How can something as beautiful as a diamond ring possibly be an investment for the future?
Here are 5 reasons why.
1. Brand New Items Depreciate
When you purchase a brand new car, people are very comfortable with the idea of depreciation. They understand that once a brand new car leaves the yard, it significantly drops in value. People have since learned, buying a car 2-5 years old is a fantastic buy as you don't pay the premium that you would for a brand new one but the car still functions just as well.
Buying diamond jewellery is extremely similar. When you walk into Tiffany & Co. or another Luxury Jewellery shop, you are given the brand new car experience. However, once you purchase the item and walk out the door, the piece you have purchased has just significantly dropped in value.
Therefore the diamond jewellery you purchased can be exactly the same as it was before and after you walked out the door, the only difference is the value.
2. Diamonds are Recyclable.
Second-hand luxury diamond jewellery can be exactly the same as it was before and after purchase, not even removed from the box. However a person trying to sell this second-hand would not be able to get back even close to their purchase price. This is because so much of the value of a luxury item such as a Tiffany & Co. diamond necklace is tied up in the extrinsic worth of the piece.
If you took an item such as an Engagement Ring to a jeweller they would offer close to wholesale. The diamond would then be re-circulated back into the market place only to be re-sold again at a later date.
The same holds true for gold. Most of the gold in circulation today has been around for a century, millennia or two. Gold and diamonds are repeatedly being recirculated.
What this means is that it is possible to purchase a Pre-loved premium luxury branded item such as Tiffany & Co. Diamond Necklace or a pair of Tiffany & Co. Diamond Earrings at a fraction of the original price.
You are preserving the workmanship and avoiding the raw materials being recirculated back into production only to be re sold again as new.
3. Luxury companies continue to raise their prices every year.
Luxury fashion houses such as Louis Vuitton and Chanel, and Luxury Jewellery stores such as Tiffany & Co., continue to raise their prices year on year. This is based on many reasons such as how well the company is going, the economy, the strength of the US dollar and other factors such as inflation.
As a result the demand for second-hand luxury pieces has increased dramatically over the last few years as more people look towards vintage purchases instead. This has been seen in luxury hand bags and also luxury jewellery. The pre-loved luxury market has become one of the fastest growing sectors in the retail landscape.
Therefore by buying luxury items pre-loved you save money and acquire a piece that can increase in value.
4. A Second-Hand luxury item appreciates in value.
So once an item takes that first initial hit from brand new to second-hand, the second-hand item continues to hold its value. This is because the item is now valued on the intrinsic qualities of the piece. As luxury houses increase their prices the re-sale value of this second-hand item also increases. You can read about this more here.
For example: a diamond purchased in 2004 may have cost $4000 retail. In 2014 that same diamond may now cost close to $10000 retail.
Therefore if you bought that 2004 diamond pre-loved for $2000 that same diamond would now sell pre-loved for approximately $5000 because the current retail has increased.
The diamond you purchased is now worth more than double the price you originally paid.
5. Second-Hand Items are Relatively More Fungible
Customers who purchase second-hand also able to realise their original purchase price relatively easily. This is because people don't differentiate between a second-hand item that has changed hands more than once.
It is possible to purchase pre-loved luxury item, use it for a year or two and then sell the item again at a later date.
For example you can buy a second-hand Tiffany & Co. Diamond Pendant wear it for a year or two and then re-sell the item at very close to your original purchase price. You can then use those funds to purchase a pair of second-hand Tiffany & Co. Diamond Earrings or go on a holiday!
It is the perfect commodity for those who like to shop and update their wardrobe on a regular basis.
So you can buy a beautiful item, save money and invest.
With the online marketplace growing more and more each year, people are becoming more educated, savvy and resourceful. Many customers are saving money by buying online and purchasing pre-loved.
Catherine Trenton Jewellery.
"We are an established boutique organisation specialising in Vintage and Near New Diamond Designer Jewellery from Tiffany & Co. and other luxury brands. As experts in this niche trade we work hard to provide a safe and simple environment for buying and selling pre-loved fine diamond jewellery online.
Whether you are buying or selling a piece of fine diamond designer jewellery, we aim to provide you with the best outcome possible.
Please visit our store here."