Perspective on future resale price & choices in life

[watchf]

I need some perspective on some 2 questions from the good folks here.

1) How much would you estimate according to past trends of the resale value in terms of estimated dollars or % of its current price (please indicate if its % of rrp or grey market price) of the below watches in 2, 5 and 10 years time on the used market,

• TT DJ II
• Milgauss GV
• Explorer 39mm
• Sub-C LN

On past trend does the value increases in a linear pattern over time, for example if resale value increases by X in 5 years, it would be about X x 2 in 10 years? In general would the resale value be more or less than its current BNIB price?

2) If you were to choose between two luxury items which you do not need in an objective way, item 1 being a new car & item 2 would be Rollie watches, which one would be a good investment or rather the one you could most justify the spend on if the price on both are almost the same (a new car vs a couple of Rollies)? Lets put the price at say $25k, so either $25k for a car or a number of watches...OR...would you rather have the cash sitting in the bank earning interest?

[Sub Man]

Errrr.... Can I phone a friend???

[rolexsweep]

Originally Posted by Sub Man

Errrr.... Can I phone a friend???

hahhahahahahahahahahahh exactly what i was thinking

[esm]

interesting style of questions.

i have sat for 3 exams in the past 3 weeks for work... (last one was yesterday) so i will give it a miss for now.


tip - if there is an itch.... better to scratch it sooner than later.


(thank me later )

[awright102]

[padi56]

No further comment other than I have bought all my Rolex because I wanted too just for wearing.Rolex watches are not all about ££££$$$$ will this or that model go up in value etc.

[Dan2010]

The answer is C.

[(213)GMT]

Originally Posted by Dan2010

The answer is C.

Correct.

[esm]

Originally Posted by Dan2010

The answer is C.

i have a sneaky suspicion that they were not multiple-choices questions, Dan

[Dan2010]

Originally Posted by esm

i have a sneaky suspicion that they were not multiple-choices questions, Dan

Oh oh oh, the answer is False. Sorry.

[Ray T]

if you are buying a rolex and worrying about resale value down the road, rolex might not be for you.

if you are looking to invest, luxury items are probably not the way, you need a different forum about how to invest your money.

[want to be]

I do not know.

[watchf]

You folks are mistaken. Please do not jump on the watches are for wearing not for investing theme the minute you see the word 'resale value'. What I am asking is directed to assess if one needs to sell in the future due to unforeseen circumstances that you will never have expected to happen to you, would the watches save you even though you bought the watches out of admiration rather than as a form of investment. Buying watches as an investment to me is not a wise choice as there are many other true investment options that are profitable.

[esm]

Originally Posted by watchf

You folks are mistaken. Please do not jump on the watches are for wearing not for investing theme the minute you see the word 'resale value'. What I am asking is directed to assess if one needs to sell in the future due to unforeseen circumstances that you will never have expected to happen to you, would the watches save you even though you bought the watches out of admiration rather than as a form of investment. Buying watches as an investment to me is not a wise choice as there are many investment options that are truly profitable.

imo - it is the risk you will have to take in buying anything luxury and hoping one day it will save your backside if you need to sell it.

Rolex is usually pretty good in this regard. i think many people still think Rolex = Money.

depends on what model and how long you have had it.... it final selling price can vary. the condition of the watch and supply vs. demand/market plays big parts of it also.

you can read as much info/case studies online as possible if you wish... but nothing is certain until you have to actually do it (ie. sell for maximum amount of money possible)

[bokmeipai]

If you are worried about finances or a possibility of unforseen circumstances than the only option you have would be to keep your money in an interest earning account. Whether you buy a Rolex or a car even if you were to sell it back the same day you acquired them you would take a big hit. Buying a luxury item is for personal satisfaction not for an investment. As for your example, which is more of a necessity : a car or a watch? Do what makes you happy, life is short. You can always make more money but you can't make more time.

Originally Posted by watchf

You folks are mistaken. Please do not jump on the watches are for wearing not for investing theme the minute you see the word 'resale value'. What I am asking is directed to assess if one needs to sell in the future due to unforeseen circumstances that you will never have expected to happen to you, would the watches save you even though you bought the watches out of admiration rather than as a form of investment. Buying watches as an investment to me is not a wise choice as there are many other true investment options that are profitable.

