LEGO: How to Make your Fortune

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We’re all familiar with the idea of investing in shares, jewellery, and start-up companies, but plunging money into the world of toys is a whole new ball game. One toy in particular has stood the test of time, and shrewd buyers can make a killing if they invest wisely. It was voted “Toy of the Century” by Fortune Magazine, and its name is - LEGO.
Children have enjoyed LEGO for more than five decades
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Children have enjoyed LEGO for more than five decades

Why is LEGO Popular?

LEGO bricks have been around for more than 50 years and have millions of fans, yet only a small percentage realise there is money to be made investing.
 
Brothers Jeff and Ed Maciorowski run the website Brickpicker.com, dedicated to the world of LEGO investment.

3 reasons for LEGO's popularity according to Brickpicker.com:
  1. It’s a classic toy of impeccable quality, that can be made into an infinite amount of creations. A LEGO brick from 50 years ago can be interchanged with a brick from today and the colours, fit and finish are all the same.
  2. Another reason why LEGO sets are investment options is that they are extremely popular.  The LEGO Group has posted year over year profits for the last eight years and currently sit as the number one toymaker in the world.
  3. A final and probably the most important reason that LEGO sets are serious investment options is that they are produced in limited quantities, with each individual set having a limited production run of a certain length and then retired. The fact that LEGO sets are retired creates a very collectable and in some cases, rare item.
The LEGO minifigure can be highly collectable
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The LEGO minifigure can be highly collectable

Tips for LEGO Investors

These are the qualities that a novice LEGO investor should look for when choosing LEGO sets for investments: 
- LEGO sets with rare pieces and mini-figures.  LEGO mini-figures are often called the “currency” of the LEGO world and are highly collectable and popular.  Some individual mini-figures can sell for tens, if not hundreds of dollars.   
 - Licensed sets such as Star Wars, Harry Potter and the DC Comics and Marvel Superheroes can appreciate very well after retirement and many contain valuable and highly collectable mini-figures. 
- Large sets, with 1,000 pieces or more, seem to exhibit strong returns on investment. The largest set of any LEGO theme can be the safest choice in this author’s opinion.
- LEGO sets with a low price per piece ratio, usually around $0.07/5p a brick (based on manufacturer's suggested retail price) can be profitable.  
- Sometimes new LEGO sets are “parted” out and resold to LEGO fans as individual LEGO pieces.  This is a huge market and helps many LEGO fans and builders acquire pieces they could not buy otherwise.
Keep an eye out for sets with short production runs
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Keep an eye out for sets with short production runs

More Tips - Unusual Sets

LEGO sets with short production runs usually equate to rarity.  Many LEGO sets have around a two year production run, so anything less is optimal.  

The rarer the set, the more valuable it is. Collectors or Limited Edition sets can appreciate to higher levels than unmarked sets. 

Small sets and polybags with rare minifigures or small “seasonal” or “holiday” sets are solid choices.  
The price has flown up for the Millennium Falcon
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The price has flown up for the Millennium Falcon

Themes: UCS Star Wars

Jeff from Brickpicker.com said that several themes have succeeded in bringing in big money for wise investors, including the Ultimate Collector Series (UCS).

He said: "Unlike many of the simpler Star Wars sets sold at convenience stores the UCS sets are highly detailed and complex builds, designed for the adult collector and wallet. They are large sets with large price tags, but usually appreciate very well.  

"One such example of this superior growth is the 10179 UCS Millennium Falcon, which had a MSRP of $499.99 (£330).  Current values for this set have reached $3500+ (£2,300) on eBay and other auction sites." 
The 10182 could be an expensive cafe
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The 10182 could be an expensive cafe

LEGO Modular Buildings

These sets are also designed for adult builders and are based on buildings found on an everyday city or town street, and can be attached to one another to make a complete city block.  

The 10182 Cafe Corner sold for $139.99 (£92) back in 2007 and now is selling for more than $1600 (£1055) on eBay, which computes to more than 1000% in ROI (Return on Investment). 
The Taj Mahal is valuable, used or new.
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The Taj Mahal is valuable, used or new.

Other Sets of Note

A small $9.99 (£6.60) set, like the 7884 Batman's Buggy: The Escape of Mr. Freeze, has grown more than 1300% in ROI and is valued more than $1300 (£860) in today’s LEGO secondary market.

Many LEGO fans will pay top dollar for a rare, retired, and previously built LEGO set that is in excellent condition. A “used” 10189 Taj Mahal sells for more than $1100 (£725) on eBay. 
LEGO investors can be broadly split into two bands
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LEGO investors can be broadly split into two bands

Types of Investor

Jeff said there are generally two types of investors in the LEGO world: long term (investors) and short term (flippers).
 
“Long term investors will hold LEGO sets for two-three years or longer,  ignoring many daily fluctuations in stock and prices, hoping to cash in a large profit one day in the future. "
 
“Flippers try to take advantage of lack of supply and seasonal market conditions to buy and sell LEGO sets quickly for a small profit.  They will reinvest these profits and repeat the process.  Both methods have their advantages and disadvantages.”
Be careful how you store and send your LegoEGO
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Be careful how you store and send your LegoEGO

Pros and Cons of Investing

LEGO sets can take up a lot of space. The cardboard boxes are susceptible to sun and water damage, take up a lot of space, and can be crushed from the weight of the other sets.
 
The selling, packaging and shipping process is time-consuming and arduous in many instances. There are also fees, commissions and taxes to take into account when a person sells a LEGO set.  
 
Jeff said: “Investments are not guaranteed to appreciate, but even so thousands, if not millions of LEGO fans will venture into the hobby and/or business of LEGO collecting, investing and reselling. Many will be very successful and will experience positive returns on their original investment year after year.  
 
“The future looks bright for the LEGO secondary market.  The continued production of new, creative and stylish LEGO sets that retire and become collectable, coupled with the enduring quality of the LEGO brick, will enable the LEGO secondary to prosper into the foreseeable future.”
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