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7 Jun

Investing In Luxury Watches – Fact or Fiction?

The allure of luxury watches has transcended generations to captivate collectors and enthusiasts alike. These pieces are not just functional but also symbols of excellent craftsmanship, rich heritage, and prestige. But beyond their aesthetic appeal and status, there’s a growing debate around their potential as investments. Can luxury watches be truly considered a viable investment? Or is this more fiction? Let’s find out.

Rising Popularity of Luxury Watches

  • Exceptional Quality & Craftsmanship

Luxury watches are synonymous with exquisite craftsmanship. Master watchmakers spend hours and days meticulously assembling each fine timepiece. The precise engineering, attention to detail, and intricate movements that go into the making of each luxury watch distinguish them from mass-produced options. High-end watchmakers only use premium materials to craft the pieces, contributing to their enduring value.

  • Scarcity & Exclusivity

Limited production and exclusive models drive up market scarcity, increasing demand and value for the watches. Collectors and enthusiasts are often willing to pay more for a popular model that is no longer in production.

  • Brand History

Renowned watchmakers with a long history and reputation have loyal followers. Watches from these brands are seen as the epitome of elegance and timelessness, maintaining or even increasing in value over time.

Advantages of Investing In Luxury Watches

Investing in luxury watches has a wide array of benefits for investors and collectors. Here are some of them:

  • Tangible asset

Unlike stocks or bonds, luxury wrist pieces are tangible assets. You can see, touch, wear and enjoy your investment while it holds or even appreciates in value. This physical presence provides a sense of security and confidence.

  • Durable

Luxury watches are made with high-quality materials and are built to last. With proper care and maintenance, the watches can run smoothly for generations, often outlasting any other investment forms.

  • Unaffected by inflation

As seen many times, the value of luxury watches often remains stable or increases during inflation, protecting your investment. Unlike other traditional forms of investment that get impacted when the value of currency goes down, luxury watches remain unaffected.

  • Value appreciation

One of the main reasons enthusiasts are choosing to invest in luxury watches is that they appreciate in value over time. Limited edition models, rare pieces, and watches with rich histories are known to perform exceptionally well on the pre-owned market, making them lucrative investment assets.

  • Status symbol

For many, owning a luxury watch is a symbol of status and prestige. Therefore, investing in one provides not only financial value but also intangible benefits.

  • Diversification

Relying solely on other forms of investment can be risky. It’s advisable to invest in luxury watches to diversify your portfolio, balancing them with more traditional assets like bonds and stocks.

Factors that determine the value of luxury watches

Embarking on investing in a luxury watch requires careful consideration of various factors, each of which directly impacts the resale value of the timepiece. Here are the unique aspects:

  • Watch Brand

If you’re looking to buy luxury watches to resell them later, you’ll ensure you get a good return. In that case, the brand of the watch plays a vital role in deciding its investment return. A brand with a rich heritage and good reputation will hold its value better than others. Not all watch brands are made equal or hold similar value.

Watches from luxury watch brands like Rolex, Patek Philippe and Audemars Piguet are always in demand and are more likely to retain and increase in value over time.

  • Scarcity

The simple fact that a watch is rare adds to its credibility and value. Look at the production number of the watch that has caught your attention. Limited edition, rare, or discontinued models usually hold their value better over time. Also, many vintage luxury watches, like the Rolex Daytona or the Patek Philippe Nautilus, are becoming increasingly difficult to find.

Research the demand for watches and scarcity in the market, as the demand is usually high for them in the secondary market.

  • Provenance & History

A little research goes a long way in the luxury watch industry. Watches that the aficionados have given nicknames are the most important. They are collection or investment-worthy timepieces, whether due to their unique colour combination, dial design, celebrity influence, or any other special attribute. For instance, models like the Rolex ‘Batman’, ‘John Mayer’ Rolex, Audemars Piguet ‘Royal Oak’, etc.

These watches have a rich history and, hence, draw more attention to the market. The rule is simple: the more demand there is for a particular model, the higher the price you get for it.

  • Materials & Complications

Some luxury watches are classified as ‘complicated’ because of their unusual features and functionalities. But it is the unique features that make the timepieces so coveted. For example, watches with perpetual calendars, tourbillions, moon phases, split-second timers, and many others are coveted.

The watches are crafted using precious metals and materials like stainless steel, platinum and gold, all of which add to their appeal and value, making them an excellent investment.

  • Condition

The condition of your luxury watch determines its selling price. A new watch in poor condition won’t necessarily fetch you a higher price. On the other hand, a vintage model in excellent condition will drive an impressive return.