[tkc324]

I will take the blue pill....

[Watch Professor]

E. All of the above.

[Dan2010]

Originally Posted by Watch Professor

E. All of the above.

But it's a true/false question.

[esm]

Originally Posted by Dan2010

But it's a true/false question.

crap - i thought it was a scenario based/short answer type question

[turboevo2]

It just depends if your buying a new Rolex or not. If you buy a used one and know fairly the value of it then good. If you buy a new one most of the time you have to keep it for long time in order to gain back what you paid for. If next time you need the money and decide to sell your watch it just depends who you sell it too. Rolex is easier to dispose but at what price? If you buy a car definitely depreciation plus you have to pay for maintenance and insurance. On a also you have maintenance but it is cheaper than a car. Overall you need to have a balance in that you can get a nice car and a nice watch without sacrificing too much $$$.

[tdnt]

If you look at the used watch market, the Sub-c holds it's value the best out of all the models that you listed. As for the percent and things like that I don't have any figures because I'm too busy reading all the threads on this forum.

[SC11]

I would say in todays market it would just come down to desirability !

Sub-C are popular at present but can see in time they'll drop down to around GMT mark.

These days Rolex are too mass produced for a true classic to evolve in my opinion, Well maybe the YMII...

The one thing with Rolex is they do not take the hit the majority of other brands do, if you brought walked out of AD and instantly changed your mind you wouldn't take 30-50% hit like you would the others.

But thats just a bit of added security nothing more.

[jeremyam]

Originally Posted by watchf

I need some perspective on some 2 questions from the good folks here.

1) How much would you estimate according to past trends of the resale value in terms of estimated dollars or % of its current price (please indicate if its % of rrp or grey market price) of the below watches in 2, 5 and 10 years time on the used market,

• TT DJ II
• Milgauss GV
• Explorer 39mm
• Sub-C LN

On past trend does the value increases in a linear pattern over time, for example if resale value increases by X in 5 years, it would be about X x 2 in 10 years? In general would the resale value be more or less than its current BNIB price?

2) If you were to choose between two luxury items which you do not need in an objective way, item 1 being a new car & item 2 would be Rollie watches, which one would be a good investment or rather the one you could most justify the spend on if the price on both are almost the same (a new car vs a couple of Rollies)? Lets put the price at say $25k, so either $25k for a car or a number of watches...OR...would you rather have the cash sitting in the bank earning interest?

i'll start where you left off. i would rather have my hypothetical $25k in equities with china exposure with a focus on currency exposure... none of the options you listed above... my time horizon would be 5-7 years.

in general rolex watches go up in value, at what rate, not certain... you can do all the research you want but i think you're time would be better spent working (earning a salary) or not spending money, if you're really concerned with ROI, have a look at some annuities.

[Dan2010]

Originally Posted by jeremyam

i'll start where you left off. i would rather have my hypothetical $25k in equities with china exposure with a focus on currency exposure... none of the options you listed above... my time horizon would be 5-7 years.

in general rolex watches go up in value, at what rate, not certain... you can do all the research you want but i think you're time would be better spent working (earning a salary) or not spending money, if you're really concerned with ROI, have a look at some annuities.

Thats what I said.

[tona-day]

Q1
The price of a used rolex is largely affected by the price of a new rolex (as the two are close substitutes of one another)- therefore if rolex price increases are in a linear or non linear way then it is likely that relationship will be the same for used rolexs.
As to whether that is the case I would argue that rolex sets a % price increase every year and therefore the price of a used rolex will likely increase in a non linear way.
But as to how much that will be by is a guess- and rolex may not be constant in their pricing behaviour in the near/far future.

Furthermore other factors that will impact the market price of a used rolex is how fashionable or desired it is- the more highly desired the more likely the higher used price %wise in comparison to other models- so that is another future guess you will have to make.

Also regarding value you must subtract for inflation every year- given this rolexs are not as good an 'investment' as maybe one thinks.

