Unless it is property or collectible art everything in the world depreciates. Well, some products depreciate quickly while some slowly, but they all lose their value over time. A luxury watch is no different, if we keep aside a few watches, the price of all the luxury watches goes down.
So if you are thinking of buying a premium watch for investment purposes then you should reconsider your thoughts. But does that mean all watches depreciate? And if yes then how much do watches depreciate? Let’s find out!
Quick links to specific parts of the article:
- How Much Do Watches Depreciate?
- Factors That Affects The Rate Of Depreciation
- How To Tackle The Depreciation
- Do Watches Hold Their Value? Final Verdict
How Much Do Watches Depreciate?
If you want to find out how much does a watch depreciate then there is no hard and fast rule which can determine how much a watch’s price drops over time. However, when a study was done on 25 watch brands, it is found that a luxury watch generally depreciates at the rate of 3.6%/year.
It is seen that a luxury watch depreciates most in its first year. Some brands like Tag Heuer may even depreciate up to 50% for the first year. However, after losing a lot of its value in the first year itself a luxury watch’s depreciation rate decreases over time.
Let’s have a look at the average depreciation price of some high-end luxury watches.
1. How Much Do Rolex Watches Depreciate?
A Rolex watch may lose up to 11% of its value in the first year. However, most of the Rolex watches start appreciating at the rate of 6.3% every year after that instead of depreciating. So if you really want to invest in a luxury watch then Rolex can be the safe option for you.
2. How Much Do Breitling Watches Depreciate?
Breitling is also a luxury watch brand from Switzerland. However, it loses a large chunk of its value in the first year itself which is 35.5%. On average, Breitling watches lose 16% of their value each year to depreciation.
3. How Much Do Patek Philippe Watches Depreciate?
A Patek Philippe watch is 26% less valuable after the completion of its first year. On average it loses up to 10% per year. However, due to its high demand, a Patek Philippe watch may go over 1oo% profit in the grey market.
4. How Much Do Tudor Watches Depreciate?
After Rolex, if there is a brand that holds its value very well then it has to be Tudor. Tudor watches only lose 6 to 7% of their value in the first year. And if we calculate the average annual depreciation then it is only 0.7%.
5. How Much Do Longines Watches Depreciate?
In the first year itself, you will lose 35% of your Longines watch’s value and on average it depreciates at 7% per year.
6. How Much Do Apple Watches Depreciate?
An Apple watch has a limited lifespan when compared with other luxury watches. And therefore the depreciation is high, you will lose upward of 40% of your Apple watch’s value in the first year itself.
7. How Much Do Zenith Watches Depreciate?
You can expect your Zenith watch to lose 24% value of its original price in the first year. However, overall depreciation is only 5% per year which is not bad at all.
8. How Much Do Omega Watches Depreciate?
If there is a luxury watch brand that is as popular as Rolex then it has to be Omega. Due to their popularity, Omega watches only lose 6% of their value every year. However, in the first year, you can expect to lose 23% of the value of your Omega watch.
Factors That Affects The Rate Of Depreciation
1. Watch Brand & Model
How much does a watch depreciate depends a lot on the brand and model of the watch. If it comes from a brand like Rolex and Patek Philippe then the depreciation will be less. On the other hand, some other brand watches like Hublot, and Tag Heuer lose their value at a higher rate.
However, it does not mean that all Rolex and Patek Philippe watches hold their value, it also depends on the model of the watch. Some models of these watches are sold for even millions of dollars while others at much lower than their original price. The depreciation also depends on whether the watch was a limited edition or a regular watch. If it was a limited edition watch then it will hold its value and moreover grow in value over time.
2. Demand Of The Watch
Men’s watches depreciate at a lesser rate than women’s watches due to the fact that there is a higher demand for men’s watches in the market. But slowly the women’s watch market is also coping up and the day is not too far when the demand for women’s watches will be the same as men’s watches.
3. Fashion Trend
The trend also plays a major role in determining the price of a watch. For example, in the earlier days, oversized watches were in trend but now people like to wear smaller dial watches that fit well. Hence, the price you can get for your old oversized watch may be on the lower end than you expect.
Similarly, if a watch becomes a part of pop culture its value increases abruptly. Watches associated with famous personalities are sold at a much higher price. For example, a Rolex Daytona was sold for $17.75 million at an auction because it was preowned by Paul Newman.
4. Metals Used In The Watch
If a watch is made of precious metals like platinum or gold rather than stainless steel then it will definitely depreciate at a faster rate. Moreover, since stainless steel watches are cheaper there is always a huge demand for them and hence their value does not go down that quickly.
5. Watch Maintenance
If a luxury watch is well maintained with its box and documentation intact, you will surely get a better resell price for it than a watch that is not in good condition. I mean who would want to pay high prices for a watch that has scratches all over its body?
How To Tackle The Depreciation
1. Buy A Second-Hand Watch
If you fear a lot about depreciation then you should rather buy a second-hand watch. You can get a pre-owned watch at a very good price. Moreover, since luxury watches depreciate most in the first year, the first owner has taken that hit and you being a second owner of the watch can sell it at almost the same price you bought it.
2. Go For A Branded Watch
As you may have seen above, some premium brands like Rolex, Omega, Tudor, and Patek Philippe have good resell values. Therefore when looking for a new luxury watch you should always go for a brand that has a good reputation in the market and has a good customer base.
Do Watches Hold Their Value? Final Verdict
If you have read the entire article then you must have learned by now that almost every watch depreciates over time except a few watches from brands like Rolex, Patek Philippe, Audemars Piguet, etc. However, if we look at the big picture, watches lose their value over time just like cars and hence are not considered the best investment.
If you are looking to buy a luxury watch, going for a second-hand timepiece is a good idea considering that you are getting it for less price and you can sell it at a similar price at which you have bought it. Because a pre-owned watch does not depreciate as much as a brand new one.
Is Buying A Rolex A Good Investment?
Rolex watches hold good value as compared to other brand watches but still, they are not the best investment because you cannot guess what's going to be the value of the watch 10 years down the line.
Do All Watches Go Up In Value?
No, not all watches go up in value. Most of them except a few models from a few brands depreciate over time.
Do Women's Rolex Hold Value?
Since women's Rolex watches have less demand than men's Rolex watches,their value may not be at the level of men's watches.