Value retention

[brandrea]

As soon as you start viewing watches as investments or a value retention play ... you suck the joy out of ownership and this hobby IMHO

[steeevvvooo]

FFS. Watches are luxury goods. If you want an investment then speak to an investment advisor/retirement consultant etc.

Rolex, and any luxury watch IMO, should only be bought with disposable income. If you NEED to sell at some point in the future then God help you. The exits will likely be blocked by hundreds of thousands of people worldwide trying to exit at the same time.


Read up on Minsky.

We are at stage 4...

https://www.investopedia.com/article...f-a-bubble.asp

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[supacarrot]

Originally Posted by Hawkeye1

One of the main reasons people by Rolex is that they hold their value better than most brands. That said, when one purchases one on the secondary market and pay the premium, you're pretty much committed to that watch because the second you sell it, you're most likely going to take a loss. I'm in a constant struggle with instant gratification and common sense. Reading the Maui post below, I want to fly there tomorrow to buy $10k in jewelry so I can get that Sky Dweller!
In people's experience, do gray market prices hold up over time?

Grey prices for current stainless steel most likely will not unless Rolex hikes prices aggressively (which might be the move). In the past I usually think of Steel Rolex models as holding around 80% of MSRP +/- 15% or so. Gold maybe 70% +/-20% depending on the model.

Rolex holds VERY WELL against retail compared to most other brands. I would probably never buy an Omega, Cartier, or Breitling new in store. For many models you can easily get them two months used for half MSRP or less. I picked up a 23,000 Breitling transocean in rose gold that was beautiful for 8750. When I wanted to sell towards a gold AP/Rolex I was hard-pressed to find a buyer above 7k. Thats 30% retail...

If you plan on trying new things every so often, stick with watches that hold their value like Rolex or try to buy gently used models at deep discounts.

[supacarrot]

Originally Posted by Catatafish

I don't buy it as an investment, I buy it as a luxury good. Having said that, I'm never going to buy ANYTHING that I know is instantly a big loss should I need to become liquid due to some emergency I didn't plan for.

So yeah, how it retains it's value matters to me. But not because I'm confused about what "investment" means. Rather because I understand that shit happens in life, so I'm no way going to pay an Omega dealer 10,200 for a watch that will sell for 6k the very next day with the tags still on it. With Rolex there's less risk to this, and I prefer to purchase the Rolexes (Rolexi?) that will do this the least. I think there's a lot of people that think that way, they're just misusing the word investment which triggers a lot of people.

"misusing the word investment which triggers a lot of people"

This!

Pretty sure this thread is about being able to switch to a different watch for about what you put in, not trying to make money.

[Mystro]

Originally Posted by shapiroeric

Watches are like cars....buy it if you want it, use it, and don’t worry about future value....this place is worse than the car forums about what prices will look like in a year or 5.....it’s a watch, a piece of metal that tells time....not an investment or money storage unit.....


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X4
If you even notice a few grand either way with a watch then you are totally missing how a luxury lifestyle is lived.

The big issue with Rolex is non enthusiast are buying them and when they get tired of it or it is no longer in vogue (that will happen), Rolex watches will go on a massive price dump. Think Harley Davidson in the late 90’s. Never before has Rolex seen this kind of artificial market value so all the rules we used in the last 30 years with Rolex will not apply. This will include the $12,400 msrp Daytona.

[Hawkeye1]

Originally Posted by supacarrot

"misusing the word investment which triggers a lot of people"

This!

Pretty sure this thread is about being able to switch to a different watch for about what you put in, not trying to make money.

I 100% agree with both of you. Just to be clear, I am not under the illusion that Rolex or any luxury goods are considered investments, nor am I hoping to flip the steel blue Sky Dweller that's I'm day dreaming about. I guess I was just curious to see if people thought secondary market prices depreciated at the same rate or amount as retail prices? But really a moot point, because if I do end up with it, I don't plan to get rid of it. (unless I change my mind a year later and want a Daytona instead )

[afjag256]

It is model specific, and no one has a crystal ball. What is hot now may not be later. Same for the economy.

[dtwer]

Originally Posted by supacarrot

Rolex holds VERY WELL against retail compared to most other brands. I would probably never buy an Omega, Cartier, or Breitling new in store. For many models you can easily get them two months used for half MSRP or less. I picked up a 23,000 Breitling transocean in rose gold that was beautiful for 8750. When I wanted to sell towards a gold AP/Rolex I was hard-pressed to find a buyer above 7k. Thats 30% retail...

