NFA Machine Guns and the Collector’s Market
By Ryan Sullivan
Of all the questions one can get asked about firearms, the most troublesome relate to value. In the collectible arms trade, numerous variables can impact the cash value of a piece. Condition and rarity are the big two, but many others come into play. In our previous auction, a client had questions about a particular item, Lot # 1384, a British-made STEN gun. For those not familiar, the STEN is what happens when you’ve short on time and resources, and long on Nazis eyeballing your homeland from across the English Channel; a conglomeration of stamped sheeting, tubes and springs that looks rough, feels rough, and treats the enemy even rougher. Most of the questions revolved around a particular feature of the item. Specifically, the fact that it had caught a bullet in the side.
The damaged area is about the width of the thumb, and deep enough to effectively flatten part of the trigger housing. In the surrounding area, steel is visibly cracked and torn. Multiple pins responsible for keeping the inner workings have been driven through the opposite side. Ahead, a filed down bolt has been driven through the hole originally occupied by the selector to hold the whole thing together. On a semi-automatic firearm, we’d be hard pressed to sell the thing as anything other than scrap or parts, especially to any client who wasn’t there in person.
Inflation adjusted, this STEN gun set the Brits back about $130 dollars. Less than the cost of a Hi-Point carbine. Today, 60+ years and a gunshot wound later, it went into the sale estimated at $4000 to $6000. It sold for $8050.
Such is the magic of the Hughes Amendment. Tacked onto the Firearm Owners Protection Act of 1986, the Amendment shut down tax registration of civilian machine guns. From that point on, there was a fixed upper limit on the number of machine guns available to the American public. Barring the rare amnesty registration, that number is never going up, and the value is unlikely to go down. This legally imposed rarity ensures that virtually any registered machine gun is worth money. Condition is nice, history is nice, functionality is great, but at the end of the day that little tax stamp is king. The stamp is the difference between a 4-figure payday or 10 years in jail for an unfinished metal tube. And no, that isn’t hyperbole or ghoulish overkill; we’ve literally sold a tube for just over $3,000.
In the same vein, you have the drop-in auto sear, which could be accurately described as “an aluminum block with a serial number on it and some paperwork”, and also accurately described as “having a sale price of $37k”. Since that little aluminum block was registered prior to 1986, it’s a transferable ‘machine gun’ in the eyes of the law.
From a collecting and shooting perspective, this arrangement is quite burdensome, since any transferable machine gun has a value (and cost) well beyond the sum of their parts and labor. On top of that, the law needs to be followed, which can vary dramatically between states on top of the federal obligations. Between the expense and the hassle, all but the most committed parties are driven away. There’s no such thing as a “casual” machine gun owner.
With other genres of collecting, there’s always a danger of a sudden shift in value; a newly published book might call into question the rarity or originality of a previously well regarded scarce variation, or a large, overlooked or unknown collection of the same item might hit the market and cause a short-term depression in value as the market temporarily “floods”. However, nothing ‘sudden’ is apt to happen to machine guns. Legal changes for good (a new amnesty, a loosening of NFA rules, etc.) or for ill (adjustment of the tax stamp cost for inflation, new requirements for transfers, or an outright ban) can be seen coming well in advanced or are downright improbable. Any “previously undiscovered” machine guns are likely to be destroyed due to lack of registration, so Class III owners don’t have that worry either. About the only winners in the situation are those who chose to invest in them. The current trend in machine gun values can be condensed into a single word: “up.”
There are 50 Class III/NFA items in our December 2018 Premiere Firearms Auction.
Rock Island Auction
7819 42nd Street West
Rock Island, Illinois 61201 USA