like abuses of ebay and the do-nothing for it third time taxation of the us government on it now this year I could still minimally break even.  It would be far worse if I had to use ebay and go that route.  As it is now I see the writing on the wall, and doubt it'll go back so I'm comfy dropping the stuff for 50-60% of the value locally at that shop I brought up enough because it's in and out in 30min or less more or less, and the headache barrier of all the long game bs of selling(process, packing, shipping, etc) is negated.  That's how I'm dealing with the stuff left to move you're seeing maybe appealing in bulk.

What I largely have left now is long game, games I've had pre-2010 for systems that dated, so I can come out ahead, but knowing how garbage is now I'm largely dumping what I see myself not caring about nor having nostalgia enough for (snes and before stuff) to care just letting get dusty now.

[OptOut | 8,892]

If you have a significant percentage of your wealth tied up in videogames, you must have either an incredibly impressive and unusually valuable collection, or alternatively not much going on outside of that.

I'd say that for the majority of people, neither is the case, for most people I'd be surprised if their collection comprised even 5-10% of their networth. Videogames, in general, are STILL a cheap hobby compared to so many other things people spend their time doing.

Think of the sort of money people into cars or bikes spend on buying and maintenance, or people going on vacations, weekend breaks and restaurants, or things like hunting, fishing or going to watch sports or concerts. Those hobbies can easily rack up into the thousands or even tens of thousands per year.

You can still buy PLENTY of decent games for under ten bux a pop, depending on what you're after, if you extend that a little to under MSRP, the VAST majority of games remain under MSRP.

So yeah there's a reason why videogames have a reputation for being a recession proof industry, it because it's a CHEAPER alternative to actually going out and having a life! Videogames are literally the opiate of the masses.

The only people who ACTUALLY have to worry are the dudes who spent 200 grand on a copy of Smash Bros 64 or whatever. They fukd.

[jonebone | 1,307]

Short answer, no it will not "tank" game prices.  It'll cause buyers to be a lot more selective with their purchases and prioritize better, but that's already been happening since summer of last year with the Heritage peak (speaking to graded items specifically).  We're also in the summer lull season too so most are only buying the stuff they really can't pass on.

People are fleeing stocks and crypto into cash or more safe investments like bonds and metals, but collectibles are in a category that falls in the middle.  More speculative than the safe stuff but also more tangible than stocks and crypto. 

Stocks are bought with one purpose only, with the intention of being resold one day at a profit. Crypto is mostly speculative but can be argued that it is bought with the intention of being spent, different from a stock which must be liquidated first.  Collectibles can be bought for keeps.  People incorrectly assume that just because something is expensive that it is bought with the intention of profit.  That may be true for some but I deal with plenty of collectors that are black holes.  You sell them something, no matter what the price, that thing is never coming back to market unless next of kin inherit it and let it go.

So prices can fall but there is also an invisible floor to where people start buying.  Each person is different but a recession is not a depression either.  Some new speculators will get shaken out (though most already have been after the HA bubble popped) but the decade long collectors aren't going anywhere.  

[phart010 | 1,708]

12 minutes ago, jonebone said:

Short answer, no it will not "tank" game prices.  It'll cause buyers to be a lot more selective with their purchases and prioritize better, but that's already been happening since summer of last year with the Heritage peak (speaking to graded items specifically).  We're also in the summer lull season too so most are only buying the stuff they really can't pass on.

People are fleeing stocks and crypto into cash or more safe investments like bonds and metals, but collectibles are in a category that falls in the middle.  More speculative than the safe stuff but also more tangible than stocks and crypto. 

Stocks are bought with one purpose only, with the intention of being resold one day at a profit. Crypto is mostly speculative but can be argued that it is bought with the intention of being spent, different from a stock which must be liquidated first.  Collectibles can be bought for keeps.  People incorrectly assume that just because something is expensive that it is bought with the intention of profit.  That may be true for some but I deal with plenty of collectors that are black holes.  You sell them something, no matter what the price, that thing is never coming back to market unless next of kin inherit it and let it go.

So prices can fall but there is also an invisible floor to where people start buying.  Each person is different but a recession is not a depression either.  Some new speculators will get shaken out (though most already have been after the HA bubble popped) but the decade long collectors aren't going anywhere.  

I hear all of what your saying and agree with many points made.

But (with all due respect), as a collector of high value items, your opinion is one with conflict of interest  

[O.G. CIB | 415]

50 minutes ago, phart010 said:

I hear all of what your saying and agree with many points made.

But (with all due respect), as a collector of high value items, your opinion is one with conflict of interest  

I agree with the conflict of interest but any collector that has knowledge of the market is going to have a conflict of interest when there is value attached to it which is pretty much 95% of us. 
 

To me it boils down to when you got in the market and what you collect. If you got into the market 10 years ago swings are not going to matter much. If you collect sealed/graded games in the last 2-3 years they already have started to take a downward trend, do you hold or do you bail. If you’re a loose cart collector you maybe able to jump on items that newer collectors decided they don’t want anymore. It’s so hard to judge and in all honesty these talks have been going on for the last 20 years I have collected. I bought sealed games when they were dirt cheap or because I couldn’t find a CIB. I never sold when they market was booming and won’t now or if it drops. Once that money is spent for me it’s gone. 
 

In game collecting there are so many different ways you can collect and each has different market volatility that you have to be able to adjust. 

Edited June 21, 2022 by Mr. CIB

[LutherDestroysTheGond | 690]

On 6/20/2022 at 9:32 AM, Tanooki said:

What one may say vs what they'll do is another matter.  I call bs on people not selling off the collection or a large part of it is the money dries up being out of work and out of unemployment checks.  It's why I started creating per system 'top' lists to just not dump and then over a year 80% or so of a collection into thousands a pieces went up in smoke back in 2005.

You say you won't, but when you're fucked, unless you're planning to build a home out of used game cartridges and using the boxes and manuals to make a fluffy couch or mattress and sheets I'm not buying that story it won't get reduced or lost entirely.

If someone can make a chair out of Dragon Warrior cartridges, I can start a Hooverville made out of Silent Service boxes and manuals!