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real or fake appraisal

Discussion in 'RockyTalky' started by jewelryrat, Apr 30, 2005.

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  1. jewelryrat
    Rough_Rock

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    by jewelryrat » Apr 30, 2005
    AIG appraisal values do not comes out. Not on one but three different items. Are their appraisal worth the paper they written on??
     
    


    


  2. RockDoc
    Ideal_Rock

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    by RockDoc » Apr 30, 2005
    Dear JewelryRat


    What are you referring to as "does not come out"?

    Are you speaking of the gemological conslusions as to grading or quality of the stone, or are you refering to the value.


    There are other criteria too...

    Does the appraisal have with it a statement of independence?

    Did the seller provide ( and pay for) the report?

    Does the person who wrote the report list his qualifications in it?

    Is the person a gemologist?

    Does the person have appraisal education and credentials.

    Is the value specifically describe what the value is for, and how it was arrived at? Does it disclose which market is reported?

    Does it specify market conditions and desrireability of the item?

    Does it report the quality and type of manufacture for jewelry ?

    Does it describe what gemological testing procedures and equipment used to determine the grading ?

    If it is for jewelry, does it state whether or not the items were graded in the mountings?


    Let''s start with these answers, then we can better render an opinion...


    Rockdoc
     
  3. oldminer
    Ideal_Rock
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    by oldminer » Apr 30, 2005
    Yes, tell us more, please.
     
  4. jewelryrat
    Rough_Rock

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    by jewelryrat » May 1, 2005

    Does the appraisal have with it a statement of independence? Yes.



    Did the seller provide ( and pay for) the report? The seller provided the report. I called to verify it authenticity.



    Does the person who wrote the report list his qualifications in it? Is the person a gemologist? Does the person have appraisal education and credentials? Gemologist GJG GIA & Gemologist M.Sc.



    Is the value specifically describe what the value is for, and how it was arrived at? Yes, it gives a specific value.



    Does it disclose which market is reported? No, it does not disclose a market report.



    Does it specify market conditions and desrireability of the item? No.



    Does it report the quality and type of manufacture for jewelry? It does give a quality report.



    Does it describe what gemological testing procedures and equipment used to determine the grading? All reports use GIA standards.



    If it is for jewelry, does it state whether or not the items were graded in the mountings? All stones were graded loose.



     
    


    


  5. RockDoc
    Ideal_Rock

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    by RockDoc » May 1, 2005


    Does the appraisal have with it a statement of independence? Yes.
    Interesting.... if the appraiser was paid for by the seller, just who''s interests are primarilly served?

    Do you really think YOUR interests were at heart by the appraiser?

    Did the seller provide ( and pay for) the report? The seller provided the report. I called to verify it authenticity.
    Ultimately, I am reasonably sure that the cost of this document was included in the price you paid, so in the end you have paid for it.

    Considering this do you feel any question as to the credbility and accuracy of the information and values provided to you. Since you wrote "they don''t come out".. I would assume that you don''t feel this way. You also state they supplied an appraisal for three items and none of these "came out". Were they all paid for by the seller?

    Does the person who wrote the report list his qualifications in it? Is the person a gemologist? Does the person have appraisal education and credentials? Gemologist GJG GIA & Gemologist M.Sc.

    Those are viable educational credential for a gemologist, but nothing you''ve stated has anything really meaningful for appraising.



    Is the value specifically describe what the value is for, and how it was arrived at? Yes, it gives a specific value.

    What is that value? Insurance etc.? If it says Retail Replacement Value as many do, it should define exactly what that means. Is it the replacement value to a consumer buying the item is WHAT kind of retail store, or is it the Retail Replacement Cost that an Insurance Company would pay.



    Does it disclose which market is reported? No, it does not disclose a market report.

    To answer this in a broad fashion.... theoretically the same or comparable item could be sold by a pawn shop or flea market retailer, all the way up to a Fifth Avenue type store, such as Cartier or Tiffany etc. and of course every where in between. An appraisal done professionally should define this so that any forseeable party would know what the facts are.



    Does it specify market conditions and desrireability of the item? No.
    If you''ve got an unusual item, that is difficult to replace, many appraisers just "pack" the value "so that there is room for a claim settlement". Some issues that should be defined in the report are :

    Is the item in fashion vogue
    Is the quality of the stones in a limited in supply?

    Could there be an impending price increase?

    I could think of lots more questions, but I don''t want to make this "unendless"

    Does it report the quality and type of manufacture for jewelry? It does give a quality report.
    Here I am referring to how the ring was made... Such answers (but not all) - cast / soldered, assembled, die struck etc.

