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Buying a diamond from a friend ......

fmzip

Rough_Rock
Joined
Feb 22, 2011
Messages
83
So my friend is recently divorced. She has a 1.84CT solitaire ring that has never been appraised. It looks nice to me but what do I know.

She has a GIA report # 13768414 dated October 2004 so some info is missing like cut grade.

Without having an appraisal done, is there a way to ballpark the value of this ring like is it a 11k ring or 15K ring? This is a link to the GIA report. Is there enough info to make some sort of educated guess on price within reason. Like, I realize it's not a $5000 stone but what would it be closer to in value:

http://www2.gia.edu/reportcheck/index.cfm?fuseaction=home.showReportVerification&reportno=13768414&weight=1.84
 

slg47

Ideal_Rock
Joined
Apr 4, 2010
Messages
9,667
Are you interested in buying the diamond? I would look for one with a cut grade, personally. Also you can do much better than 'good' symmetry and polish for a RB. This diamond is also overly deep at 63.4%. From the information we have, I would pass on this diamond.
 

denverappraiser

Ideal_Rock
Trade
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Messages
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fmzip|1307722965|2942572 said:
<snip>Without having an appraisal done, <snip>
Well, you could roll dice and multiply the results by $2000.

Seriously, why would you want to go into a deal like this without professional assistance? At the very least you risk losing a friend over it and there is a HIGH possibility that you'll end up paying a price that at least one of you will regret later. This is exactly the sort of situation where an independent appraiser will benefit the both of you. If you don't like the results you can quitetly walk away by complaining about something on the appraisal (not necessarily the price) and if SHE doesn't like the results she gets mad at the appraiser, not you. If you do like the results and you can do the deal and both go away happy.

By the way, I would give the same advice even if it DID have a cut grade.

Edited to add. SHE should be getting an appraisal anyway, regardless of what you do. She needs to know where she sits before she hits the marketplace as a seller. It may not be you, but there's sharks out there. As you obviously know, there's WAY more to this deal than what appears on the lab docs.
 

Haven

Super_Ideal_Rock
Joined
Feb 15, 2007
Messages
13,166
I would pass on this stone. If you're in the market for a round, you can do much better.

ETA: The other thing to remember is that she cannot expect to get anything close to what she or her ex originally paid for this diamond. I hope someone with more knowledge here will chime in, but we generally tell people not to expect to get even half of what the diamond would sell for from a jeweler if they're selling it on the secondary market.
 

motownmama

Ideal_Rock
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7,477
PASS ............ I wouldn't buy from a friend. Go with a reputable co with an upgrade policy etc. A "recent;y" divorced friend is dealing with a lot emotionally and a highend transaction with a friend can come back to haunt you. Plus, are YOU going to wear around HER diamond from a failed marriage?

IF the "friend" is yourself definitely invest in an appraisal.
 

Amys Bling

Super_Ideal_Rock
Joined
Jun 25, 2010
Messages
11,025
From what I have seen, when it comes to buying/selling something or anything involving money, it can go south with a friend. Also do you want a divorce diamond? Especiallyone that was from a friends marriage? What if everytime they see it again in the future it sparks bad feelings and sadness???
 

fmzip

Rough_Rock
Joined
Feb 22, 2011
Messages
83
I was looking to understand the value of this diamond, not advice as to buy it or not
 

slg47

Ideal_Rock
Joined
Apr 4, 2010
Messages
9,667
fmzip|1307757613|2943017 said:
I was looking to understand the value of this diamond, not advice as to buy it or not
It is hard to determine the 'value' from the information given. I would recommend an independent appraisal.
 

Dancing Fire

Super_Ideal_Rock
Premium
Joined
Apr 3, 2004
Messages
32,068
fmzip|1307757613|2943017 said:
I was looking to understand the value of this diamond, not advice as to buy it or not
how much is she asking for the stone?
 

kenny

Super_Ideal_Rock
Premium
Joined
Apr 30, 2005
Messages
28,682
A 63.24% deep round is worth zero to me because I know it is poorly cut and too deep.

To me the value would depend on how much weight would be left after a recut.
I'd call someone with a reputation for recutting diamonds like Brian Gavin www.briangavindiamonds.com and ask him how to proceed.