Alongside, the condition, a timepiece in its original state (with the original parts like dial, bezel, crystal and bracelet) will always be valued higher than any aftermarket component.

  • Market Trend

Market demand and trends play an important role in deciding the resale value of a luxury watch. For example, if a celebrity wears a particular timepiece at a well-known event, the watch’s value will increase considerably. However, the watch could lose value when the trend fades away.

It is recommended that some prior research is done before investing. Pick watches that have historically shown an increase in their resale value, such as any popular model from Patek Philippe, Rolex, or Omega.

Buying The Right Watches!

Now, after all is said and done, and we’re partially assuming that you’re convinced about the investment aspect of luxury watches, let’s address the main part—buying the right watches!

Below, we’ve listed the top luxury watches that consistently generate consumer demand thanks to their strong brand reputations and quality craftsmanship.

5 Best Investment Watches Of All Time

1. Rolex ‘Daytona’

The Daytona is a classic and highly desirable Rolex in production since 1963. The watches have a simple yet striking design, featuring a stainless steel case, bracelet, and bold black dial. The latest models are available in various materials, including steel, platinum, and gold.

If you’re looking for a classy sports watch as an investment, the Rolex Daytona is a great choice.

2. Patek Philippe ‘Nautilus’

With its iconic design, limited production and exceptional craftsmanship, the Patek Philippe Nautilus has become a lucrative investment option for collectors worldwide. The Nautilus is a true icon and has proven to hold its value well over time, with models even experiencing appreciation in value.

The Nautilus has undergone small transformations over the years, but its prestige has only risen.

3. Omega ‘Speedmaster’

Known as the ‘Moonwatch’, the Omega Speedmaster was the first wristwatch to land on the Moon. Upon its trip, the watch instantly became iconic and in demand. This Omega Professional Moonwatch features a classic black dial and a robust steel body. Its historical significance, precision and design have helped it maintain a high resale value over time.

Well, the prestige of wearing an Omega Speedmaster “First Omega in Space” says enough.

4. Audemars Piguet ‘Royal Oak’

Gerald Genta’s iconic design of the Audemars Piguet Royal Oak revolutionised the industry in 1972. The Royal Oak features a striking octagonal bezel with eight visible screws and a finely textured tapisserie dial, giving it a distinctive appearance. The watches are made of precious materials like steel, gold and platinum, contributing to their longevity and desirability.

The AP Royal Oak’s limited availability makes it an excellent investment in luxury watches.

5. Cartier ‘Tank’

Introduced in 1917, the Cartier Tank is one of the most loved watches of all time. Its unique design, featuring a rectangular case, bold Roman numerals, and a signature blue cabochon, makes it popular among world leaders, collectors, influencers, and the Royals. While the Tank has received numerous modifications over the years, the essence remains the same, making it so popular.

Celebrity associations have helped the Cartier Tank become a sold investment watch.

The Right Time To Invest Is ‘NOW’

If you’ve been in two minds, unable to decide whether it’s the time to invest in luxury watches, here are some key reasons why you should take action now!

Resilient Market: During periods of market volatility, luxury watches have shown resilience like none other. Amidst the economic climate, market fluctuations, and rising inflation, luxury watches have maintained their value better than any other investment type.

Increasing Demand: The demand for luxury watches, especially Rolex, Patek Philippe, Audemars Piguet and Cartier, has grown exponentially, driven by both seasoned and new collectors. This increasing global demand can drive up prices and enhance the investment potential like never before.

 Social Trends: A growing appreciation for vintage and luxury items is driven by a shift towards valuing quality and heritage. Luxury watches fit well into this trend and this shift can enhance the desirability of luxury timepieces as investment assets.

Limited Supply: Investing in high-end watch models that are rare, discontinued or have been produced in limited numbers can fetch high premiums. These models are scarce in the market, leading to their future value appreciation.

Final Words

As investing in luxury watches straddles the fine line between fact and fiction, more and more people now consider them a reliable investment option. While the watches hold potential for appreciation, it is important to move forward with a discerning eye, a long-term perspective, and market knowledge to reap the investment benefits.

Ultimately, it all boils down to whether one considers luxury watches an investment or just a beautiful indulgence.

For those passionate about investing in high-end timepieces, check out Luxbrokers’ vast selection of pre-owned luxury watches from reputed brands like Rolex, Patek Philippe, Cartier, Omega, Audemars Piguet, and many others. We boast many luxury watches, including popular models that guarantee a financial return. Check out the collection online, or feel free to visit us in-store.

Call 0207 123 5081 for more information.

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