Investing In Class 3 Guns Presents Great Opportunity
Retired law enforcement officer Ike has assembled a very impressive collection of guns over the last 30 years. During this time, many of them have increased dramatically in value. Some of his favorite pieces are Class 3, or Title II guns. This includes machine guns, silencers, short-barreled rifles, and destructive devices.
Class 3 Dealer
Ike was licensed by the federal government for Title II firearms to make and deal in these guns, which requires a Class 3 Special Occupation Tax. “What I really enjoy about Class 3 weapons is their history and the power of the weapon,” he said. “When you shoot it, you know it’s not the same as a semi-auto. It’s full power.”
Less than 30 years ago, Ike could get a Heckler & Koch sear for $600. “Now, they’re $36,000. So you can see the jump. It’s in the 6,000- to 7,000-percent category,” he said. His first M16 was $1,200. Now they sell for up to $30,000 depending on the gun.
1986 NFA Changes
The reason guns like Ike's M16 are so valuable is because of changes to the National Firearms Act, or NFA, in 1986. It contained a provision that banned the possession or transfer of machine guns, except for those lawfully possessed before the 1986 changes. For private citizens, who are not licensed dealers, only guns made before 1986 could be purchased. This created a pool of approximately 160,000 machine guns that could be purchased and transferred to consumers who paid for a $200 tax stamp and filed the paperwork. This finite amount of guns means their value almost always increases over time.
What confuses a lot of people are “post-86 dealer samples.” This refers to someone who has a Class II Manufacturer License, like Ike, who can own machine guns manufactured after 1986 with the intent to demonstrate or sell them to law enforcement.
However, these dealer-sample guns are not transferable in the same sense that pre-86 guns are. This means they can't be bought or sold by private citizens who pay for a $200 tax stamp. To give an example of the cost difference between a dealer-sample and a transferable machine gun, Ike showed us his beautiful Bulgarian AKS-74U. It is a dealer-sample, and it is worth about $1,200.
"A transferable AK like this one would be about $30,000 to $32,000,” he said.
Always a Great Time to Collect Guns
Ike highly recommends people who love guns start collecting them earlier, not later. Not only can you relax in your gun room surrounded by your babies, but you can invite friends over and show them your collection and spread the love of firearms. We certainly enjoyed his collection and the stories and often jaw-dropping costs of some of his beautiful guns.
If you're interested in collecting guns, Guns.com has a section that is dedicated solely to these beautiful works of art. Check it out below.