Appraisals and Selling Your Jewelry

Here are three inquiries I’ve received this month through my website:

“I am interested in getting some of my jewelry appraised so that I can sell it.”

“I own a diamond ring and wish to sell it; first, an appraisal is needed.”

“I have a platinum and diamond wedding ring that I wish to have appraised for the purpose of selling it.”

Well, do you really need an appraisal? A central problem is: there is no one single value. No matter what you own, there is almost always more than one way to sell it: through private sale, garage/estate sale, consignment online or to a local guy like me, or outright sale to someone in the business (who might be anything from a retail jewelry store to a pawnshop. Even, sometimes, auction, live or online. Depending on which of these markets you enter and the time you allow them to work, the difference can certainly be double, maybe more.

Within any one of these secondary markets, a range of possible prices exists. Except for auction, sales of most jewelry are too hard to document to yield an easy answer to the question “what’s it worth?” A good appraiser will make intelligent adjustments for size and quality to the available information about comparable items he or she can find and give the likely selling price of your item in as wide or narrow range as the data about the item dictate.

Think for a moment about how people actually price privately pre-owned (or just call it used) jewelry for sale, especially to another private individual. Needless to say, it is not a pure science. One factor is the occasional nature of selling most jewelry: one engagement ring per lifetime, or two or three at most. This influences how open to negotiating with your prospective buyer, one of two birds freshly flown in from the bush and about to alight near your hand, you will decide to be. In turn, we enter the subjective realm of sales psychology, which asks: when you quote a price, and you look at the jewelry itself sitting in front of you, what sounds about right for what you see?

Remember that you’re not a store, or in a store, and your buyer knows that the item isn’t new. That’s his or her market comparison, so you’ve got to create a sense of better value than retail. At the same time, both of you understand that you’re getting more from an end user than you would from a dealer. So when you think together collaboratively, what is the range in between? As seller, you also think about whether there is any money in the designer’s name, and if you can keep the dollars below a psychological threshold. (The old thing about $999.99.)

In the resale situation, some people want an appraisal document for Retail Replacement Value. This term is drawn from the world of insurance. I have found that it is highly subject to doubt and confusion, at best, and, sometimes, contempt. These feelings often emerge if the appraisal is used as an opening gambit in a negotiation to set the proper re-sale market price for your jewelry item.

There was a jewelry consignment shop here in Oklahoma City that did things this way, working with an appraiser who provided an insurance document. The shop simply cut the number in half to arrive at the price. Why not just appraise item's “value” (or, more accuarately, cost) in that shop at the amount for which it actually sold?

I believe that utilizing Retail Replacement Value for re-sale appraisals is taking the long way home. There is debate within the appraisal profession over whether it is advisable or even permissible in this situation. Professional jewelry appraisal standards definitely require us to learn how an appraisal document will be used; and to present content that is consistent with that use. I think the most descriptive language is Marketable Cash Value, along with a definition of the motivations of the buyers and sellers (in other words, the type of market) and an estimate of the time required. We may reasonably report a range of values for a particular market.

Sound too complicated? The way out is consultation. You don’t need an appraisal; you need Broker’s Price Opinions, which give you an idea of the most likely selling price for your jewelry in different scenarios. Together we strategize the best way for you to sell it. Virtually always, it's all you need to decide what's best for you to do, and it’s helped hundreds of people over the years. Please contact me if you have questions or want to make an appointment.