We've said it before and we'll say it again: The humble NYC Taxi medallion continues to be the best investment a person could have made way back when. How good? A man who bought two medallions for $80,000 apiece in the 1980s just sold them for $1 million dollars each. By the numbers, over the past 30 years the taxi medallion has outperformed the Dow Jones, gold, oil and the American house. No wonder some cab companies are so opposed to Bloomberg creating a new tier of medallions for the outer boroughs!
In fact there are already two types of taxi medallions out there: Corporate and Individual. The former are more expensive (like the pair recently sold), do not need to be driven by their owners and can be leased out 24/7. Individual medallions (which make up about 40 percent of the 13,237 medallions currently active) must occasionally be driven by their owner and are slightly less lucrative. The last one of those to sell went for about $700,000.
The question now is whether we are, as the Times puts it, "entering the tulip era of the taxicab? Could a million-dollar sale signal the beginning of the end of the great yellow cab bubble?" For answers, they turned to Graham Hodges, a professor at Colgate who has written a history of the taxi industry. "No one is very good at forecasting the economic future right now, but I would say no," says Hodges "It will always make good money and pay for itself. There are certain things that are just gilt-edged assets, and this is one of them." So next time you flag down a DeLorean taxi time machine, forget the book of sports stats, just stock up on medallions.