You may think it gauche to be talking about the economy when most people are more worried about health than shares. But the issues are intertwined: the pandemic’s caused the global economy to contract, which in turn means people’s livelihoods are suffering.
We’re lucky that in Australia (well, at least not in Melbourne) we’re bouncing back and things are returning somewhat to normal, even if we’re heading into a recession.
Perhaps unsurprisingly, trends in the watch market have seen a similar dip and subsequent bounce. What is surprising, though, is that after observing a noticeable decline in sales during the first few months of the pandemic, as WatchPro reports, international watch marketplace Chrono24 has revealed data that suggests we are now seeing a strong bounce back in demand for luxury watches on the secondary market.
Chrono24 has kept a close eye on activity across its key markets (e.g. USA, UK, Germany, Italy, etc.) and their data shows how they’ve all experienced similar market trajectories: a dip during the start of the crisis, then a huge rise in demand, leading to higher than pre-COVID sales figures presently.
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Perhaps it’s a reflection of the national mood in these different markets. For example, Italy was hit badly by COVID-19, but in recent months has recovered drastically and is now on a downward trend in cases. Perhaps now that things are less dire in Italy, people feel comfortable spending money on nice timepieces again.
This doesn’t explain the rise in sales in the US, however, which has become the pandemic’s new epicentre and continues to observe an upwards trend in cases, as well as a huge amount of civil unrest. Instead, maybe Americans have just adjusted to this ‘new normal’ and want to do some watch shopping to distract themselves from their country falling to pieces around them.
The global recession hasn’t affected watch prices dramatically – there’s no chance of picking up your grail for bargain basement prices, we’re afraid. There’s definite winners and losers: Chrono24’s stats focus in on how Rolex’s GMT-Master II “Pepsi” has seen prices fall by 7% while Patek Philippe’s Nautilus 5711/1A has risen by 9% as explicit examples.
Prices have softened somewhat for some super rare models but Chrono24’s evidence largely suggests that prices are under downward pressure as customers are negotiating harder, requesting up to 16% higher discounts than pre-coronavirus levels – that said, more price negotiations are falling through too, so just because people are asking for discounts doesn’t mean they’re getting any.
If you’re currently in the market for a vintage watch, DMARGE founder & publisher Luc Wiesman has some sage advice for finding gems and making sure you don’t get ripped off in the process. In short: look for watches with reliable movements, a history of price stability, and make sure you read up on your watches.
“The devil is in the details where investing in vintage watches is concerned. Small changes made between different versions of the same watch can mean the difference between a $5,000 investment and a $50,000 investment. Do your research ahead of time and know exactly what you’re looking for.”
Read Luc’s sage advice here before you jump online looking for a watch bargain. You can also check out Chrono24’s market reports here.