    It should state a quality of workmanship and condition ( new, used, damaged etc) as well.

    Does it describe what gemological testing procedures and equipment used to determine the grading? All reports use GIA standards.

    It is good that they disclosed a standard in their report.



    If it is for jewelry, does it state whether or not the items were graded in the mountings? All stones were graded loose.
    That is good too, that it is on the report. If it turns out later the grading wasn''t accurate, the gemologist doing the report can''t make an excuse that he didn''t see the inclusions, or was incorrect with the color grade, or proportions due to the limitation of examining a stone that was graded.


    I haven''t covered every issue here, so I will let the other appraisers chime in,with their opinions.


    Rockdoc
     
  6. denverappraiser
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    by denverappraiser » May 2, 2005
    For an appraisal to be ‘worth the paper it’s printed on’, it must provide some information that is both truthful and useful. I suspect that document that you are examining may fail on the later standard but without seeing both the piece and the report it’s not really possible to address the accuracy of their gemological findings. How useful it is will depend on several things.

    Useful to whom? From the appraisers standpoint, this is clear: Useful to the client. I point this out because you were not the client. You probably don’t even know who it was. A properly done appraisal should clearly state who the client is and what was their stated purpose in the assignment. This is important because not all valuation questions are the same. The question being asked of the appraiser may not be relevant to what you are hoping to learn by reading it. Actually, in this case it’s probably not relevant. For the AIG appraisals I’ve seen, the question being answered is something like “What would be the retail asking price at a theoretical retail jewelry store for an item that looks sort of like this one?” Is this what you’re trying to learn? Notice that the store in question doesn’t need to be making any actual sales at this price, only that they have the stones to write it on a price tag. It's up to you to decide if this is useful. For most 3rd parties, it's not.

    Useful for what? Again, this should be clearly stated in the document itself. Most clients who are buyers are seeking some sort of confirmation that the item they are buying has been accurately described and priced appropriately. Clients who are sellers are usually looking for info that well help them establish their prices. To be useful, an appraisal must contain a description of the subject property. This description will have some of the physical attributes of the item. Things like the weight, clarity and color of the center diamond are often included. Is this description sufficient for your purpose? It’s simply not possible to list everything there is to be known. The key is to list everything that is relevant to the valuation questions. For some purposes, it is sufficient to list the weight and number of the items (ex. 3 used file cabinets in a residential contents appraisal could reasonably be described as ‘3 used file cabinets’ with no additional information) while in others it is necessary to include excruciating detail. In most jewelry appraisals it’s desirable to have a fair amount more detail than this. This too is a case where you must decide if sufficient information is included the the report to be useful for your application.
    What is value? An appraisal will contain an opinion of value. This means that they are making an estimate of how the item should be expected to behave in a particular marketplace. Not all markets are the same. Asking an appraiser what you could get for a ring at a pawn shop is not the same question as asking what should be a fair price to have it custom made at a local store although both are valid questions. Asking how much it would cost to knock-off a designers work is not the same question as asking what the designer charges for that model. I presume from your statement that the values presented in the report ‘do not come out’ that these numbers don’t accurately describe some market that you’re involved in. Since the report apparently doesn’t indicate what market they are describing, why are you surprised at this? What’s a cup of coffee worth? Not enough information, right? Ok, 350ml of dark roast served at 122 degrees with 3ml of cream? This will range from free to over $10 depending on details that I still didn’t include. Would an appraisal that says it’s “worth” $10 be useful?

    Whose opinion? An opinion is only as useful as the person giving it and the quality of data that they are using. This is the reason that an appraisal should contain a clear statement of who the appraiser is, what data they are using to draw their various conclusions and where and how they came by that data. GIA is a school for gemology, the study of gemstones. It’s a pretty good school and most jewelry appraisers in the US went there. The credentials you’ve listed indicate that the person described has at least an introductory knowledge of gemstones. Good. They may be very skilled - they may not. What you’ve listed does not include an appraisal credential of any kind. To be fair, credentials only get you so far. Unfortunately, the fact that someone graduated from a prestigious school doesn’t mean that they actually learned anything there any more than it means that they are a fool if they didn’t. It’s a helpful indicator but that’s all. Appraise the appraiser.

