Are we in a Rolex price bubble

[CyFi]

Hello all,

I’m new to the community. Currently I own a few newer Tudors, and Omega and an IWC. I’m looking into my first Rolex purchase, but am hesitant due to the inflated grey market conditions.

I’m curious in the opinions of the more seasoned members regarding the future outlook of the market (next 1-3 years). I’m hoping that supply will meet the demand at a more reasonable equilibrium in the future.

Cheers and all the best!

Cy

[teck21]

Whatever answer you’re after, you can get here.

Sure it’s a bubble, but no one knows when it will pop.

Rolex does what it does, and even if and when the bubble pops, it could well have moved even further out of reach.

Rolex is nothing like tulips or whatever other bubble people like to bring up.

Thanks to another post, I was doing some research on the GFC’s effect on Rolex.

Nothing but doom and gloom. Rolex ADs surrendered their licenses like a hot potato when Rolex told them to spend money to make Rolex an upmarket brand.

No more middle class nonsense because their spending ability on Rolex watches drops to zero when a crisis comes. A very unreliable consumer segment for their product.

ADs that stuck with Rolex have since profited.

Every crisis has made Rolex stronger. Harder to obtain. More expensive.

“For every 10 clients interested in other brands, we have 50 looking for Rolex watches,” Aurel Bacs, international co-head of Christie’s watch department, said from Geneva. - this was said in 2009, does anyone think that ratio has since improved?



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[Rashid.bk]

Negative. The bubble theory doesn't hold water and it will likely get even worse.
Sucks for new sincere customers who aspire to own a Rolex, there's little to no chance from an AD and most normal people have no idea what buying from a grey even means.

My view is it will get worse, forget about the bubble crap, it doesn't exist except in the minds of dreamers.

Edit: unless you want a Datejust, there's hope maybe, even an OP is now difficult to source.

[Bladeshot]

Originally Posted by Rashid.bk

Negative. The bubble theory doesn't hold water and it will likely get even worse.
Sucks for new sincere customers who aspire to own a Rolex, there's little to no chance from an AD and most normal people have no idea what buying from a grey even means.

My view is it will get worse, forget about the bubble crap, it doesn't exist except in the minds of dreamers.

Edit: unless you want a Datejust, there's hope maybe, even an OP is now difficult to source.

Prices won’t drop anytime soon. And I don’t wish for the correction it would take to make the bubble burst! Be thankful we are where we are, despite a tragic year.

[shaunylw]

Pre Covid, i would have said yes. Post Covid, i think the lack of manufacturing is going to add some time to the bubble. I don’t see significant changes in the availability of most models changing in the next year or two.


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[CastorKrieg]

You straight mention ‘inflated grey prices’ which means as majority you do not care about all Rolex references, or just getting any Rolex, you want the one everybody wants as well. Same with 5711, majority of people do not want any other Patek.

The fact is since GFC we have been running printers more or less non stop, and that went into overdrive with Covid. If you notice all the ultra luxury items are selling like hot potatoes, people made killing on the stock market and now have a lot of money to spend. So of course everyone will navigate to social peacocking pieces. I don’t expect that to change for the most in-demand references whose number will always be kept artificially low in order to move other pieces.

[Gab27]

Welcome! What reference are you seeking/considering?

[russeree]

When everything is inflated.... it's safe to call it inflation. We are at that point now.

[Mrngrz46]

Originally Posted by russeree

When everything is inflated.... it's safe to call it inflation. We are at that point now.

Sorry man but currently we are in deflation.
Ask yourself why bank ask money to keep your money on the acccount

[SS Oyster]

Yes and no

Some watches will shrink back down and some may not. All depends on that pesky supply (Rolex) and demand (us) principle of economics.

Each watch is worth whatever someone else is willing to spend for it.


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[Jimmy66]

A bubble? Hah! Welcome to the word of economic lunacy!

~20-25% of ALL dollars ever created were created in the last ~12 months and it only feels like a matter of time before UBI is implemented.

In this world of stagnating wages, and the cost of capital rising...you have to become an investor, otherwise you are running to stand still. Hence why Rolex watches are now (more than ever) seen as investments. I can't blame people...in a world of negative interest rates, would you rather have a "rare" watch, or watch the purchasing power of your $£€ erode in your bank?

There is a war on savers and the middle class, and it is creating speculators and investors out of people who would never normally be that way inclined.

[CastorKrieg]

Originally Posted by Jimmy66

There is a war on savers and the middle class, and it is creating speculators and investors out of people who would never normally be that way inclined.

Yup, basically the rise of Robinhood and speculation with fractional shares is due to lots of young people wanting to get rich quickly and think they can outsmart the market.

As you mentioned add to that terrible interest rates and there is nothing to put your money in. The only good thing about it - mortgages are ridiculously low, I’m looking at 1% p.a. Whereas my parents were paying 20% 25 years ago.

[thesharpe]

Originally Posted by Jimmy66

A bubble? Hah! Welcome to the word of economic lunacy!

~20-25% of ALL dollars ever created were created in the last ~12 months and it only feels like a matter of time before UBI is implemented.

In this world of stagnating wages, and the cost of capital rising...you have to become an investor, otherwise you are running to stand still. Hence why Rolex watches are now (more than ever) seen as investments. I can't blame people...in a world of negative interest rates, would you rather have a "rare" watch, or watch the purchasing power of your $£€ erode in your bank?

There is a war on savers and the middle class, and it is creating speculators and investors out of people who would never normally be that way inclined.

This is spot on

[SN13]

Originally Posted by Jimmy66

A bubble? Hah! Welcome to the word of economic lunacy!

~20-25% of ALL dollars ever created were created in the last ~12 months and it only feels like a matter of time before UBI is implemented.

