Who can afford a $5,000 guitar?

The answer to this question is not what you think it is.

Where things go into "too expensive" for most guitar buyers is when the guitar is the price of a fairly decent 10-year-old used car. At the time I write this, that tipping point price is $5,000 USD. For that cost, you can get any number of cars or trucks with under 100,000 miles that will run for a few years, depending on what it is.

To be clear, five grand will buy you a whole car.

Even though this is true, guitars that sell for this kind of money such as the Gibson 125th Anniversary Hummingbird seen above do sell regularly.

But why?

Let's find out.

When America is not in a recession, people buy stuff

When the nation isn't in a recession, it's not necessarily true that people are making more money. But it is true that more people can afford finance payments.

As a general rule, guys who spend thousands of dollars on just one guitar rarely pay for it all at once. It will be financed. In fact, you will see on that link for that guitar that it can be financed for $230/month for 24 months.

When the American economy is doing well, guitars like the Hummingbird do get sold because buyers are confident enough they can either ride the 24 months out, or maybe ride 12 to 18 months and then pay the whole thing off early (which you can do).

Some guys will even buy the guitar just as a means to rebuild credit. When the economy is good but your credit is bad and you keep getting denied over and over again, chances are Guitar Center's finance program will approve you anyway.

When America is in a recession, priorities change

It's been over 10 years since America has been in a recession, and many economists say one will happen in mid or late 2020. Should you be worried about this? Not really, because economists often get things wrong. But they are correct the nation is overdue for a recession.

In times of recession, people come to the realization very quickly that absolutely nobody needs anything in a guitar store. What typically happens is that guitar stores go into panic mode and immediately make every attempt to dump the expensive inventory, even if it means selling guitars barely above cost. After that a shift happens where many stores will refuse stocking anything that sells for over $2K, and then the store just rides out the recession until things start getting better again.

What I'm seeing right now in the Guitar Center stores I've been to is many over-$2K choices. The economy is doing well, buyers are confident enough to finance $2K to $5K, so sure, GC will stock them since most will move.

But when the next recession hits, those same stores will flush out that expensive inventory quick.

When is the best time to buy that expensive guitar?

There are some who believe the best time to buy expensive guitars is when the economy is at its worst so you get the best deal.

I disagree with this.

In times of a better economy, there are few significant advantages.

For really expensive guitars, warranty service (should the guitar require any) takes 1 to 3 months to get back to you in a good economy, and 3 to 8 months when it's bad because of downsizing.

Inventory of more expensive guitars is more plentiful in a good economy, so if you get a dud, it can be replaced. In a bad economy, you could be stuck with the dud because replacement guitars might not even exist.

For expensive guitars with custom parts, the same applies. Good economy = replacement parts available. Bad economy = get on a waiting list with no guarantee you'll ever get the part.

Should you finance a guitar?

I've said before that financing a guitar is a really bad idea, however... if you actually need to purchase a "big" thing in an effort to rebuild credit and are confident enough you can swing a 2-year term, then yes, go for it.

For credit rebuilding purposes, yes it is easier to buy one moderately big thing instead of many little things. And by moderately big, $5K works for that purpose.

Would I personally go for the Hummingbird?

No, because I prefer electrics.

If I was intent on spending $5K, my choice would be guitar + combo amp, old-school style. Namely, a USA-made G&L Comanche and Fender Custom Deluxe '64 1x12 combo.

For those not familiar with the Comanche, it has "Z" coil pickups, sorta/kinda like a Precision Bass pickup where it has all the character of Strat single-coil with no hum. It's actually a really cool pickup design. And yes the guitar is available in a much less expensive Tribute import model. You don't need to blow over 2 grand to get one.

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Published 2019 Jul 26