As retail opens up around the world, it appears that demand is focused more narrowly than ever on the hottest watches from Rolex, Patek Philippe and Audemars Piguet, which continue to sell at well above recommended retail prices on the secondary market.
David Hurley, executive vice president for The Watches of Switzerland Group in the United States, says there has been a flight to the sort of investment-grade timepieces so prized by flippers.
“During Covid, it seems people have doubled down on purchases that hold and grow in value,” he describes in an interview with Professional Watches. “Rolex continues to be a top performer along with AP, and Patek.”
Sales remain robust for these key three brands despite a limited number of new watches being launched. Patek Philippe has launched just four watches this year, Audemars Piguet has focused on is CODE 11.59 rather than the far more popular Royal Oak in the first half of the year, and Rolex will not reveal any new watches until the first week of September.
Mr Hurley says the announcement of new watches has been crucial throughout lock down and since.
“I would say that the pace of new watch introductions this year — which seems to show no signs of slowing down — is also driving a lot of consumer interest,” he suggests.
What happens to the value of the most popular steel models when the markets shifts down? In other words if I pay double for a steel watch on the secondary market today, am I guaranteed the same price when I resell it when the market bursts? Are these watches truly price inelastic? Even though the prices are above the AD’s list price, there seems to be a lot of supply – just not in the AD’s display cases.
No price is inelastic. You aren’t guaranteed anything. If you sold tomorrow, you’d be (somewhat) guaranteed that money back. There’s no telling how the market will be in years to come. Could be better, could be worse. I had the same concerns when I bought my 16710 GMT Master II. Obviously I didn’t spend 2x retail, but I was concerned about the market dropping out and it being worth considerably less than I paid. A good friend informed me that you have to be okay with spending that much and potentially losing that much. Plus, if its a watch you plan on keeping forever, resell value doesn’t really matter in the grand scheme of things.