CL Auction Analysis: Prices are down about 20% vs. June

[KarateBoy2k3 | 4]

Hello everyone,

 

I wanted to share some analysis of the CL auction as initial post. I'm a more recent sealed game collector, but I have some experience with CIB and I'm a long-time gamer. In my day job, I work as an investment analyst - so I like numbers. I tried to note the title variance where possible but I could have missed some.

As a starting point, I did a quick comparison across ~50 titles that were sold in both the June and October auction. I like this analysis because its the same auction company, same games, and very often same grade. For those games with a grade different, I show my value adjustment. I definitely a debate input (and I encourage the debate), but the overall conclusion is unchanged: the market as notable softened since the summer.  With a different set of grade adjustment you can get a more negative (or positive) picture market, but they account for the minority of the inputs.

In general, I would say that there are 3 ways to slice the data:

1. What did the average decline per game on an equal weighted basis? 14%

2. What did the average decline per game on a dollar weighted (so more expensive games carry more weight) basis? 16%

3. What is the median decline (half the sample did worse, half did better) 25%

 

This analysis excluded 6 games: the 5 Nintendo GBA classics and SNES Majesco since I don't think they are representative of the market and would bias the sample. The output is attached, however. 

 

Do I have a prediction? Well yes, but its not a strongly held one. My experience with markets leads me to believe that this is a now a momentum driven market and momentum is heading down. You have a lot of people who now own games worth less than market, and they are in it for the money so eventually they'll need to take a loss. Additionally, supply of graded games is likely to increase materially over the next 3-6 months as backlogs clear at Wata and VGA (plus the new entrants). 

I think most people know that Pokemon peaked in April-ish and is probably down 50%. I think this analysis shows that its no longer just Pokemon.

 

I'm trying to work with Wata to scrap their public data base of game sales and create

1. An index of for market prices over time (think something like S&P 500), including sub-index by franchise.

2. A more mathematical analysis of what 1 grade means for prices. 

3. A JoneBone like comparison of value by cross-grade between Wata and VGA.

 

If anyone can help me reach out to the right people at Wata, I'd be very happy.

 

I hope this post kicks off a good discussion!

 

Edited October 23, 2021 by KarateBoy2k3

[GetTheGreg | 105]

Do you mean reach out to Heritage Auctions for data where you mention WATA?  I'm not sure WATA has a public sales record for games (or maybe they do...?)

[KarateBoy2k3 | 4]

16 minutes ago, Maertens29 said:

Do you mean reach out to Heritage Auctions for data where you mention WATA?  I'm not sure WATA has a public sales record for games (or maybe they do...?)

Yes, typo on my end. I need to speak with HA. 

[a3quit4s | 4,097]

What’s “CL” auction? Sorry for my ignorance!

[jonebone | 1,307]

Hey I work with data for a living too and applaud the effort. Good to see, but I know this isn't an all inclusive population. For example, I won U90 Alien 3 this time for about $1200 that was $2500 last time. Also I won a Starfox Assault 90 last time around $550 that was $700 this time. Not sure what else is missing from the list, and excluding "outliers" here is not fair if being unbiased. You didn't exclude any that bombed...

End of day, analyzing data is easy with time but drawing meaningful conclusions is the more challenging part. My take is that the main consignor is famous for having high grade dupes. This auction showed that many of sales from June were one of multiples, with likely higher or equal grades appearing 3 months from now. Some buyers took notice and prices that had first to market advantage no longer had that.

Lots of great deals and very nice grades, but some head scratchers as well. I'd say it went about as expected overall, no meaningful change in market direction.

Edited October 23, 2021 by jonebone

[ThePhleo | 2,184]

I welcome and invite a downturn in market prices.

While it's true that I gave some extremely high premiums above the already all time high prices for some things I recently purchased, it's also true that I'm a long time collector who sees the value of owning some pristine high end pieces.

The thing about analyzing data is that you're supposed to check your bias at the door. Given a large enough dataset, anyone can pull anything they want relative to its subject.

[AdamW | 713]

Yeah, I'd say include the games that were excluded. Let people make their own judgments about what specific sub-sectors are behaving in different ways for whatever reasons. It's hard to justify for e.g. including a Majesco print of Castlevania IV but leaving out the Majesco Mega Man X.

