Luxury watches are not just fancy accessories; they’re a combination of fashion, status symbols, and mechanical art that has captivated people for years. But did you know that the preowned luxury watch market is now gaining more attention than ever? It’s true! Growing buyer interest and a shortage of the best models have made the preowned luxury watch market a hot topic. But here’s the twist: it’s not just about style, it’s also about money!
Investment Potential for a Preowned Luxury Watch
Luxury watches have become a popular alternative investment. Buyers are willing to pay premium prices for preowned models from top brands like Rolex, Patek Philippe, and Audemars Piguet, as well as from leading independent brands like F.P.Journe and De Bethune. Why? Because they believe these watches will continue to increase in value over time.
And they’re not wrong! Luxury watches have historically performed well compared to traditional investment categories. From August 2018 to January 2023, the average prices of top models from Rolex, Patek Philippe, and Audemars Piguet in the secondhand market rose by 20% annually, despite market downturns during the pandemic. In comparison, the S&P 500 index only grew by 8% per year. Even during the 2007-2009 recession, luxury watches outperformed stocks and bounced back quickly from the market crash.
The positive financial performance of the preowned luxury watch market has attracted a wave of new buyers, fueling growth. In 2021, preowned watch sales reached a staggering $22 billion, accounting for nearly one-third of the overall $75 billion luxury watch market. The secondhand market is growing faster than the firsthand market, and this trend is expected to continue.
So, who are the people jumping into the world of the preowned luxury watch? Well, they come in all shapes and sizes! According to our survey, the typical luxury watch buyer is a high-income millennial or Generation X male. We can classify them into four general buyer types:
1. Classic Timeless: These buyers appreciate traditional financial assets and seek classic or timeless watches with a strong brand heritage or distinctive design. They are low-frequency buyers and tend to avoid the secondary market.
2. Fashionable Professional: Highly educated and stylish, these buyers are younger than others. They prefer entry-level luxury watches that are trendy and of high quality. Sustainability is often a key factor in their decision to purchase preowned watches.
3. Luxury Watch Hobbyist: Technically complex watches with a strong brand heritage are a hobbyist’s delight. They enjoy the thrill of hunting for special watches and are moderately frequent buyers.
4. Collector/Investor: The most active buyer group, collectors/investors favor ultra-luxury watches. They represent a significant share of the market by value and are highly engaged with the secondary market.
Why the Boom?
One major reason for the growth of the preowned luxury watch market is the increasing number of consumers looking for investment opportunities. Gen Z and young millennial buyers have increased their spending on luxury watches due to the ease of buying and selling, as well as the potential for retained value or value growth. Many expect to spend even more in the next 24 months, indicating the category’s positive momentum.
The luxury watch market is an exciting and dynamic world that combines style, status, and smart investments. With the growing interest in the preowned luxury watch and its investment potential, the market has experienced significant growth, outperforming traditional investment categories. Buyers are willing to pay a premium for top brands and independent watchmakers, confident in their value appreciation over time.
The secondhand market has become a major player, accounting for a significant portion of overall luxury watch sales. The market’s expansion is fueled by a diverse group of buyers, ranging from classic and timeless enthusiasts to fashion-forward professionals, passionate hobbyists, and dedicated collectors/investors. Each buyer segment contributes to the market’s vibrancy and further drives its growth.
The rise of the preowned luxury watch market can be attributed to factors such as increasing interest in alternative investments, the ease of buying and selling watches, and the potential for retained or increased value. Younger generations are actively engaging in luxury watch purchases, recognizing the market’s potential as a source of financial growth.
As the world of luxury watches continues to evolve, one thing remains certain: the combination of style, status, and smart investments will always make it a fascinating and alluring industry. Whether you’re an avid collector, a fashion-conscious individual, or an investor seeking diversification, the preowned luxury watch market offers a gateway to a world of timeless beauty and financial potential. So, step into this exciting world and embark on your own horological journey!
Jonathan’s Fine Jewelers buys and sells all luxury brands of watches. Rolex, Cartier, Piaget, Audemars Piguet, and more. Contact us to see what we have in stock, or what we can source for you. If you have a luxury watch that you would like to upgrade or sell, let us know! We are always looking for amazing watches to add to our inventory!