Why does diamond lose so much value after purchase?

Ruthie Predovic asked a question: Why does diamond lose so much value after purchase?
Asked By: Ruthie Predovic
Date created: Sat, May 1, 2021 1:36 PM

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Those who are looking for an answer to the question «Why does diamond lose so much value after purchase?» often ask the following questions:

👉 Does jewelry lose value after purchase?

The answer is complicated, because it depends on how and where you buy the diamond. Private jeweler and diamond expert Dan Moran spoke with financial advisors at GoBankingRate.com about luxury items that don't lose their value the moment you purchase them… Lab grown diamonds, or synthetic diamonds, are not.

👉 Do diamonds lose value after purchase?

“Diamonds have and retain a market value that is either consistent or increases over time,” said jeweler and diamond expert Dan Moran of Concierge Diamonds Inc… With lab-grown diamonds, there is an ever-growing supply but not an overwhelming demand. So naturally, the lab-grown diamond loses its resale value.”

👉 How much value does a diamond ring lose?

We’ve covered these reasons in more detail below. In most cases, a diamond engagement ring or other diamond jewelry will have a resale value of between 20 and 60% of the amount it cost when it was new. How Much Can I Sell My Diamond Ring For?

8 other answers

It doesn’t, it just depends how much research you did on your diamond, and where you bought it. As there are stores that charge 20% profit, and there are stores that charge 200% profit. Obviously if you over paid for your Diamond, you will lose a lot of value after purchase. As I have seen stores sell a $5,000 diamond for $15,000.

Buying online obviously makes selling a diamond much easier. Your cost basis is lower (so it will be easier to recoup your money if you need to sell on the open market) and the retailers give you options for returning and upgrading (so you retain full value for the ring). Upgrading your diamond through a typical retailer usually does not give you the value you would expect.

As a result of the retail mark-up and the decline in diamond prices, the resale value is typically well below what you paid. Indeed, diamond jewellery will typically resell for 25% to 50% of the purchase price. And even less as a percentage of appraisal value. How can I get a price for my diamond?

You lose big when you buy it originally because of the profit in the sale for the retailer. After that, it pretty much just holds its value. So- I just “depreciated” the value of my wife’s diamond about 40% from the retail price, and that should be its long-term value. With inflation how it is, a diamond just keeps up with it.

Synthetic diamonds also cost between 15 and 30 percent less than real ones. Though, knowing how much natural diamond prices are inflated, 15 percent off doesn't sound like much. The process is a doozy — arguably more involved than mining — so the high price makes sense.

When you "lose your illusion" in a diamond, it means you have succumbed to the reality that you will be selling it for less than you had hoped for. When you "have illusion" in a diamond, it means that you still believe you're going to sell it for a great price because it's such a knockout stone.

BERGSTEIN: Diamonds are so costly in part because people are willing to pay the high price for them. You know, De Beers and other diamond sellers have been telling us that diamonds are not only...

This damage lowers the value of the diamond. While a chipped diamond can be re-cut, the lower carat weight will still decrease the overall value. The long and short of investment diamonds is that diamonds are subject to the fluctuations of supply and demand, so the more rare a diamond is, the more likely it will appreciate in value over time.

Your Answer

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Does diamond jewelry hold its value?

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Do diamonds lose value?

“A diamond retains its value because there is a finite supply,” he said. “The basic laws of supply and demand maintain that as demand increases, value goes up. With lab-grown diamonds, there is an ever-growing supply but not an overwhelming demand. So naturally, the lab-grown diamond loses its resale value.”

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