A keen eye for potential coupled with good timing can mean a sensible investment. With a high-end luxury watch, you can watch the time pass by as it appreciates in value. The market for quality timepieces has expanded in recent years as investors and horologists have formed the opinion that a watch collection might be a better place to grow your money than a savings account.
The appeal of collectible watches
Beyond the appeal of investment, there are several reasons your clients might have one or many high-end watches. When properly cared for, a luxury watch is something functional you can wear in your everyday life. Watches are fashionable and aspirational. A timepiece from a highly regarded watchmaker can be a symbol of status and a source of personal pride.
People invest their money in watches as a statement about their sense of style, while others see them as an heirloom that will be passed through family generations. They can add to an existing watch collection, or even as a portable asset that lends itself to easy conversion.
Independent watch dealers and the secondary market
Watch collectors engage in a global network of independent watch dealers who buy and sell new and used luxury watches. The condition of this market can affect the value of watches. In the wake of the COVID-19 slowdown, financial experts observed the recovery of the watchmaking sector was buoyed by the secondary market.
There are several advantages collectors can enjoy when buying from independent dealers in the secondary market:
Rolex
Country of origin: UK/Switzerland
Year established: 1905
Most desirable models: Submariner, Oyster Perpetual, Daytona
Did you know: Every Rolex watch that uses Roman numerals on its face adopts a clockmaker’s “IIII” rather than the traditional “IV” to allow for better symmetrical balance.
Audemars Piguet
Country of origin: Switzerland
Year established: 1875
Most desirable models: Royal Oak, Millenary Collection
Did you know: In the early 1970s, designer Gerald Gretna was only given one day to develop the design of the iconic Royal Oak model with the brief to create a sports watch for all occasions. He based the hexagonal face with visible screws on a traditional diver’s helmet, and it remains the brand’s most enduring model.
Patek Philippe
Country of origin: Switzerland
Year established: 1838
Most desirable models: Nautilus, Aquanaut, Grand Complications
Did you know: Queen Victoria, Pablo Picasso, Nelson Mandela, Leo Tolstoy, Pyotr Tchaikovsky, Albert Einstein, and Marie Curie are all reported to have owned timepieces made by Patek Philippe.
Determining watch value
Several factors can affect the value of a watch and will be considered by both your clients and the specialists who can determine the watch’s value. These include:
All of these factors, combined with market supply and demand, will impact how much your client’s watch is worth. Over time, some watches appreciate, others hold their value, and some can fluctuate, depending on what is available in the secondary market. It’s important to speak to your clients about the importance of regular valuations. Valuations are also used when determining an appropriate level of insurance protection cover for a luxury, high-end watch.
Brit have extensively worked with DOERR Dallas Valuations when protecting private clients’ watch collections. They are market leaders in assessing timepieces and assigning an accurate value within the context of current market conditions.
Market conditions in action
In August, DOERR Dallas Valuations published a blog that revealed how recent market conditions could impact the value of the Patek Phillipe Nautilus 5711.
Below we can follow the key dates and influences that can impact a watch’s value:
This example illustrates how a watch’s market value can jump by as much as 300% in 18 months. This has enormous implications for collectors and the level of protection they require for their watches and new models coming to market will have their own considerations with regards to value over time.
“Whilst the market price of the Nautilus range continues to drop, it’s still noticeably more than it was at this point last year, and still around £100,000 more than the original retail price of this model.
With the new Patek Phillipe 5811 hitting our shores very soon, it can only mean more volatility for the market, so accurate valuations are the key between client and insurer to make sure that if the worst happens, the insured can replace their watch.”
Need any help protecting your clients' assets?
If you want more information on how Brit can help with protecting your client’s high-end luxury watches. Contact our Private Client team.
