Are Luxury Watches a Good Investment?

17 May 2023

admin@watchcapital.com.sg

Luxury watches have always been a symbol of status, wealth, and taste. These timepieces, produced by renowned brands, are frequently linked to opulent style, excellent craftsmanship, and cutting-edge technology. But beyond their aesthetic appeal, are luxury watches a good investment? For many enthusiasts, investing in a luxury watch is not just a fashion statement but a smart financial decision. In this article, we will explore the reasons why luxury watches can be a good investment and how can we make the most of it.

Getting to Know the Market for Luxury Watches

Before purchasing a watch with investment in mind, you’ll have to conduct some research. For example, due to the high number of counterfeits that flood the market for both brand-new and pre-owned luxury timepieces, buyers will need to know how to spot a fake luxury watch to avoid being duped. You will also have to get in touch with where the market is shifting towards, such as vintage, pre-owned, or brand new. This can help you predict trends and increase the value of your timepieces.

What Affects the Value of Your Luxury Watch?

Rarity

When demand exceeds supply, the value of a certain product will rise. Limited edition models, rare materials, or discontinued models can fetch a high price in the eyes of collectors. This can be seen in Patek Philippe’s Nautilus, Rolex Daytona Paul Newman, and Audemars Piguet’s Royal Oak, which are highly sought after due to their limited production runs.

Age and Condition

The age and condition of the watch are also critical factors to consider. Vintage watches from the 1950s and 60s, for example, are highly sought after, and their rarity can make them valuable investments. However, the condition of the watch is equally important. A well-maintained vintage watch can appreciate in value over time, while a poorly maintained one may decrease in value.

Craftsmanship and Design

Each luxury timepiece is crafted by a team of professionals who have years of experience in the art of watchmaking. Instead of being churned out in a factory, they are handmade and can take months for a piece to be completed.

A single watch from:
Patek Philippe can take up to two years to be ready, depending on the model and complexity of its design.

Rolex could need up to 12 months, with only one million pieces produced each year.

Audemars Piguet may require a year, with time added to when it comes to decorating and subjecting it to extensive testing.

Omega can take up to 500 hours, with the number of production varying according to each model.

Furthermore, luxury watches that are made with high-quality materials like gold, platinum, or diamonds, and that feature intricate movements and complications, are often more valuable than simpler designs.

Current Trends in the Market

The luxury watch market is always evolving, and current trends can have a significant impact on the value of certain models. For example, vintage watches may be in high demand one year and less desirable the next. Keeping up with current trends in the market can help you make informed decisions about buying and selling luxury watches.

Association with Celebrities or Movie Characters

Celebrities and movie characters can have a significant influence on the luxury watch market. Rolex’s Submariner and Chronograph, along with Omega’s Seamaster, are often associated with James Bond. Robert Downey Jr’s globally acclaimed portrayal of Iron Man has been spotted wearing a plethora of luxury watches, ranging from Jaeger-LeCoultre to Audemars Piguet, making them highly sought after by collectors.

What are the Pros and Cons of Investing in Luxury Watches?

Investing in luxury watches can be a lucrative venture, but it also comes with risks. Here are some pros and cons to consider before making a decision.

Pros:

Potential for high returns: As we discussed earlier, luxury watches can appreciate in value over time, especially if they are rare, in good condition, and made by reputable brands.

Tangible asset: Unlike stocks or cryptocurrency, luxury watches are a physical asset that you can enjoy wearing or displaying.

Diversification: Investing in luxury watches can be a way to diversify your investment portfolio.

Status symbol: Luxury watches can also be a status symbol that displays wealth, taste, and sophistication.

Cons:

High upfront cost: Luxury watches can be expensive, so investing in them requires a significant upfront cost.

Market fluctuations: Like any investment, the luxury watch market can be volatile, and values can fluctuate.

Maintenance and storage: Luxury watches require maintenance to keep them in good condition, and proper storage is necessary to prevent damage or theft.

Counterfeit risk: As mentioned earlier, the luxury watch market is flooded with counterfeit watches, which can be difficult to spot.

Tips for investing in luxury watches:

Do your research:

Before making a purchase, learn about the brand, model, and the factors that affect its value. Research the market trends and the reputation of the seller or dealer.

Buy from reputable sources: To avoid purchasing a counterfeit watch, buy from authorized dealers or established sellers with a good reputation.

Look for limited editions: Limited edition models often have a higher value due to their rarity and exclusivity.

Keep the watch in good condition: Regular maintenance and care can help preserve the value of the watch. Store it in a safe place, avoid exposing it to extreme temperatures, and have it serviced regularly by a professional.

Where can I sell or consign my luxury watch?

If you’re looking to sell or consign your luxury watch, there are several options available. You can sell your watch privately, through an auction house or a luxury watch dealer, or you can consign it to a luxury watch marketplace. However, it’s crucial to do your research and choose a reputable and trustworthy dealer or marketplace to ensure that you get the best value for your watch.

Come to us at Watch Capital for a personalized experience when it comes to selling or consigning your watch! We will walk you through the process, while also taking care of the paperwork.

How to take the first step?

Contact us by sending an enquiry or booking an appointment with us, at Watch Capital to take the first step in selling and trading, or consignment of watches!

If you are interested in buying a brand-new watch, or a pre-owned one, we have an extensive collection available for you to browse through!

CATEGORIES

SHOP BY BRANDS

SHOP BY

SPECIAL SOURCING

FAQ

BLOG