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Buying A Large Second Hand Stone

Mrs Denison

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My husband and I have an acquaintance trying to sell a diamond "appraised at over 31,000!" She says the center stone is 2.01c, and the smaller stones amount to .60c . It is a G, VS2. She has dropped her price, over and over, because her divorce has left her broke. We live in a very small town, so I suppose, time is against her.


We are considering purchasing it from her. She had it appraised at the jeweler she bought it from, and has that paperwork, but it seems like a jeweler selling it might up the price? I have considered asking her to send it to GIA for paperwork there. Is there a smart way to go about all of this to make sure we are not taken advantage of?


Edited by Mrs Denison
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Is there a smart way to go about all of this to make sure we are not taken advantage of?


Yes. Hire your own appraiser. ‘Appraisals’ provided by sellers as part of an advertisement are notoriously unreliable. Even ignoring the value conclusion, you have stated as fact that it’s a 2.01cts./G/VS2 with no other information at all about the stone. Presumably the source of this information is this same appraiser. It’s terribly important.


The value conclusion is another problem area for people reading appraisals. Any statement of value must contain an element of what it’s worth to whom, when and under what circumstances or it’s not useful information. Without it, it’s pointless even if it were somehow turn out to be correct. Is the store saying that this is what THEY would charge for it or are they estimating prices for some hypothetical competitor who, presumably, charges more than them? Obviously she is finding it difficult to get $31k or she wouldn’t be talking to you about it and obviously the jeweler can’t get that either or they would be making a deal to sell it for that, collect a well deserved commission and everyone would go away happy so this isn’t the value definition. What is? Usually it’s something like ‘insurance purposes’ without any further explanation but the details will be in the fine print of the appraisal. If it’s not there, ignore the document entirely. If it is there, and you don’t understand what they mean, call up the appraiser and ask them. Bear in mind that this appraiser is working for her, not for you, and you should judge their opinions accordingly. It’s like going to court and relying on what the opposing council has to say.


I would not start with sending it to GIA. GIA will only inspect unmounted stones and the process of pulling and resetting a princess cut is a bit risky. You, as a potential buyer, shouldn’t be getting into this. That’s the sellers job. Hire your own expert to grade it in the mounting and assume for the worst. Ignore her appraised value and use the advice of your own expert to generate a bid. If the grader says G-H, bid it as an H. If they say VS2-SI1, bid it as an SI1 etc. If she doesn’t like your assumptions and wants to provide GIA as a counteroffer, let HER pull it and send it in. It probably will increase her ability to sell it if she does this but it is a bit of a pain, comes with some risks and some costs and takes a month or so worth of shipping and such. How to maximize her sales potential is her business, not yours and, presumably, HER experts should be providing her advice on this.



Edited by denverappraiser
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Neil's advice, as usual is spot on.


In addition to the fact that the "Appraisal Value" is totally meaningless, here's a point about pricing:

When purchasing a diamond from a private individual, the price should be substantially lower than what you could buy the same item for from a full service seller. If you buy from a store ( either online, or in town) you should be getting a money back guarantee, workmanship guarantee, and possibly a trade up privelidge.

Once you pay the private individual, you're on your own...... in other words, if it's not a total bargain, don't buy it.

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Thank you for your council. To address the "bargain"... she is asking 10.5k for the ring. I'm not certain if its a bargain or not, because obviously I've not had it appraised for myself. I fully intend to make the best use of your advice, though.


I don't know how difficult it is to turn around and sell diamonds, but she claims to need the cash quicker than she can get it. If we do purchase this ring, I doubt it would be to keep it. I have a ring I'm very happy with, and I'm not in the habit of just keeping pricey jewels around. We will not be in a rush to sell, as our friend is, but where would we begin selling it in the first place? I assume any bargain to be struck with a jeweler around here is less than stellar or, as stated before, our friend "wouldn't be coming to me."

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Ah, it’s a business venture.


There’s a utility at the top of the page titled ‘find online jeweler’ that might be educational. Use the database to look up stones that are similar to yours. Figure you’ll be able to realize something like half to ¾ of the prices asked for here. Expect nothing of consequence for the mounting.


For arguments sake, assume that G means H, maybe I. Assume VS2 means SI1. Search the database for 2.00 – 2.10cts. and ignore everything except stones with GIA and AGS grading The cheapest GIA I find at the moment is a 2.01/H/SI1 being offered for $10,430 with a lot of superficially similar stones in the neighborhood of $12-$13k. This makes your private resale potential something like $6k-10k depending on details we don’t have, less if it’s damaged or if the grading is worse than I’m expecting.


We’re making some serious assumptions about the grading and, as David points out, you’re going to have no recourse if these turn out to be false so it pays to be conservative.


If you’re going to expect to sell it for $8k, what do you want to pay to make it worth your trouble, risk and expense? $5k? $7k? That’s up to you but it will surely be less than the $10k she’s asking. Pass.



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I have a better idea, could you sell it for her and get say 10% comission on whatever the sold price is? Find her a buyer instead of being that buyer and trying to flip it for a profit, a risky move.


Another option is to just have her put it on ebay. Help her with this, take huge, professional pictures and charge a small fee based on what it sells for.

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