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Personally I don't see the extra $10k on mods being better value for money than the extra you will pay for the M3.
Mods may or may not bring M3 performance within reach (let's face it, real-life opportunities to test this in anger will be be few - most of us will not get to find out save from reading about it), but that money spent will most likely subtract value from your car (would I pay RRP for a slightly used M3? Probably. A modded 335i? Not a chance).
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