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Watches as an Investment

Robert-Jan Broer
12.12.2014
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Patek Philippe Nautilus 5700 Patek Philippe Nautilus 5700, Image: FratelloWatches
Robert-Jan Broer
12.12.2014

Watches are bought for various reasons. The best reason would be that you just want to own a nice watch, and one that will last a lifetime. Perhaps even to give it to the next generation when the time has come. The worst reason – in my opinion – would be buying a watch solely for the recognition from others that it is an expensive piece.

Then, there is a group of people who buy watches as an investment. Not an investment as in buying stocks or bricks, but a watch that will most likely increase in value over time or at least keep its value after buying it. I could be really short and simple in this article about watches as an investment and point my finger to almost any stainless steel sports Rolex out there. However, it would be interesting to see whether there are any patterns behind watches that have proven to be a solid investment.

With Rolex, it isn’t that easy anymore, as it seems now in retrospect. The original Rolex Explorer II and the four-digit reference numbered Rolex Cosmograph Daytona, for example, were hard to sell when they were put into the market. Even the original Milgauss wasn’t a strong seller. If you want to buy one of these watches now, you really have to bring some cash with you. However, will it be the same with the current modern Milgauss and Explorer II timepieces as well? The demand for the Daytona has always been high, and you can’t do much wrong with it, but will the value of a modern Rolex Daytona increase as steeply as the models (< 1988) from the past?

So, in order to prevent misunderstandings, let’s divide the watches that have a good chance in gaining value over time into a few categories.

New Watches:

This is perhaps the most difficult category to predict any winners. However, like I wrote above, a stainless steel sport Rolex like a Submariner or Daytona are likely to gain in value as the annual increases are quite steep on the catalog prices (and the value on pre-owned watches increases just as much). So after taking a bit of loss on the list price at first, after a couple of years you will at least be able to get your initial investment back.

Other brands do not have the same status as Rolex, to be honest, so you should go brand-by-brand and model-by-model to discover the ones that will keep their value and hopefully increase. Take a good look at the catalog prices of the past few years to see which ones increased and whether the prices of pre-owned watches also increased. Also take a look at the next category.

Iconic Watches:

Whether they are new watches or pre-owned watches, watches that fall into the category of being an icon (or cult watch) are most likely to retain value and perhaps even to increase in value over time. A great non-Rolex example is the Patek Philippe Nautilus – either the original 3700/1A or a modern 5711/1A – as this watch is unlikely to be found in stock at a dealer, but rather always on order.

A stainless steel Audemars Piguet Royal Oak (15202 or one of its predecessors) might also be a good pick but only as a pre-owned watch, for the list prices are relatively high and there is a bit of space between market value and the price in the catalog. However, when bought for the right price, this is a keeper as well. The Patek Philippe Calatrava is another example of a watch that is slowly creeping up in value when bought new for a good price.

Limited Editions:

A lot of brands create limited editions. There are actually a lot of brands that seem to have more limited edition models in their collection then regular production models. Be keen about this. Also try to track some of the limited edition models from the past and compare (then) list price to the current market value. Interesting and affordable some limited editions are the Omega Speedmaster Professional Apollo XI editions that are brought out every 5 years.

Omega Speedmaster Snoopy

Omega Speedmaster “Snoopy”, Image: © Bert Buijsrogge

Try to get a Apollo XI from 2009 under the list price at the time of introduction or actually try to find this year’s Apollo XI at a discount. A great example of a limited edition Speedmaster Professional is the Snoopy Award model. In the early years (2003 and so on) they were piled up at retailers, and suddenly, they were gone. Even though the production number was relatively high (5441 copies), the watch is difficult to come by and at a much higher price than it once was new.

Low Production Watches:

I don’t aim at the limited production series of 300 Hublot watches or 30 IWC watches, but at watches that are really low in production number and mainly from independent watchmakers. Watches that are perhaps not even made in series. Once the production of these watches stops, there will be no more of them. When that happens, it is the collector who really wants to have such a discontinued watch. How much he will pay for it? Since there are so few of them, even personalized, the price can go up in a crazy way. As long as there is no real supply of these watches, the prices are subject to how badly someone else wants to have that watch.

An interesting way is to search for some of these watches on Chrono24, see if there is a single result. If there are none, or just one or two with a ‘Price on request’ label, then you might be on to something. However, this also might not be the safest way to buy a watch as an investment since the target audience is also really small.

F. P. Journe Octa

F. P. Journe Octa, Image: Auctionata

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