When you think of investing, you likely think of stocks, real estate, precious metals, etc. But increasingly, investors are looking beyond the traditional asset classes, into newer investments.
Watches — and particularly luxury watches — have become quite the hot investment in many circles. Vintage watches from luxury brands like Rolex and Patek Philippe command the highest prices, but even less popular brands often fetch high values.
What’s going on with investing in watches — and is it worth investigating yourself?
This may seem overly simple, but it’s worth reconsidering:
Investing is simply buying something that you believe will increase in value over time.
If you believe that a company will grow, you may wish to invest in that company’s stock. Likewise, if you believe that a vintage watch will increase in value, it may be worth buying it as an investment.
Watches weren’t traditionally thought of as an asset class, but that’s starting to change as more investors get involved.
The market for vintage and luxury watches exploded back in 2020, right at the start of the pandemic. As supply was limited and more people started to buy, demand far exceeded supply — leading to a surge in prices.
The trend has continued ever since, with prices for both new and used luxury watches surging. Is it too late to get in on the action?
For high-end brands like Rolex and Patek Philippe, prices have certainly risen substantially. But savvy investors still see value in mid-range watches, from brands like Heuer, Omega, Cartier, Breitling and others. And as we have seen with countless other asset classes, prices can continue rising for much longer than many investors suspect.
When it comes to investing in watches, here’s what to pay attention to:
Brand: The brand of the watch will have the biggest impact on collectability, and therefore value. In addition to top-tier brands like Rolex, investors are considering lesser-known but collectible brands such as Longines, Vacheron Constantin, Audemars Piguet, Zenith, Girard-Perregaux, Jaeger-LeCoultre, Breguet, Blancpain and others.
Model: The model also influences pricing. You can research how many of a given model were produced to gauge how rare it might be, and look at online watch markets to browse value.
Condition: The condition of a watch should be nearly perfect in order for it to be considered investment-grade. If someone is spending tens of thousands of dollars on a watch, you can bet that they won’t want it scratched up!
Investing in watches takes substantial effort. You’ll need to select the watch(es) that you believe will appreciate in value — and have a clear theory as to why you expect them to appreciate. Then you’ll need to actually locate that make and model for sale, hopefully at a reasonable price point.
The most important aspect to consider when buying or selling a high-end watch is who you conduct the transaction with. It’s vital to work with a trusted dealer.
The watch market is unfortunately flooded with fakes and counterfeits. Only a well trained dealer should be trusted to evaluate watches for fakes.