    Appraise the appraisal. There should be a section of the appraisal report titled ‘limiting conditions’ or something similar. This is where they will indicate issues like a requirement to examine the stones in the mounting, that they may have been restricted on the amount of available time or that they didn’t have access to the appropriate equipment (like lighting) at the time of the inspection. An opinion of an appraiser based on an examination in a bank vault where they had fluorescent lighting, a 10x loupe and were given 5 minutes for examination may be useful for some purposes but it may not be answering what you want to know. The appraiser hopefully answered what the client needed to know (for example ‘how many stones are in the safe deposit box and are they diamonds’) but remember, you were not the client. They may not have asked the same question that you are. The document is not the appraisal. The appraisal was the process of examination, research and reporting. The report is exactly that, a report.

    Neil Beaty
    GG(GIA) ISA NAJA
    Independent Appraisals in Denver
     
  7. newenglandgemlab
    Shiny_Rock

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    by newenglandgemlab » May 2, 2005
    Hi all,

    No need to reiterate...well written! Cindy
     
  8. jewelryrat
    Rough_Rock

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    by jewelryrat » May 2, 2005
    So, am I to understand take an appraisal can be suited to any condition base on the questions asked and not the item''s quality or lack thereof. I know it''s an apple. What I don''t know is what kind of apple it is. I depend on the imformed to aid in my education. When that information is misunderstood the education is not complete.

    I feel there is a need for apology, I did not intend to insult or malign anyone or any profession. I''m just trying get a laymans hint as to why or how. On reflecion I should have rephased my question. To any and all I heartfully apologize and appreciate your response, Thank you.
     
  9. denverappraiser
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    by denverappraiser » May 2, 2005

    Jewelryrat,


    No apology is necessary. This is a very common set of questions and both consumers and ‘appraisers’ regularly misunderstand both the appraisal process and what can and cannot be learned by reading a report. The items quality or lack thereof MAY be the subject at hand but it’s not necessary. That’s why it’s so important to explain in the report what the issues are. Many appraisal reports are more than a dozen pages long while others will fit on a credit card. The later are usually quite a bit less expensive but it both cases it’s necessary to decide if this is appropriate for the purpose at hand.


    In your fruit example, a report that you have an apple would be true and, for a client who didn’t already know this, perhaps even useful. If this is all they really wanted to know, it would be inappropriate to charge them for DNA testing to determine the lineage of the tree, even if the appraiser is prepared to do this. If a potential buyer is interested in evidence that the apple isn’t diseased, then the appraiser hasn’t said anything useful (to them) and their report should be ignored as irrelevant. This is not a disparagement of that appraiser. It’s true even if that appraiser is equipped and capable of doing the proper disease test. The buyer may very well consider hiring them to do their own examination with a different purpose and get a completely different report. Neither is it an endorsement. Most people can properly identify it as an apple. The disease test is considerably more difficult and probably more expensive. The fact that they correctly identified an apple doesn't really tell you much.


    Items accompanied by AIG appraisal reports are regularly sold on ebay for prices that range from 1%-10% of the stated value. For most people, a report where an appraiser has listed a price to within a factor of a hundred isn’t very helpful nor are pricing suggestions for a theoretical jewelry store that may or may not exist on this planet.


    Neil Beaty
    GG(GIA) ISA NAJA
    Independent Appraisals in Denver
     
  10. oldminer
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    by oldminer » May 2, 2005
    You have some pretty good answers concerning this appraisal company. One can't rely blindly on good looking or even lengthy documents. One should research the integrity of the appraisal firm and this is what is being done by the consumer who posted the question.

    Asking "who paid for the appraisal" is a valid question, but one must use common sense in response to the answer. Nearly every seller pays for an appraisal used as a selling tool. This happens at the largest, most respected auction galleries, in nearly every real estate transaction and all over the sorts of auctions that occur on the Internet. THE POTENTIAL OF A BIAS EXISTS for all such work, but much of it is 100% legitimate and honest. Depending on the venue, a percentage is dishonest and truly biased. It is enough to raise a red flag over the entire subject, but it does not mean all appraisals performed are biased to give the person who paid an advantage. To constantly wave this red flag makes consumers aware and also creates a fear of dishonesty which is not as prevalent as one might infer from the amount of warnings. With the pricing abilities of Pricescope you can get around the value issue pretty quickly on simple diamonds. It eliminates a lot of the fear of the unknown.

    An honest appraisal may come from an appraiser who was paid to do their job properly. One needs to appraise the appraiser and not make a blanket assumption of dishonesty because any particular party paid for an appraisal. Sure, it is best if YOU have YOUR appraiser do your work and you pay that person, but there is plenty of honest work being done without regard to who paid who.