In this world of stagnating wages, and the cost of capital rising...you have to become an investor, otherwise you are running to stand still. Hence why Rolex watches are now (more than ever) seen as investments. I can't blame people...in a world of negative interest rates, would you rather have a "rare" watch, or watch the purchasing power of your $£€ erode in your bank?

There is a war on savers and the middle class, and it is creating speculators and investors out of people who would never normally be that way inclined.

I'm glad I'm not the only one who feels this way....

[henrylee]

Someone asked this several years ago but now there’s less stock. Unless Rolex manufactures more watches, which they won’t and can’t, this is the new norm.

[brucethemanlee]

nope

[Uggi]

I recommend you disbelieve anyone who claims to know the answer to your question with any certainty.

[Nairn1980]

Originally Posted by CyFi

Hello all,

I’m new to the community. Currently I own a few newer Tudors, and Omega and an IWC. I’m looking into my first Rolex purchase, but am hesitant due to the inflated grey market conditions.

I’m curious in the opinions of the more seasoned members regarding the future outlook of the market (next 1-3 years). I’m hoping that supply will meet the demand at a more reasonable equilibrium in the future.

Cheers and all the best!

Cy

I predict they won’t get any cheaper.
If you want something, you might as well buy it now (grey). If you can’t get it from an AD now, I don’t see that changing.

[tanask211]

The bubble won't burst as long as there is a huge demand. Even a OP41 is selling almost doubled in grey market.

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[Boaters]

Hey Cy welcome to the forum. And guess what you know as much as we do. Jump on the wagon and take a ride but hey don't forget your wallet.

[Fleetlord]

Too many ways to obtain substantial money "easily" these days....

Ways not possible 20yrs ago. Social Media stardom, Bitcoin speculation, Fantasy Sports grinding, Competitive Video Gaming!!!...all can be very, very lucrative...and the cash flows readily once you get the system going.

What to do with that money? Buy Rolex! DO NOT MISS OUT!


Rolex has positioned themselves to be "wanted" and a landing spot for this money. That's their secret sauce. The other watch brands? They are mostly getting left behind. It must drive them crazy...the watch market being so HOT but they can't take part due to prior marketing missteps and overproduction.

New economic forces that aren't fully understood are in play.

[Boaters]

Originally Posted by Fleetlord

Too many ways to obtain substantial money "easily" these days....

Ways not possible 20yrs ago. Social Media stardom, Bitcoin speculation, Fantasy Sports grinding, Competitive Video Gaming!!!...all can be very, very lucrative...and the cash flows readily once you get the system going.

What to do with that money? Buy Rolex! DO NOT MISS OUT!


Rolex has positioned themselves to be "wanted" and a landing spot for this money. That's their secret sauce. The other watch brands? They are mostly getting left behind. It must drive them crazy...the watch market being so HOT but they can't take part due to prior marketing missteps and overproduction.

New economic forces that aren't fully understood are in play.

Perfectly said especially with the new wealth crypto bitcoin I only see higher prices and longer wait times IMPO.

[turkeysub93]

Originally Posted by Fleetlord

Too many ways to obtain substantial money "easily" these days....

Ways not possible 20yrs ago. Social Media stardom, Bitcoin speculation, Fantasy Sports grinding, Competitive Video Gaming!!!...all can be very, very lucrative...and the cash flows readily once you get the system going.

What to do with that money? Buy Rolex! DO NOT MISS OUT!


Rolex has positioned themselves to be "wanted" and a landing spot for this money. That's their secret sauce. The other watch brands? They are mostly getting left behind. It must drive them crazy...the watch market being so HOT but they can't take part due to prior marketing missteps and overproduction.

New economic forces that aren't fully understood are in play.

A lot of very good points.

Also take into account the how many payment channels are available...credit limits are bonkers...0% financing through the likes of PayPal, Affirm, and many other vendors...accessibility of luxury goods has never been higher.

[Robf52]

New economic forces that aren't fully understood are in play.[/QUOTE]

From a US perspective, we do seem to be entering uncharted waters in terms of government deficit spending and wealth inequality and currency devaluation. Where it ends or leads is anyone's guess. My take is it will not end well. I think a move to hard assets as a potential safe harbor is directly benefitting Rolex who is universally recognized as an enduring and stable brand.

[Tensai]

No.
Zzzzzzzzzz.....

[matt123]

I think we are probably in a bubble of everything (stocks/property/bitcoin/art) and rolex is just a part of everything being at all time highs. However, if there is a rolex bubble my view is that by the time its gone you will be paying current grey prices anyway.

For example, if it takes 4 or 5 years for the bubble to pop and rolex does a 7% price increase every year then by the time you can get them at retail, retail will be significantly higher than it is today.

[mic6]

"Rolex bubble". There is no such term in human history.

[AK797]

Bubbles refer to free-ish markets with liquidity and efficiency and regulation, the watch market is not like that at all so a sustained monopoly over both the retail and grey market can exist for years and years with such high barriers to entry and with all conquering social media continuously fuelling increasingly inelastic demand and greed and conspicuous consumption of Hyped Veblen Goods.

[Giangos]

Welcome.

My advice to you is this. You will never come across a better time to buy a Rolex, either from an AD or grey. Today, they will be cheaper to buy than next week or next month or next year.

They are only going one way. Anybody waiting for the bubble to burst and the market to be flooded with cheaper watches is just dreaming.

Buy today, or pay more tomorrow.
Good luck!


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[mic6]

Originally Posted by Giangos

Welcome.

My advice to you is this. You will never come across a better time to buy a Rolex, either from an AD or grey. Today, they will be cheaper to buy than next week or next month or next year.

They are only going one way. Anybody waiting for the bubble to burst and the market to be flooded with cheaper watches is just dreaming.

Buy today, or pay more tomorrow.
Good luck!


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This.