The definition of "classic" has been stretched to include veteran, vintage and post-war models. The category now includes almost anything made before 1973 - exempt from road tax - and some later vehicles rare or sporty enough to attract a following.
At the top end of the market, veteran and vintage cars like Rolls-Royce 20/25s, 3.5litre and 4.5litre Bentleys and Bugattis are selling well. Although prices are still less than half what they were a decade ago, they have risen in the past two years. Americans are the most aggressive buyers, encouraged by record share prices on Wall Street.
The middle market, between pounds 10,000 and perhaps pounds 80,000, has suffered the biggest losses. Cars like E-type Jaguars, Porsches and Aston Martins are now good value, according to Julian Shoolheifer, Sotheby's classic cars specialist. Many cars in this price bracket were expensively restored during the boom and now sell at less than the cost of restoration.
A new generation of post-Second World War cars priced at less than pounds 20,000 are also in demand, partly because they are relatively easy to drive and maintain, and have better performance than the run-of-the-mill pre-war cars which still survive. Post-war cars are also now the cars that collectors with money to spend remember their parents owning in the 1940s, 1950s and 1960s.
These "useable classics" will cost more to maintain than a modern vehicle but brokers like Footman James, Classic Direct, Jardine Faber, Firebond, the AA, Lancaster Insurance Services and Hastings Direct offer insurance for as little as pounds 100 a year for ordinary classics provided they are kept in a garage and do less than 3,000 miles a year.
Post-war classic prices are low partly because many cars will not operate on lead-free petrol and potential buyers are deterred by the impending withdrawal of four-star petrol.
Fast sports saloons of the 1970s and early 1980s like Golf GTI Mark1s and Renault Turbo 1s and 2s are also beginning to attract attention, according to Shoolheifer. (The Golf GTI Mk1 is his top tip for future stardom.)
Royston-based dealer John Brown singles out well-maintained Rolls Royce Silver Shadows of the 1960s as exceptional value at pounds 10,000.
There is no shortage of specialists offering restoration and spare parts suppliers. Most marques are now supported by specialist clubs which hold stocks of spares and increasingly arrange for vital spare parts to be re-manufactured.
Glossy monthly magazines include reviews of auction prices and average value tables for cars in excellent or average condition and those "needing some work". When it comes to buying and selling classic cars, there is a choice between going to car auctions, to dealers or to private sales.
The main auctions are run by Brooks, Sotheby's, Christie's and H&H. Although they offer prestige cars costing between six and seven figures, they do include cars which sell for under pounds 1,000. For buyers who know what they want and what to look for, auctions are the cheapest places.
Dealers offer more explicit guarantees that cars are in good condition for their age, and most dealers will service and give an MOT to cars they sell.
Private sales remain the largest single market-place and this is an area where caveat emptor still applies, although there are still bargains available.
The AA offers an inspection service for vehicles over 25 years old, but members will have to pay from pounds 230 for cars under 2.5 litre engine size and up to pounds 370 for luxury and sports cars for non-members.
n Contact: Brooks, 0171-228 8000; Christie's, 0171-389 2851; Sotheby's, 0171-293 5000; H&H, 01925 730630; John Brown, 01763 852200; Classic Club Direct, 0800 501250; Footman James, 0121-5614196; Firebond, 01223 566020; Jardine Faber, 01604 639011; Lancaster Insurance, 01480 484848; Hastings Direct, 0800 111066; AA, 0800 444777.