    Ask the right questions. Check out the reputation of the appraiser of your choice. Check out the reputation of the appraiser who already did the appraisal being offered rather than blindly trust it. What you ought not assume is that everyone is out to get you or that the appraisal guys are all in the pockets of their dealer customers. Honest people just don't sell out for an appraisal fee.....
     
    


    


  11. strmrdr
    Super_Ideal_Rock

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    by strmrdr » May 2, 2005
    In a lot of area these days not just jewelry its a lot safer to assume that everyone is out to get you.
    Because in most cases they are.

    There are a ton of appraisals out there that aren’t worth the paper they are printed on.
    An honest evaluation would likely find that the vast majority fall into that category.
    Locally I don’t know of one place that could pass rockdocs test.
    In the Chicago area 65-75 miles or so from here there are 2 that might and one of them has got bad reviews on PS.
     
  12. RockDoc
    Ideal_Rock

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    by RockDoc » May 2, 2005
    Very well explained Neil.

    I did want to comment maybe a little more "severely" about the theoretical store scenario.


    As you mention, the reliance on a valuation report, needs to be seriously considered by the readers. However how many consumers have actually seen a really complete report, so that the have a basis of comparison can really be accepted or questioned.

    You''ve written a very detailed description in this post and other ones posted elsewhere in the site.

    My point of being totally independent and unbiased is not to accuse other appraisers of dishonesty, but to an "outsider" anything that could be viewed as questionable is the issue that needs to be considered by any readers relying on the information contained therein.

    As storm points out there are far more appraisals that are incomplete, particularly those that are the credit card types. One other measure is how many appraisers find out the claim settlement details before choosing which markets/market levels, modes/ or values that parallel and are consistent with the terms of the policy for the assignment at hand?

    A value in a theoretical store seems to me like Alice in Wonderland scenario. Careful, logical thought in the analysis of this, leads me to make no other conclusion, as to its validity. If the store doesn''t exist, how is a purely theoretical value have any relation to how the client''s insurance company will settle a claim ( this of course for an insurance use only)? A point in case would be, what good is a value that represents the insurance company''s cost to replace for an As Agreed ( Chubb type policy) or Agreed Value policy?

    How can ANYONE produce a useful and worthwhile document before knowing how the client or any additional forseeable users of the report, before knowing the details of the details of how the insurance company is going to specifically address this in advance of the purchase being made, when it is the seller who is the primary client? How many are issued primarilly using "for insurance purposes" when in factual truth it is no more than a selling tool to support the client''s sale or priced charged for an item. Such reports should CLEARLY state to readers that are using this type of that the report of "imaginary and theoretical" jewelry store markets, don''t apply. I shudder to think just how many of these have been relied on by innocent consumers at the behest of sellers when they really are not useful in addressing the needs of the consumer or his insurance company.

    I have authored reports that for the replacement type policies, have several values when the policy conditions or the statement by the agents are broad. It isn''t the within apprasier''s "powers" to just pick a value, and "force" the client and the insurance company to agree and base the coverage on that. It is the appraiser''s charge to report information and let the client and the insurance company be informed and let each agree on what the insured amount that is selcted from the information provided should be.

    Currently, I have a legal matter that involves an appraisal, where there is a Statement of Independence, but was authored by a gemologist (again, with NO appraisal educational credentials) who is an employee of the store. Now the issue is would the report be considered as unbiased and independent per the disclosure of Independence made. The attorney in this matter HIGHLY questions the independence and validity of this report. He thinks that this borders on being comedy. What is even more interesting is that the appraiser has adopted many of the "boilerplate" terms and conditions used by the appraisal societies, but demonstrates a clear absence of knowledge and experience of how to apply these issues. So to a novice, it looks like it might be professionally written, but it is sorely lacking addressing the relevant issues and methodology of the assignment. This become far more apparent when reading the legal definitions of appraisals.

    Hopefully, this thread is being read by consumers, because it is certainly educational and informative of what the consumer should know in communicating their "desires" with the appraiser and understanding what is or isn''t on their reports, and if they really address the uses intended.


    Rockdoc
     
  13. webegemman
    Rough_Rock

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    by webegemman » Aug 15, 2005
    Hey all,

    This may be coming a little late after your last few posts, but I just came across this thread. I feel a need to come to the defense of AIG, even though many of you seem to be saying they MAY be ok.

    I can assure you they are. Yes, I am a retailer and yes I used AIG in the past. I was even forced to Prove the values because of where I was selling. (I''d tell but I am not at liberty at this time.) Let''s just say it was a Mall-like environment and the owners/management of the environment were unsure of the values stated on the AIG appraisals.