That seller would make more money if she/he sold it to someone ignorant about good cut.
 

suchende

Brilliant_Rock
Joined
Apr 14, 2008
Messages
1,001
kenny|1307758586|2943029 said:
A 63.2% deep round is worth zero to me.

To me the value would be how much weight would be left after a recut.
I'd call someone with a reputation for recutting diamonds like Brian Gavin www.briangavin.com and ask him how to proceed.
yup this is what i was thinking. if it's a candidate for re-cut then offer a decent secondary market price minus the recut fee.
 

luckky

Shiny_Rock
Joined
Feb 20, 2011
Messages
193
fmzip|1307757613|2943017 said:
I was looking to understand the value of this diamond, not advice as to buy it or not
I see the subject "BUYING A DIAMOND FROM A FRIEND...." hope not you the one will buy it, as all friends here said I couldn't agree more.
 

denverappraiser

Ideal_Rock
Trade
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fmzip|1307757613|2943017 said:
I was looking to understand the value of this diamond, not advice as to buy it or not
If you can buy it for less than $7000 you're exposure is probably fairly low unless there's undisclosed damage. I wouldn't recommend paying more than $18,000 unless this is a deliberate effort to financially subsidise your friend.
 

Dancing Fire

Super_Ideal_Rock
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Messages
32,068
kenny|1307758586|2943029 said:
A 63.24% deep round is worth zero to me because I know it is poorly cut and too deep.

To me the value would depend on how much weight would be left after a recut.
I'd call someone with a reputation for recutting diamonds like Brian Gavin www.briangavindiamonds.com and ask him how to proceed.

That seller would make more money if she/he sold it to someone ignorant about good cut.
;))
 

diamondseeker2006

Super_Ideal_Rock
Premium
Joined
Jan 11, 2006
Messages
55,805
The value of the stone is impossible to guess without an independent appraisal as others have said. The information provided tells me that it would not be worth buying at any price, unless as others said, it would be a candidate for a recut. But the recut size might be 1.5 cts. or even less, so that would complicate trying to determine a value. I'd probably be tempted to consider it if the price was $5000. But still wouldn't buy without an appraisal to be sure the stone is even real.
 

Haven

Super_Ideal_Rock
Joined
Feb 15, 2007
Messages
13,166
People are telling you not to buy this stone from a friend because you asked about its "value" which is a relative term. To many of us here this particular stone isn't well cut enough to purchase, and therefore it isn't worth anything and we're telling you to pass on it.

Your friend can (and should) have the stone appraised, which will give her and any potential buyers insight into its appraised value.

HOWEVER, a stone's appraised value is very different than the price she should set (and expect to get) for her diamond when selling it to a friend. That value will be much lower than the appraised value.

And then, of course, there's the question of whether this stone would really be worth *anything* at all to an informed consumer who is looking to purchase a well-cut diamond.

If all you're looking for is a third-party appraisal of this stone's value--call an appraiser! If that is truly the only information you're looking for, you're going to get much more than what you want here on PS, we have a lot of opinions and we approach these sorts of questions from all possible angles. :bigsmile:
 

dreamer_dachsie

Super_Ideal_Rock
Joined
Dec 16, 2007
Messages
24,364
Have it appraised by an independent appraiser whom you choose, and then ask for their estimate for the resale value of the diamond. Or else go 30 - 50% of the retail appraised value.

But I would not buy it.
 

denverappraiser

Ideal_Rock
Trade
Joined
Jul 21, 2004
Messages
8,790
Dreamer_D|1307762256|2943078 said:
Have it appraised by an independent appraiser whom you choose, and then ask for their estimate for the resale value of the diamond. Or else go 30 - 50% of the retail appraised value.
Trying to convert 'appraisal' values by applying a forumla like this is a dicy proposition. Appraisers do not all use the same methodology and not all appraisals are using the same definition of value even when they come from teh same appraiser. The solution is to hire YOUR OWN appraiser if you're looking for advice on the value proposition and start yoru appraisal session with a discussion of what it is that you're trying to learn. There is no such thing as an 'appraisal value' and 'retail' can mean all manner of different things to different people. Appraisals have value conclusions that may or may not be useful information but these value conclusions simply don't stand alone in isolation.
 

