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Metropolis Desk-
One of the hottest collector’s items these days is a preowned luxury watch. Expensive secondhand watches from brands such as Rolex and Patek Philippe have become increasingly popular in recent years, particularly with younger buyers, according to a report published this month by Boston Consulting Group. Preowned luxury watches became more valuable as demand grew but supply remained tight, BCG said.
Those watches have become so coveted that the market for them has outpaced the overall stock market, growing about 20% annually from mid-2018 through this January, compared with the S&P 500 index’s yearly growth rate of 8% during that period, BCG said.
More collectors have seen watches as not just accessories but also as investment pieces that can hedge against inflation and diversify their holdings. In the past few years, other popular alternative investments have included the art market, baseball cards and now-struggling cryptocurrencies, reports The Wall Street Journal.
Collectors often pay double or triple the price for a secondhand watch, even one that may have just left the store, said Nicolas Llinas, a principal consultant in BCG’s consumer-practice division who helped author the firm’s report. For example, Rolex Cosmograph Daytona watches with a retail price of $14,800 recently sold on secondhand platforms for as much as $38,500, according to BCG. One such platform, WatchBox, helped fund BCG’s latest watch research.
New luxury watches have been harder to come by than usual because earlier in the pandemic, manufacturers closed their factories or slowed production. Collectors are more likely to find the watches they are looking for on secondhand platforms, which have become more sophisticated in recent years, according to BCG.
Some people are drawn to luxury watches as expressions of their personal style. Others see the watches as heirlooms that can outlast other collector’s items. BCG found a basket of preowned watches has outperformed indexes that track handbags, wine and art over the past decade.
Researchers at BCG say there are two reasons people are spending thousands on a used watch: secondhand platforms have emerged as increasingly viable places to buy the items and social-media communities have helped generate buzz for watches as investment pieces.
Bryan Ang, 31 years old, is part of a growing community on Instagram of preowned luxury watch fans. He often posts about the pieces in his collection, including his favorite watch, the Rolex Datejust with a special white dial.
“I look at secondhand watches as a rental,” said Mr. Ang, a fruit distributor in Manila. “You wear it for a while, you enjoy it and realize, ‘I don’t think it’s me.’”
Mr. Llinas from BCG said millennials are more likely to buy preowned luxury watches, whereas older buyers tend to prefer buying timepieces new. He said millennials tend to have a more business-minded approach when they build their collections.
“They don’t get as personally attached to some of those watches,” said Mr. Llinas. “Sometimes they’ll resell a watch to get one that’s more coveted.”
In 2021, preowned watches accounted for nearly a third of the $75 billion luxury watch market worldwide, according to BCG. Preowned-watch sales rose 3% in 2020 after the pandemic started even thoug sales of new watches fell 17% that year.
Representatives for luxury watchmakers including Rolex and Patek Philippe didn’t return requests for comment. Audemars Piguet Holding SA declined to comment.
Collectors have more often turned to secondhand watch-buying platforms like Chrono24 and Watchfinder & Co. than they have gone to a watch store or bid in an auction, according to BCG. Sellers list their watches on the secondhand sites where potential buyers search for the rarest models and the coolest designs.
The most popular secondhand watches include the Patek Philippe Nautilus, the Audemars Piguet Royal Oak and the Rolex Daytona, according to BCG. Some of those models are listed for tens or hundreds of thousands of dollars on secondhand platforms.
Some of the most colorful models on the secondhand platforms this week included a rose gold Audemars Piguet watch with rainbow sapphires, listed for $315,000. For $3,700, a collector can take home a Richard Mille watch decorated with a smiley face and a pineapple.
Mr. Llinas said that collectors are trying their luck on the secondhand market rather than waiting potentially for years for watchmakers to sell their favorite models.
“If you really want a watch and you’re super passionate about it,” he said, “the only way to get the watch is through the secondary market.”
Appeared in the March 13, 2023, print edition as ‘Secondhand Watches Are Beating the Stock Market’
