The market for pre-owned watches is going sideways.
After prices for the most traded watches plunged after spiking in February 2022, they now appear to have found a floor.
Advertised prices suggest there is still good money to be made flipping hot watches like the Audemars Piguet Royal Oak or Rolex GMT Master II.
But the reality is that, with the exception of Patek Philippe’s Nautilus and Aquanaut, and Rolex’s steel Daytona, punters trying to sell these watches, particularly to big operators like Watchfinder or WatchBox, will not be offered prices over their retail value.
This is a welcome return to normality.
Before the price bubble of 2021-22, the overwhelming majority of luxury timepieces were selling online at a discount to their retail prices.
There was less trust in the market for second hand watches than there is today, and far less engagement from the manufacturers, but this made it a good place to go and pick up a bargain.
For those willing to take the plunge, it was a cheaper entry point into the luxury watch world.
The past 18 months have been extremely difficult for any trader holding significant stocks of the hot watches.
Trading — much of it business to business with watches circulating at ever-rising prices between dealers — all-but seized as everybody anticipated even lower prices if they waited a week or a month to buy.
The stable prices since the start of the year, have taken away this fear, and a new normality is settling-in.
Secondary market specialists are getting their mojo back.
eBay has been reporting record sales of luxury watches.
WatchBox has been opening collectors’ lounges all over the world, the most recent being in Shanghai.
Chronext just did a deal with Breitling to become an authorised service centre in Germany.
Bob’s Watches just signed a rising American golfing star as a brand ambassador.
Watchfinder recently launched its own marketplace where select dealers can consign watches for sale.
And, today, we hear that the world’s best paid athlete, Christiano Ronaldo, has invested in Chrono24, a company that last year was cutting staff to reign in costs.
What we will see is that the major players that have experience from before the bubble will emerge leaner and battle-hardened from the past 18 months.
The landscape will continue to evolve, most notably with the biggest brands like Rolex launching certified pre-owned programmes, but these pre-owned specialists have proved adaptable and nimble.
They are very likely to stay one step ahead of the Swiss manufacturers, who deal in glacial pace of change, not week-to-week pivots.
There has been very little news of fresh investment in the secondary market since 2021, and we do not know how big a cheque Mr Ronaldo has written for Chrono24, but I expect we will see more money coming into the space in the coming months now that confidence is returning.
There is also likely to be consolidation, because scale seems to matter (being very big or very small seem to work, but in-between is tough).
I, for one, want to see the primary and secondary market work more harmoniously together, and I think this will happen as well, because if, as analysts predict, the pre-owned market catches up to become as big as the new watch market in the next 20 years, it will mean a far bigger pie for all.