dreamer_dachsie

Super_Ideal_Rock
Joined
Dec 16, 2007
Messages
24,364
denverappraiser|1307763541|2943092 said:
Dreamer_D|1307762256|2943078 said:
Have it appraised by an independent appraiser whom you choose, and then ask for their estimate for the resale value of the diamond. Or else go 30 - 50% of the retail appraised value.
Trying to convert 'appraisal' values by applying a forumla like this is a dicy proposition. Appraisers do not all use the same methodology and not all appraisals are using the same definition of value even when they come from teh same appraiser. The solution is to hire YOUR OWN appraiser if you're looking for advice on the value proposition and start yoru appraisal session with a discussion of what it is that you're trying to learn. There is no such thing as an 'appraisal value' and 'retail' can mean all manner of different things to different people. Appraisals have value conclusions that may or may not be useful information but these value conclusions simply don't stand alone in isolation.
Well there you go, straight from the "horses" mouth 8)

If the OP gets a GIA cert he/she can also look up comparables online to get a feel for retail value. That is likely what I would do so i did not need to monkey with figuring out all the nuances of an appraisal.
 

Amys Bling

Super_Ideal_Rock
Joined
Jun 25, 2010
Messages
11,025
Without a cut grade and more information it is difficult to impossible to give you comparablesor fair purchase price. Best advice is to get an appraisal and ask them to evaluate the cut.
 

fmzip

Rough_Rock
Joined
Feb 22, 2011
Messages
83
Thanks for the information thus far. She believes it was on their homeowners policy appraised at $14k. What does it cost to get a stone recut?

What I find very interesting in this thread that the consensus seems to be this 1.84CT is worthless from the sounds of it, that it's not even worth buying, pass on it all together without any price being mentioned???? So if she says she want's $2K for it, pass?? Even if I think it looks beautiful as is? That's seems foolish...
 

slg47

Ideal_Rock
Joined
Apr 4, 2010
Messages
9,667
fmzip|1307801537|2943235 said:
Thanks for the information thus far. She believes it was on their homeowners policy appraised at $14k. What does it cost to get a stone recut?

What I find very interesting in this thread that the consensus seems to be this 1.84CT is worthless from the sounds of it, that it's not even worth buying, pass on it all together without any price being mentioned???? So if she says she want's $2K for it, pass?? Even if I think it looks beautiful as is? That's seems foolish...
I would only buy it if it could be recut. Recuts cost approx. 350 per carat (I think). It may seem foolish to you but I would rather have a small well-cut diamond than a large one that does not sparkle as much.
 

kenny

Super_Ideal_Rock
Premium
Joined
Apr 30, 2005
Messages
28,682
fmzip|1307801537|2943235 said:
Thanks for the information thus far. She believes it was on their homeowners policy appraised at $14k. What does it cost to get a stone recut?

What I find very interesting in this thread that the consensus seems to be this 1.84CT is worthless from the sounds of it, that it's not even worth buying, pass on it all together without any price being mentioned???? So if she says she want's $2K for it, pass?? Even if I think it looks beautiful as is? That's seems foolish...
A recut will be a few hundred dollars.
Call Brian Gavin and ask for a closer ballpark idea, but he will likely tell you he has to examine the stone in person.
The phone call will take 10 minutes and you'll learn a lot and you are under no obligation.

The big unknown is how much weight loss there would be.
If it fell from 1.8 to 1.4 ct, here's a 1.4 F SI1 Bluenile Signature Ideal Cut, their best round cut.



Today's Bluenile price is $14K.
If there was no recut needed on your friend's stone I'd offer maybe 70% of this $14K, or $9,800.
But then I'd subtract $800 for the recut and a new GIA report, or $9,000.
But then there is a tiny risk the stone explodes on the cutting wheel.
This would be a total loss to you so I'd factor in that risk by knocking off another, say, $1,500, resulting in an offer price of $7,500.
Brian may be able to evaluate how risky this stone is for a recut.

Then again there may be one single inclusion that made it SI1 that will be polished off in the recut, transforming this SI1 into an IF diamond, in which case I might give the seller their asking price in cash immediately since Bluenile has a Signature Ideal Cut 1.5 F IF for $33,000.