Essentially your 'investment' is better off in a bond where you beat inflation and receive dividend. What you lose out of this given you bought a watch instead is the premium you pay for wearing it. If the premium is less than what you are prepared to pay then great.

I would say the sub c will retain the most value %wise than the other options.

Q2 a Rolex will generally always outperform a car given price paid new and second hand price. This is especially for luxury cars which depreciate heavily.

But as the other members said- a rolex is a luxury and not something that one generally makes real money on compared to investing that money in an interest bearing bond (which is essentially what we should use as the baseline). If you really want one- get it and enjoy wearing it. And if the money means that much maybe keep it elsewhere; but rolexs are quite liquid and do hold their value reasonably well so there could be worst luxuries to hold capital in.

(btw i study economics and realise that some of what i said maybe slightly technical)

[CashGap]

Originally Posted by watchf

2) If you were to choose between two luxury items which you do not need in an objective way, item 1 being a new car & item 2 would be Rollie watches, which one would be a good investment or rather the one you could most justify the spend on if the price on both are almost the same (a new car vs a couple of Rollies)? Lets put the price at say $25k, so either $25k for a car or a number of watches...OR...would you rather have the cash sitting in the bank earning interest?

If I could answer the first question, I'd be going long and short on various models!

As to the second question (vehicle). Aside from the utility value (transportation) of the vehicle, and your enjoyment, the vehicle depreciates rapidly and permanently unless you are quite lucky. During the first decade, it will consume more than the purchase price in maintenance, registration, storage and insurance. Impossible to look at any new car as an investment.

[RolexWatcher]

I just looked into my proprietary Rolex forecast earnings spreadsheet. It has been backtested with data from the last 1,000 years.

I can now answer your questions.

Originally Posted by watchf

I need some perspective on some 2 questions from the good folks here.

1) How much would you estimate according to past trends of the resale value in terms of estimated dollars or % of its current price (please indicate if its % of rrp or grey market price) of the below watches in 2, 5 and 10 years time on the used market,

• TT DJ II
• Milgauss GV
• Explorer 39mm
• Sub-C LN

Rounded to 3 decimal places (with 0.0005 being rounded up). Numbers are % of current price.

TT DJ II
2 year - 68.475%
5 year - 59.730%
10 year - 65.834%

Milgauss GV
2 year - 71.395%
5 year - 65.813%
10 year - 50.282%

Explorer 39mm
2 year - 93.169%
5 year - 87.671%
10 year - 87.183%

Sub-C LN
2 year - 73.193%
5 year - 93.945%
10 year - 60.281%

Originally Posted by watchf

On past trend does the value increases in a linear pattern over time, for example if resale value increases by X in 5 years, it would be about X x 2 in 10 years? In general would the resale value be more or less than its current BNIB price?

Based on my proprietary 4 factor model, value does not increase in a linear fashion. It is based more on a Brownian motion.

Originally Posted by watchf

2) If you were to choose between two luxury items which you do not need in an objective way, item 1 being a new car & item 2 would be Rollie watches, which one would be a good investment or rather the one you could most justify the spend on if the price on both are almost the same (a new car vs a couple of Rollies)? Lets put the price at say $25k, so either $25k for a car or a number of watches...OR...would you rather have the cash sitting in the bank earning interest?

If I had $25K, I would buy a Rollie (14060M) and go on a scuba diving holiday. RELAX BUDDY!




NB: The above was just for fun. On a serious note, don't buy a Rolex to save your ass. Buy it after you got your house in order (i.e. the more important things in life).

[Grumpy Badger]

Originally Posted by RolexWatcher

I would buy a Rollie (14060M) and go on a scuba diving holiday

NB: The above was just for fun. On a serious note, don't buy a Rolex to save your ass. Buy it after you got your house in order (i.e. the more important things in life).

Glad I did the right thing!

[rolexertion]

Of this you may be sure: Rolexes will show their maximum value when you want to buy one, and then show their minimum resale value when you are forced by circumstances to sell one. Or more.

[pfrench4]

Originally Posted by rolexertion

Of this you may be sure: Rolexes will show their maximum value when you want to buy one, and then show their minimum resale value when you are forced by circumstances to sell one. Or more.

Isn't that always the case...