Taxi medallions are licenses to operate cabs in the large metropolis regions such as New York, Chicago, Boston and others. The number of these medallions is restricted and controlled by the city, and if you wish to purchase a medallion, you will have to wait for an auction where other owners may wish to sell their medallion(s). When you own a medallion, you are assured a part of the revenue that the cab earns while it is in operation. Additionally, the restrictions on the issuance of new licenses make the medallions progressively more valuable - and in recent times their value has grown in the 10-18% range per year.

New York, Chicago and Boston have long histories of taxi medallions, starting from around the Depression era. New York and Chicago continue to have active markets for buying and selling taxi medallions, with price of the medallion reaching in the neighborhood of $380,000 in New York. Boston has a strong medallion market as well, but there has been an extended legal dispute on the issue of creating new medallions in the city. The number of medallions in Boston was for years limited to 1,535 as set in 1934. In a long running case (Lynch vs. Police Commissioner of Boston), the number of medallions has been ordered to be increased to an eventual total of 2025. The city however has complied only half-way, and a potential overhang of 300 medallions still sits over the market. Much of the dispute seems to be around the technicalities of the court order - and there seems to be little doubt that eventually these 300 additional medallions will come into the market. The Boston market however will easily absorb this excess, but that may keep the prices flat in the meanwhile.

New York and Chicago are however seeing excellent demand and restricted supply, and continue to offer the best opportunities for those wishing to get into the taxi medallion business, especially for the first time. Even a rise in the number of leases available in New York in the last several years has not dampened the rise in their value, indicating strong pent-up demand for the medallions. Our recommendation to you would be to examine these markets in preference to others, and seek out your first medallion in an auction at these two cities. Incidentally, Medallion Financial actively offers their services as a financer for medallion purchases, should you seek such financing.