A couple of years ago a friend of mine tried to trade in his very gently used IWC and Breitling when he bought his BLNR. The AD offered him such ridiculously low trade value that they might as well be telling him no.

[steeevvvooo]

A few people talking about omega and other brands losing so much money as they leave the store. If you are that worried about buying a 10k Omega that is "worth" 6k waking out the store simply buy it for 7k from a grey dealer instead. The retort will be "I want my name on the papers" etc... Fine, but that sounds like a keeper to me and you shouldn't worry so much about resale then.



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[SkyJuice]

Originally Posted by ak797

this hobby isn't about value retention, it is about buying and wearing watches you love, if you worry so much about value retention just retain your wallet to the closed position. Done.

+1

[jimcameron]

Originally Posted by Hawkeye1

In people's experience, do gray market prices hold up over time?

For gray market sellers. For consumers? Not so much.

[CashGap]

I'm going to Paris and Prague soon with my wife, flying first or business class all segments, staying in premium hotels.

Because I'm a conniving manipulator of the credit card points systems, I'm probably out of pocket $3,000 all in.

What's the resale value on that? $0.00.

I think I paid $1,349 for my iPhone XS 512gb one year ago. What's the resale on that? $580.00 today. Which I find incredible, that the secondary market is so strong. Primarily because of the long software support life and inherent build quality.

What I, and many others, are trying to say is:

1 - Don't think you are going to buy a Rolex today with no special connections, wear it three years, and sell it for a gain. IT HAPPENS... but it's not predictable.

There is a lot of smart money playing in this arena and I happen to know none of my money is the smart money. A wise man once said "In the battle between you and the world, bet on the world".

The people who can consistently MAKE money in the Rolex buy/sell game aren't asking which references will go up on forums.

2 - Feel a little better about these purchases than many luxury purchases.

You're going to put your name on the card, size it, walk out, and know that if you want to turn it into CASH tomorrow... you're looking at perhaps a 25% hit (varies WILDLY especially in these strange times... certainly not the case if you lucked into a BLNR at MSRP, certainly the case if you paid a premium over MSRP). Wear it three years? My crystal ball isn't working... but the most likely outcome is that, depending on the reference, how you bought it, and what happens next, resale will put you anywhere from -40% to +20% all in. That's a pretty broad range...

3 - From Rolex.org (not .com)

PERPETUAL IS MORE THAN A WORD ON A DIAL

Perpetual. For nearly a century, the word has been written on every Rolex Oyster watch. But Perpetual is more than a word on a dial. It is philosophy - an unceasing quest for excellence, to explore and to share human knowledge to build a better world.

It is based on a fundamental belief in unlimited human potential, in continuous improvement, in always pushing the boundaries and taking the long-term view. Our watches are built to last. So is our contribution to future generations.

I bragged on the iPhone resale value, which is unique in it's universe... consumer electronics. But no doubt... If I find a ten year old iPhone today, I may examine it curiously but am more likely to throw it in the garbage. Someone finds a Rolex forty years from now purchased today, they are likely to wind it, put it on, and enjoy it. At worst, they'll seek out an independent shop to get it back to perfect performance.

[brigadoonb]

Buy to enjoy it...and leave the "investment" aspect out.

Might want to look for something that instills more passion.....once you find that, then these questions wouldn't even come up.

[CashGap]

Originally Posted by brigadoonb

Might want to look for something that instills more passion.....once you find that, then these questions wouldn't even come up.

Nailed it. And unlike SOME passions, it's not financially devastating if your tastes shift.

[Butchh]

Originally Posted by AK797

This hobby isn't about value retention, it is about buying and wearing watches you love, if you worry so much about value retention just retain your wallet to the closed position. Done.

I’m with AK...I buy what I love, value retention doesn’t concern me. Pleasure plus great functionality equals a happy me...

[CashGap]

Originally Posted by Butchh

I’m with AK...I buy what I love, value retention doesn’t concern me. Pleasure plus great functionality equals a happy me...

I have to admit, the fact that there is SOME value retention does make it easier for me to open my wallet.

[TreiseKL]

Originally Posted by CashGap

I have to admit, the fact that there is SOME value retention does make it easier for me to open my wallet.

True. Not everyone here would enjoy Rolex as much without the longest history of value creation that Rolex has enjoyed