If there ever comes a time to to sell an engagement ring, the first thing that ring owners go for is the appraisal. It completely makes sense for trying to get an idea of the offer you’ll receive, you want to get an idea of the value that you have in the ring prior to attracting buyers. Most sellers ask us if we need to see the appraisal before we make an offer on the diamond. I’ll say yes, but it’s not for the reason that you may think.
When we are giving a quote to someone selling an engagement ring or selling a diamond, we don’t really look at the appraised value, but we do look at how the piece was described. Our offer is always based on the current pricing of diamonds. The diamond market today has certainly gone up from certain times and gone down from other times. If you wanted to see how much your diamond has changed (or stayed the same) in value, independent of our offer on your piece, it’s wise to get an idea of the current “retail” value. This can be done by looking for a diamond like yours for sale online to the public.
Back to the appraisal. Appraisals are necessary and often required for a Will or for insurance purposes. When it comes to selling a diamond or selling an engagement ring, there is a replacement value (appraisal) and a resale value. There is an important distinction between those two terms and we explain them below.
Replacement Value
In jewelry, a replacement value is the estimated amount of money that it would take to have an item replaced. This value can be based on any custom design/fabrication in the piece or simply the difficulty in acquiring a stone exactly like the one that you had. Not every diamond is priced the same, a replacement value takes into consideration that a premium may be necessary to re-acquire an equivalent in quality of the goods that you owned. The premium is set to try to take into consideration market shifts in the diamond prices that can fluxuate over time. For example, if more diamonds enter the wholesale market comparable to the one you have, it could drive down the collective value of the group of similar diamonds. Then again, if no stones like yours are available on the market and someone desired that stone, it could cause the value to increase. Either way, the replacement value should be set at an amount that could replace the item with some allowance for market fluctuation. With all of that being said, if the appraisal is drastically higher than the price you paid, it’s wise to get a second opinion on the appraisal from a different jeweler. Unethical jewelers online and in-store have sent appraisals that make the paid price seem like a “deal” when in fact, the replacement value was simply inflated to make the consumer feel better about his/her purchase.
Resale Value
This is the real number that you need to know for selling a piece of jewelry. Resale values will not be on an apprasial. The resale value is what someone will pay for the goods in their current state. This value is generally a “used” price and it’s based on what someone wants to pay for item. The price of the resale item is generally based off the current retail value, and generally discounted to help sell the item. Consumers often confuse replacement value and resale value, or they believe them to be the same.
The biggest hurdle for a person trying to sell a engagement ring is coming to the realization of a resale value that they can live with. In the perfect situation, there’s normally a balance, slightly less money than the seller really wanted and slightly more than the buyer wanted to spend. We at Speedy Diamond try to make our best offer, our first offer.
