Secondary market prices fell by 13% last year, across all makes and models, a greater drop than for the whole of 2022, although that was the year when prices were at their peak in Q1 and declined from April onwards.
Over three years, after market prices have been on a rollercoaster ride, but remain 10% higher than the start of 2021, according to a Morgan Stanley report using WatchCharts data.
For the big three, Rolex prices fell by -8% in FY23, Audemars Piguet was down 18% and Patek Philippe watches lost 15% of their value.
It is worth noting that anybody buying watches brand new from authorised dealers is still able to flip them for a profit if they can find another consumer (trade buyers will offer considerably less).
Morgan Stanley’s report says that 68% of Rolex models, 48% of Patek Philippe models and 66% of Audemars Piguet models are still selling for over retail prices.
The flipper-to-flipper market that exploded in 2021 and early 2022 has all-but vanished. Any of them who bought at the peak have seen their investment fall for seven consecutive quarters.
An important metric, highlighted for the first time in the latest Morgan Stanley report, is value retention, which compares the retail prices of the biggest brands with their secondary market prices.
It pays to drill into this data, reference-by-reference, but for investors looking for the relative strength of manufacturers, it is a useful guide.
Patek Philippe leads the field, with its watches selling, on average, for 39.4% above retail prices.
The premium for Rolex is down to 20% and Audemars Piguet, which once saw its steel Royal Oaks selling at up to 4x retail, is now attracting just a 14.4% uplift on average.
Every maison owned by publicly traded Swatch Group and Richemont has its watches being sold on the secondary market for below their retail prices.
It is worth noting that 13% of Vacheron Constantin references still trade for over retail, down from 19% in July 2023, but the average for 15 Overseas references is a loss of over 7% from retail to the secondary market.
Among the big three, the highest premiums on the secondary market are being paid for the average Patek Philippe Aquanaut, which is selling for 80% above its retail price.
Rolex’s GMT-Master, can be flipped for 48.2% over retail and Audemars Piguet’s Royal Oak (an average of all references in the family) are still 46.4% over retail.