As you can see arriving at a price when so much is unknown is a crap shoot with thousands of dollars on the table.
It may explode in the recut and all your money vanishes, or he may polish off the single inclusion and you end up with a $20,000 profit.
Now can you see why nobody here is willing to answer your "simple" question, "What's it worth?"?
We know too much.

But if you insist on buying it at least get it to someone who can verify it's a real diamond and the report matches the stone.
Some jeweler's will do this for free or a small fee.

Now that you are better informed you can see why this seller would make more money from an ignorant buyer.

Screen shot 2011-06-11 at 8.15.13 AM.png
 

denverappraiser

Ideal_Rock
Trade
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Jul 21, 2004
Messages
8,790
fmzip|1307801537|2943235 said:
Thanks for the information thus far. She believes it was on their homeowners policy appraised at $14k. What does it cost to get a stone recut?

What I find very interesting in this thread that the consensus seems to be this 1.84CT is worthless from the sounds of it, that it's not even worth buying, pass on it all together without any price being mentioned???? So if she says she want's $2K for it, pass?? Even if I think it looks beautiful as is? That's seems foolish...
How much she has it listed for on her insurance is completely irrelevant both to how much she can expect to get for it if she markets and sells it and how much you should bid as a potential buyer. Actually, it’s only barely relevant to how much her insurance company will pay in the case of a loss.

Recutting diamonds is not a task for the faint of heart. Yes, there’s money on the table if the price is right but there are significant costs, there are significant risks, there are important and non-obvious questions to consider in terms of what you want to do. If you love the stone as it is and the price is right, do it, but I would leave the cutting business to the pros or at least amateurs who have been through this process a few times before. Think of it in terms of buying a used car and considering buying one where you’ll need to replace the engine before you can drive it. It’s certainly possible that this could work out well but there is significant potential for trouble and I would not suggest it as a plan unless you’re really into cars and you really know what you’re doing.
 

diamondseeker2006

Super_Ideal_Rock
Premium
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Jan 11, 2006
Messages
55,805
Brian will absolutely NOT guarantee the stone will come out to be AGS0 or hearts and arrows. A better price comparison would be something between a GIA Excellent and Very Good cut, in my opinion. The better the cut at the outset, the closer it may get to AGS0. This stone isn't that well cut.

The placement of the inclusion would also have an effect on the value. If the inclusion was eliminated, then it might get a higher clarity grade. Or the recut might cause the inclusion to be more prominent. There is just no way to put a value on this stone as far as recutting goes unless the friend will allow the stone to be sent to Brian with no obligation to buy.

There is a price I would pay after a recut evaluation. But there is no way to know if it will end up being ideal or excellent cut, 1.3 or 1.5 cts. etc. That's why we can't tell you a price. But I think I said before that if she wanted to sell it for $5000, I might do it if I could at least have a jeweler/appraiser look at it with a loupe and verify that it matches the lab report. Plus I'd need to see the inclusions myself to see how I think a recut might affect them and then have Brian look at it before paying money.

If you like the stone as is, I wouldn't advise you to pay more than $5000, but please have the stone verified as matching the report before buying.
 

canuk-gal

Super_Ideal_Rock
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Apr 19, 2004
Messages
20,850
fmzip|1307801537|2943235 said:
Thanks for the information thus far. She believes it was on their homeowners policy appraised at $14k. What does it cost to get a stone recut?

What I find very interesting in this thread that the consensus seems to be this 1.84CT is worthless from the sounds of it, that it's not even worth buying, pass on it all together without any price being mentioned???? So if she says she want's $2K for it, pass?? Even if I think it looks beautiful as is? That's seems foolish...
HI:

This is very telling. PS is a consumer forum--hence the information given here is provided for HER/YOUR protection!

cheers--Sharon
 

suchende

Brilliant_Rock
Joined
Apr 14, 2008
Messages
1,001
denverappraiser|1307811750|2943323 said:
fmzip|1307801537|2943235 said:
Thanks for the information thus far. She believes it was on their homeowners policy appraised at $14k. What does it cost to get a stone recut?

What I find very interesting in this thread that the consensus seems to be this 1.84CT is worthless from the sounds of it, that it's not even worth buying, pass on it all together without any price being mentioned???? So if she says she want's $2K for it, pass?? Even if I think it looks beautiful as is? That's seems foolish...
How much she has it listed for on her insurance is completely irrelevant both to how much she can expect to get for it if she markets and sells it and how much you should bid as a potential buyer. Actually, it’s only barely relevant to how much her insurance company will pay in the case of a loss.