Thanks again for the data, though! It's super interesting.

 

[DoctorEncore | 3,691]

I was actually thinking about posting a thread talking about a possible downtrend in prices on eBay. I've been routinely getting games for quite a bit less than Pricecharting listings lately. I'm collecting for less popular platforms (32x, Sega CD, SMS) so there may be some bias there, but the price trend is definitely stable to downward. I've even been able to snag a few sealed NES games recently which had been out of the question for most of the past year.

Edited October 24, 2021 by DoctorEncore

[Dumars2001 | 164]

3 hours ago, DoctorEncore said:

I was actually thinking about posting a thread talking about a possible downtrend in prices on eBay. I've been routinely getting games for quite a bit less than Pricecharting listings lately. I'm collecting for less popular platforms (32x, Sega CD, SMS) so there may be some bias there, but the price trend is definitely stable to downward. I've even been able to snag a few sealed NES games recently which had been out of the question for most of the past year.

Yeah, I also think that some prices have been slowly coming down lately but the "Big Name Titles" continue to go for premium/high prices.

I think the reason prices on CertifiedLink went lower than expected was because some collectors are getting ready to go all in on Heritage.

Next weekends Heritage Signature Auction should give a solid indication as to where things are in the market with sealed/CIB's for the big name titles. My hot take is that some records will be broken!

Edited October 24, 2021 by Dumars2001

[OptOut | 8,883]

Sealed/graded market RN:

[madmozz | 2]

Being a long time comic collector its so interesting to see the SVG market mirror the comic market and I suspect the same is true for cards. I 100% agree you can look at any data and come to any conclusion you want based on input. Just like comics day traders on the CGC boards get all wacked out over the results of one auction all of a sudden DOOOOOOOM is upon us. The fact is comics, cards and SVG seem to be slowing down a bit (I would suspect this has a lot more to do with people going back to work then with less demand for collecting) Last summers Heritage sale was groundbreaking & will be looked at and talked about for a long time to come as it did something that matters more then anything it changed perception of what SVG can and will sell for. I am willing to bet that when the results from next weeks Heritage auction are entered into the data used above we will see an upward trend for many games. The reality is Heritage is king at promotion and it never ceases to amaze me the quality of s#it they get in all collectables including SVG. You bet the SVG market will ebb and flow & as the hobby matures games will get hot and games will cool off( its happening now) but make no mistake "the time are changing" and there is no going back to pre summer 2021.

Edited October 24, 2021 by madmozz

[KarateBoy2k3 | 4]

22 hours ago, AdamW said:

Yeah, I'd say include the games that were excluded. Let people make their own judgments about what specific sub-sectors are behaving in different ways for whatever reasons. It's hard to justify for e.g. including a Majesco print of Castlevania IV but leaving out the Majesco Mega Man X.

Thanks again for the data, though! It's super interesting.

 

Sure, I'll report later with these included.

23 hours ago, jonebone said:

Hey I work with data for a living too and applaud the effort. Good to see, but I know this isn't an all inclusive population. For example, I won U90 Alien 3 this time for about $1200 that was $2500 last time. Also I won a Starfox Assault 90 last time around $550 that was $700 this time. Not sure what else is missing from the list, and excluding "outliers" here is not fair if being unbiased. You didn't exclude any that bombed...

End of day, analyzing data is easy with time but drawing meaningful conclusions is the more challenging part. My take is that the main consignor is famous for having high grade dupes. This auction showed that many of sales from June were one of multiples, with likely higher or equal grades appearing 3 months from now. Some buyers took notice and prices that had first to market advantage no longer had that.

Lots of great deals and very nice grades, but some head scratchers as well. I'd say it went about as expected overall, no meaningful change in market direction.

Well hello sir! Thanks for taking the time to reply - I am a fan of your work. 
 

You are correct that this list isn’t 100% comprehensive but I do think it’s statistically significant. I leaned into the  general rule of thumb for the Large Enough Sample Condition is that n≥30 (IIRC the sample was n=46). I would also note that your two additional examples broadly reflect the dollar weight averaged decline: you bought two games for $1900 that previously sold for $3050.

That said I’m happy to update the post with additional example to make it more of a data base vs. representative analysis. 
 

I would also LOVE your feedback on my assumed average mark up by VGA grade. I’m relying on the small sample set that is my own experience and I know you’ve been around for years.  

