Appraisal Differences depending On Region or State?

[perry]

I guess that today is my day for questions? Here is my second one of the day.

There are many wonderful appraisers who routinely respond to questions on this site, and ultimately I believe in supporting those who support me in my quest as long as there are no major price or service differences.

However, I have been told by several jewelers that each region of the country, and even some regions within certain state, have different diamond markets (what''s hot in that region) and that the same ring will appraise differently depending on where you are living.

Is this true, and how do the appraisers who are in different regions of the country account for this when they get sent stones or a ring from an e-vendor that will end up in another area of the country (or even out of the US)?

Thanks in adavance for your responses.

Perry

 

[denverappraiser]

Perry,

Great Question! For an appraisal to be useful, it is necessary to define what market is being described and this will vary depending on the client’s requirements. Geography can be quite important, especially with unusual kinds of items. I once did a review appraisal on a platinum/diamond bracelet that was over $300k on behalf of a client who lived in a small town in Wyoming. The owner of the only jewelry store for over a hundred miles did the original appraisal. In the appraisal, she described her findings as ‘the average retail price of a similar item in the in the local marketplace.’ The problem is that there is no local marketplace. A jewelry store in Frozen Dog Wyoming is simply not the way that such things change hands! The entire appraisal was thrown out (this was a court issue).

Diamonds are easier because something of a national market has developed and this has all homogenized a bit. Dealers in Wyoming buy from the same sources as dealers in NYC and the shipping component to bring it out to gods country is not terribly high. The biggest difference is the appropriate markup used by the dealer.

For new sale – insurance type appraisals, I normally try to use the local market of the consumer if there is one, because that’s where the replacement will occur.

Neil Beaty, GG ISA
Independent Appraisals in Denver