It's really difficult to give value estimates on a Luger with incomplete information. Those that are as close to factory condition as possible are the most valuable. Matching. Original finish.
Once your reach 80% finish or so, it's not really collectible.
Rarity of a variation also affects price. This one (1916 DWM Military) is not particularly rare.
If it's all matching and in original finish, it will be worth more than $1200 and probably less than $1750. Your's probably is in the middle, a bit less with the grip panel damage. That would be for an all matching gun. Jay's estimates are reasonable (above). Anything you see advertised by a dealer online will be about 30% above what a collector would pay for a direct purchase.
Use extreme care if you decide to remove the grips to check if they are numbered to the gun. Lift the left one only slightly before sliding it down off the frame. Some numbered parts are not externally visible.
Our FAQ (follow the link at the top ot the forum page) has quite a bit of detailed information that may be helpful.
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