I just got my hands on HA’s Wata sales database and am working on a cross-grade value analysis to complement your prior work. To be clear: my goal is to see at what grade are values about equal between Wata and VGA (not what they would cross grade at).

 

Do you think your prior cross grade post still holds true a few years later? Or has the grading criteria changed? My observation is that a VGA 85 and 85+ have a very wide range of outcomes when it comes to condition. Probably a very strong 85+ is the best deal on the market, but there are numerous examples (at this auction) of multi-corner poke 85+s that I doubt would hit the “sweet spot” 

Edited October 24, 2021 by KarateBoy2k3

[tidaldreams | 654]

If you're using CL's auction archive as the source, it's missing a lot of games for some reason. For example, there was either an 85+ or 90 Toys r' Us exclusive Baten Katios that sold for ~$400 and 90 MGS Twin Snakes that sold for ~$600 in the July auction. I remember those because I regret not bidding on them. And there are probably more of them.

Edited October 25, 2021 by tidaldreams

[jonebone | 1,307]

11 hours ago, KarateBoy2k3 said:

You are correct that this list isn’t 100% comprehensive but I do think it’s statistically significant. I leaned into the  general rule of thumb for the Large Enough Sample Condition is that n≥30 (IIRC the sample was n=46). I would also note that your two additional examples broadly reflect the dollar weight averaged decline: you bought two games for $1900 that previously sold for $3050.

That said I’m happy to update the post with additional example to make it more of a data base vs. representative analysis. 
 

I would also LOVE your feedback on my assumed average mark up by VGA grade. I’m relying on the small sample set that is my own experience and I know you’ve been around for years.  

I just got my hands on HA’s Wata sales database and am working on a cross-grade value analysis to complement your prior work. To be clear: my goal is to see at what grade are values about equal between Wata and VGA (not what they would cross grade at).

Do you think your prior cross grade post still holds true a few years later? Or has the grading criteria changed? My observation is that a VGA 85 and 85+ have a very wide range of outcomes when it comes to condition. Probably a very strong 85+ is the best deal on the market, but there are numerous examples (at this auction) of multi-corner poke 85+s that I doubt would hit the “sweet spot” 

Hey, glad to see the analysis and would love to see it updated.  A few comments to your questions:

1) N >= 30 is a good sample set on a large data set, but if the data set is only 46 items I'd argue it isn't sufficiently large (and the possibility of cherry picking).  You didn't exclude the -76% data point, so I wouldn't exclude +100% data point either.  I'd run the analysis on the entire data set and let people choose if they are excluding anything themselves.

2) VGA markup by grade isn't a science, rule of thumbs aren't that great.  For a game with sealed cases 85 to 85+ is negligible as 90s (or even 90+ / 95) will pull the strong prices.  For a game with little graded copies, the difference between 85 and 85+ could be double or higher.  I get what you're trying to do here, but the best comps will be same grade to same grade.

3) I've heard rumors that the crossover article will be updated at some point as Wata scales.  Not sure how much truth there is to that though.  But remember, the grading criteria is very system specific.  I'd say that article is decent for cardboard crossovers, but disc based systems may have little to no applicability.  The grading metric on PS1 or Gamecube / newer is really night and day at VGA / Wata between manual creasing / centering issues, etc.  VGA Is all wrap on newer stuff but Wata is much more focused on manufacturing flaws.

Edited October 25, 2021 by jonebone

[DarkKobold | 190]

It's important to remember that we're also in the pre-Christmas lull. I don't trust any pricing "predictions" that don't take time of year into account. The same thing happens in Real Estate, apparently. If these numbers hold into January, then there's a trend downward. If not, then it's just the season for cheaper video games.

https://blog.pricecharting.com/2009/11/happy-lowest-game-prices-week.html

[AdamW | 713]

I mean, that's based on all-market sales from 12 years ago, so it's of rather limited relevance, you'd think. There are obvious reasons why prices of games being bought for actual play would bump around the holidays, but it doesn't necessarily hold true for four- to six-digit sealed games being bought by rich people to put on a shelf. They're not likely to be buying them as holiday gifts, or with money received as a holiday gift.

I think a lot of HA records were set in the November 2020 auction...

Edited November 2, 2021 by AdamW
duh, digit, not dollar