Jewelry Appraisals

[Joe241]

I just got my diamond from WF today and I am really, really happy with it and I think my girlfriend will be too. I am going to get it appraised tomorrow (along withe the ring I will be buying) and I just wanted some insight into what to expect.

The independent assessment WF sent with my ring said its value was approx. $3900 which is $1400 more than I paid. Is this how jewelry appraisals always work? Why on earth would a diamond I just bought be worth something significantly different than what I just paid for it? The ring I''m buying is $2500 - is the "value" of that going to be inflated as well?

Thanks for your help!

 

[Richard Sherwood]

Joe, most appraisals are usually priced at the average retail level of the average jewelry store, not at the selling price of internet vendors.

Internet stones are usually priced below "average retail" because the internet vendors don't have the overhead of the average jewelry store.

If you want your diamond appraised at the "internet retail level", then let your appraiser know beforehand.

You might be hurting yourself if you do that though.

Let's say you lose the diamond five years down the road, and you opted for internet retail level when you insured the diamond five years previously. Let's say that diamond prices appreciated at an average of 4% a year, and you paid and insured the diamond for the original selling price of $2,500.

In five years, it might cost you $3,100 to replace that diamond. So here you would have been faithfully paying premiums for sixty months, yet still have to shell out and additional $600 (plus the deductible) to replace your diamond. Ugh.

 

[denverappraiser]

Any statement of value must contain an element of what something is worth to whom, when and under what circumstances or it’s not useful information, and the whole point of seeking out an appraisal is to gain some useful information. The usual purpose of a jewelry appraisal is to document exactly what you have and to provide appropriate funding so that your insurance company can replace the piece with another of ''like kind and quality'' new and in the local retail marketplace . This is probably what the report you have is attempting to describe. The first step in any appraisal assignment is for the appraiser to discuss this issue with the client and to establish that both the appraiser and the client understand what question is being asked. Without this it’s useless. Answering the wrong question, even if the answer is correct in it''s own context, is doing you no favors.

The appraisal report should explain in the body of the report both the marketplace being described and the definition of value being used.

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver