First, it should be said that watches should not be thought of as an investment. You should buy what you love; however, no one is ever disappointed if their timepiece is retaining its value. Spending a good amount of money on a luxury item can make you wince when you see the bank account. A pain that can be lessened knowing it will sell for a similar price to what you paid. Not all watches hold a majority of their value, but many will. Some will even end up being a good investment and increase in value over time. While no one can predict the future of prices, here are some things to look for if you want to increase the chances of a buying a timepiece that will retail its value for years to come.
The materials a watch is made from is the only thing that can define its value outside of the watch world. If a watch is made from gold or platinum, it will always be worth its weight in these materials. Every other factor that goes into the value of a watch will have to do with what is popular and fashionable. These factors have nothing to do with the intrinsic value of the watch. The downsides are that these same watches will cost more initially over the steel counterparts in almost all cases, and if precious metal is not in vogue, it will have possibly the least impact on the overall value of a watch.
Well Established Brands
If a value of a watch is primarily based on how fashionable and in demand it is, then it is best to start with fashionable and in demand brands. Not the ones that are hot at the moment, but the ones who have historically been a popular brand. This is where Rolex is king of the land. Rolex is one of the most well-known brands in the world in or out of the watch industry. People who know nothing about watches know a Rolex is a luxury timepiece. This cache’ helps all Rolex watches retain most, if not all of the initial value. They are not the only ones with a historically strong value retention, as one moves up market. Patek Philippe and Audemars Piguet have not only held their value but usually become a strong investment. As the watch industry has seen a resurgence in the past few decades, more brands have seen not only new models retain most of their value but also the older models from the brands. OMEGA, IWC, Jaeger-LeCoultre, and Vacheron Constantin were all founded over a century ago, this strong foundation helps the market trust they will be around and retain enough popularity to retain the value in their product. Generally, the stronger the brand history, the more likely it will retain its value.
Well Established Models
If a strong brand helps the value of a watch, then a strong model in the brand will help even more. No one has ever lost money buying a Rolex Submariner, it has never gone down in value over time. That is the definition of a safe bet in the watch world, it is the most recognized brand and the most recognized model. OMEGA Speedmaster, Patek Philippe Nautilus, Audemars Piguet Royal Oak, and Jaeger-LeCoultre Reverso are each icons of well established brands. This stability of a model within a stable brand brings more attention to the watch and the more people know a model the more it will retain the value.
Unusual Version of That Well Established Model/Brand
We are zooming in to a smaller and smaller circle going from a brand, to a model, to the rare version of that model. Each time the number of watches made of each type gets smaller and smaller, letting good old supply and demand work its magic to keep the value of a watch from going down. A Rolex will keep its value, a Rolex Submariner is a safe bet within the brand, A green bezel 16610LV is an even better choice as not as many were made, but a flat four version of the 16610LV is the rare item that a collector wants. If a watch has a limited production this may increase its value, but if it is a limited production within a very popular brand and model it is almost guaranteed to be a good place to put your money. If you want the extreme example, check out what happens when Patek Philippe puts a rare version of the popular Nautilus model up for auction.
So, with value coming down to popularity, the question is: do you buy the hype in order to increase the chance of value retention? I will always say emphatically no. Buying what you love will make you happier in the long run, and buying what you can afford means not having to care if a watch keeps its value. Sometimes the hype around a watch does not last. Franck Muller was a very popular brand in the late 1990’s but as fashion changed, so did the value of the brand’s watches in the aftermarket. If you bought a watch from them thinking you could always sell it and get your money back, I am sorry for your value loss. Newer hyped brands like Richard Mille have seen an explosion of value at the very high end, but they are very niche in price and look. If this small audience changes its mind on what it finds to be the “in” thing, I would expect to see some more affordable Richard Mille’s hit the aftermarket.
All of this can be summed up easily if you are thinking about value retention, then go for something with a long history of being popular and not the new hyped watch. But first, buy what you like and can afford. If you do that you will never regret a purchase no matter the resale value.