Recutting diamonds is not a task for the faint of heart. Yes, there’s money on the table if the price is right but there are significant costs, there are significant risks, there are important and non-obvious questions to consider in terms of what you want to do. If you love the stone as it is and the price is right, do it, but I would leave the cutting business to the pros or at least amateurs who have been through this process a few times before. Think of it in terms of buying a used car and considering buying one where you’ll need to replace the engine before you can drive it. It’s certainly possible that this could work out well but there is significant potential for trouble and I would not suggest it as a plan unless you’re really into cars and you really know what you’re doing.
In threads like these, it's occurred to me before that the best course of action is to take it to a few pawn shops/whoever else buys used diamonds so the "market value" picture starts to emerge, and then make an offer above the best deal the friend is made.
 

denverappraiser

Ideal_Rock
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Jul 21, 2004
Messages
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<soapbox on>

I hate to sound self-serving as an appraiser here but the goal seems to be to avoid appraisal fees no matter how much it costs the participants to do it. She (the seller) badly needs to understand both what she’s got and what her prospects are. Appraising isn’t rocket science, it’s just research, observation and report writing and she can certainly do it herself if she has the temperament, the talent and the tools, but she obviously doesn’t want to do this. A survey of pawn shops is a research approach but I would not describe it as particularly good unless she’s previously figured out which are the best shops to ask and knows how to ask the question in a way that produces the highest answer. Another free approach is to post it on craigslist for a lot of money and compare the offers you get (if any). The current plan of relying on an unknown opinion given on an unknown date by an unknown appraiser using unknown methodology for a completely different purpose is nuts on it’s face. I understand consumers don’t understand the subtleties of the appraisal business but the seller here is taking a VERY dangerous tack and professional assistance would be of enormous benefit.

The same holds for the buyer. She wants to land on a value using free advice without knowing most of the fundamental details about either the stone or the marketplace. Just a ballpark estimate. There’s a ‘fudge factor’ in play here that’s something like $10,000 and the whole point seems to be to avoid an appraisal fee that’s probably going to be under $100. That’s nuts.

The seller should get it appraised. Immediately would be a good schedule. She may or may not want to show this report to potential buyers but SHE needs to know what’s going on. She should choose an appraiser based on whatever criteria she wants but she should choose one where she can interact directly with the appraiser (rather than dropping it off at a store and picking it up again a week later) and she should be very clear in her session exactly what it is she’s trying to learn. What is it? What are the viable avenues for sales? What can she reasonably expect to get from a resale? Should she do anything to the piece to increase the marketability? What are the risks associated with the various options?

If the buyer is serious, SHE should get it appraised by HER chosen appraiser. Yep, that’s TWO appraisals here, and possibly more if there are several non-expert buyers who are competing with one another. Relying on a seller supplied document is rather like relying on legal advice from the opposing council. It may or may not be technically correct but somehow it doesn’t seem to work out in your favor. As with the above, it’s not a psychic power and she can certainly do the work herself as many here are inclined to do but she obviously doesn’t have that temperament and, frankly, doesn’t even seem to understand the issues at play. Professional assistance on what’s likely to be a fairly costly purchase would be very useful in this situation and probably not terribly expensive.

<soapbox off>
 

mrssalvo

Super_Ideal_Rock
Joined
Jan 3, 2005
Messages
19,132
I'd suggest she get it appraised and ask the appraiser to give a fair market value along with the appraisal value etc. She can decide what she wants to offer and the buyer can decide if that is fair. If I were a buyer I would also have my own appraisal done. It's worth the $100-$150 if I'm going to drop 5K or greater on a stone from a private seller with little information on the diamond. Same if I were buying a used car from a friend. I'd want my mechanic to check it out and tell me I'm getting a good deal. If it were I friend I'd want to pay them a fair price as well. Since I know nothing about cars or diamonds I need to enlist the help of a professional in either case.
 

Dancing Fire

Super_Ideal_Rock
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Messages
32,068
I'd suggest she get it appraised if the stone appraised as a F SI1 then i would offer her $7,000-$7500
 
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