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Help Diamond Newbie


diamondsellernewbie
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Hello all - stumbled across diamond review from a google search and the community here seems really knowledgeable and helpful so I signed up hoping to get some help.

 

I'm looking to sell a diamond engagement ring, and having never sold a diamond before, had a few questions.

 

First, about the ring - it has a GIA certificate, the diamond is a 1.5ct, oval, D, VS1. Based on the research I did for retail prices for such a diamond, it seems it should fetch between $18k to $25 retail, and that's without the smaller diamonds surrounding the stone, the smaller diamonds at the top of each side of the ring, and the platinum ring itself.

 

I'm struggling to find the best place to sell the ring and get the most value for it. I know I won't get very close to the retail price for the ring, and that retail stores are not the best option as they seem to be quoting me 25%-50% of the retail price.

 

Specifically what I would like to know is:

 

1. In your expert opinion, what should my realistic expectation be for how much I could sell this ring for?

 

2. Does the fact that it's an oval shape really reduce the value by much? And if so, how much?

 

3. What do you recommend is the best way to get the most value for the ring? eBay does not seem like a viable option for a ring of this value (at least not from the listings and results that I found), diamond retailers are offering around $7 - $10k, and on consignment it's been sitting unsold for over 2 years.

 

Would really appreciate everyone's help with this!

Edited by diamondsellernewbie
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25-50% of ‘retail’ may not be unreasonable. It depends on the details.

 

What you are asking boil down to fashion and salesmanship, neither of which are gemological properties. Ovals are not popular right now. That’s just the way it is. Dealers like to fill up their cases with things that sell quickly for them. That’s just good business. It’s not like diamonds are perishable, and fashions change over time, but this is the reason you’re getting lowball bids form dealers. Will you be better at retailing it yourself? Who knows? That has at least as much to do with you as with the ring. Ebay is a popular venue for folks who are good at it but it’s a problem for inexperienced sellers. Craigslist works if you’ve got a high tolerance for creeps and wierdos. Lots of jewelry stores and websites will take consignment if it’s the sort of thing that they can sell and this mostly has to do with the styling of the piece. Unfortunately, consignment has a few traps as you’ve discovered. Since the jeweler doesn’t have any ‘skin in the game’, they have little incentive to push yours rather than something they own and that comes with a better margin. If a client wants it, they’ll sell it, but it’s not likely to be featured in their advertising. You are also in the position of being a business partner with the jeweler. You have to care if they’re still in business, if they pay their bills, etc. It’s up to you to decide if this is worth it and it comes down to what they are doing for their money. Some do a lot more than others.

 

In general, people don’t like to buy ‘used’ engagement rings. It's a symbolism thing. Instead they want to take the stone out and make their own thing with it. This means that for a significant fraction of your potential customers the ring mounting doesn’t add much to the value beyond the recycling value of the materials.

 

I’m not going to take the time to look up comps since you said you already have but $18k-25k seems a little high as an estimate for retail. I’m sure there are stores out there who would ask that, and a few might even get it, but just like you are finding, asking isn’t the same as getting.

Edited by denverappraiser
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@denverappraiser thanks for helpful and informative as usual response.

 

The research I found on retail prices was for a round diamond, so you're right in that those prices would probably be a little lower for an oval diamond (I actually couldn't find any oval diamonds for sale in my research, probably because they aren't popular like you mentioned).

 

I've sold a few things successfully on eBay, so may give that a shot, but the vast majority of listings seem to be for much, much less, and I'm not sure if a good listing (large, good photos, lots of information, photo of certificate, etc.) would overcome the inherent limitations of selling rings of high value on eBay.

 

I had a couple of follow-up questions I was hoping you could help me with:

 

1. Do you think auctioning the ring though Sotheby's or Christie's is a viable option?

 

2. This may be a subjective question, but given the low odds of selling through consignment (although we've currently got it with a very reputable, popular retailer, and they are marketing it as new not used, they're definitely not featuring it and I agree that most people want to build their own ring) would I be better off leaving it with a retailer and hoping for a sale, or trying to get 50% of the retail price and moving on?

 

I know there's not always a right answer to this, but just wanted to see if you had any thoughts given your experience. I should mention that I don't have any short term needs for the cash, so don't mind waiting, just don't want to wait for another few years and then take the 50% of the retail price then.

 

Thanks in advance for all of your help.

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A casual search in the database here for 1.50-1.60/D-E/VS1/Oval/GIA produces 13 stones ranging from $10,400-$16,100 asking price. Median seems to be about $13k or so. That's retail, albeit from fairly cheap vendors. 50% of retail puts you at $6,500. The link's at the top of the page under 'diamond finder'. You can search for yourself. If what YOU mean by 50% of retail is 50% of $25k or $12,500, that's the problem right there. I think you will be hard pressed to find a store that will give you anywhere near that. And that's with you thinking they're ripping you off! :(

 

That's right in line with your ebay observations. Ebay is tricky for comps by the way and it's a pool of sharks. There are some good dealers there but you can't easilly tell if they are accurately describing things, if they're actually getting their asking prices, if they actually deliver what they say, etc. It's usually chock full of people who ask the moon and just keep on relisting it till they get tired of paying ebay fees. It's money for nothing for ebay so they don't care, list all you want and ask whatever you like. Your results may vary.

 

Sotheby's takes about 40% in commissions when you include the buyers premium and they charge a few hundred in cataloging fees and the like. There's something to be said for them because they're good at building a 'buzz' if the piece is cool but they generally do higher end items than this. You can ask them but I doubt they'll take it and I wouldn't expect them to be able to drive up the prices much, again unless it's a reallly killer piece or it has some really interesting provenance. If they only get $10k plus the premium, they're going to pop you for 25% and another $500 in fees, you go home with $7k, which isn't really much progress. They do have competitors, like Heritage in Texas and Bonhams in California that may be a better fit but they're all pretty pricey.

 

The right consignment shop will probably eventually be able to sell it but it's up to you to decid if it's worth the grief. If they're asking $15k, for example, and they want a 25% commission, that leaves $11,500 on the table for you. That's a 76% premium over the above plan if they can actually get it. That's a pretty good payoff unless we're talking YEARS to do a deal. I think my bank pays 2% on accounts right now for example. How long will it take? They don't know, which is part of why they're interested in a consignment deal rather than buying it outright, but the shop you're working with should be able to make a decent guess. That's part of what you're paying them for. Ask. Again, be wary of high asking prices. That just kills the sale. They can ASK $25k, and they can do it for 15%, but it does you no good if they can't actulally sell it for that.

Edited by denverappraiser
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Actually, probably Sotheby's or Christie's will take it, but it won't sell well, for all the reasons that Neil has explained. The reason why they'll take it is precisely the same reason why eBay will take it: it's income for them even if it doesn't sell, and they aren't evaluated on what they don't sell or sell poorly.

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