    I chose AIG because they have a History and from what I had heard, a respected reputation. I sent the pieces (the first time), with just a note stating I wanted these pieces appraised with an estimated retail value. I used My name on the mailing label, not my store name, and never mentioned if I was a retailer. The pieces came back with values that seemed very reasonable for the items... some were a little below what I charge and some were a little above. I decided to send all my high end items to them but decided to call and talk to them.

    Norm Monteau has been an appraiser for many years and has and still does appraisals for many " Big Name" jewelry stores in the US and Worldwide. This is where they get their values from when they do appraisals. They know the owners/Proprietors of these stores and knows what they sell the items for and knows where he appraised them at. He can then therefore adjust his appraised values to fall inline with the general/average jewelry store in the area of the country you live in. They (AIG) also can do appraisals based on Insurance Replacement Value and is recomended by several insurance companies. They also give just Quality Assurance Reports. They do not give Retailers Sales Tool Appraisals and Buyers True Value reports.

    To sugget the value is inflated to be used as a sales tool BECAUSE the appraisal was paid for by the seller is accusatory and bordering on defamatory. As I stated above, I decided to send other items to them and again, all items came back inline with what I sell the items for or what my competitors sell them for.... No you''re correct... I do not often SELL them at those prices... I stand corrected, They are my TICKET prices! If the consumer does not question, ask or waffle on purchasing I do not drop my price but most do. I give my sales people a margin, but that affects their commissions as well.
    But back to having to prove "my" appraisals to the managment of the "mall envirmonment" My establisment is in, I had over 50 pieces REAPPRAISED by 3 other appraisal companies, Then took a video camera to over 25 retail establisments and asked for three items that were the same I sell (Style and grade of stones included). One establisment had three locations in the area and I went to all three to show the first was not a fluke.. but their tag price was more than TWICE what AIG appraised a similar item for and only came down 25-35%... That''s still a huge drop, but showed they had a HUGE mark-up and also that AIG was IN LINE! Some of the other stores were either right inline or quite a bit above. NONE were below the AIG value for similar grade and quality items. Now I''m sure if I checked jewelry stores in North Dakota somewhere or a variety of Pawn shops and flea markets, then yes, I probably could find dealers selling below their values.. like wise, if I checked jewelers on Rodeo Drive or in Beverly Hills, Palm Beach or Boca Raton, their values would be higher too. Just go into Bvlgari and check what they charge for... say a Tourmaline necklace! Just because it''s Bvlgari!

    Some of my Wholesalers have suggested retail values on their tags and they are also inline with AIG values. If any of you (jewelryrat excluded), have ever gone to a Jewelry show (industry only) then you know you can find identical pieces from different Dealers at Dramatically different prices! For example, I have one dealer I deal with that I just saw at the NY Jewelry show at the Javitz center, and I purchased a Sapphire and Diamond Ring from him for $420. I went several booths away and saw the same exact ring. Of course I had to ask the price... $1400! HUGE difference and that''s among DEALERS! So WHY is it so hard to believe appraised values?

    Anyway, The powers that be were more than happy with the verfication I provided. I will say there are questionable appraisers out there and you really do need to do some homework. I ALWAYS tell my customers, if they decide to have the pieces reappraised, use a Third Party Idependant appraiser, NOT a Retailer (local jeweler) who 9 times out of 10 bash the piece if they did not sell it.

    Yes, I have found appraisers that I did not use, mainly because I felt their appraisals were unprofessional looking and did not provide enough information or what I felt were appropriate/fair values. One guy even taped a poloroid photo of the item on the appraisal and then photo copied it and used that as the final copy.

    I have friends in the Caribbean as well, and they have told me of cruise passengers that buy on the islands, take the pieces home and have them appraised, THen complain that the pieces only appraised for what they paid for the item or within a few hundred dollars! They seem to have expected to buy jewelry at wholesale prices in the caribbean. The only place I''ve found the retailer can pay near wholesale prices is online... mainly because there are wholesalers that are now selling online and on... of all places... EBAY [​IMG]
    EBAY is going to really hurt the industry. I have seen a supplier I used (past tense) Now selling on ebay! Unfortunately, there are also guys that get into the business, buy the items at wholesale, then list them and are happy if they recover their cost with just a few extra dollars to spare! I suppose if you sell 500 pieces a week and only make $5 a piece you''re doing better than most people. I''ve looked at Ebay and have even considered buying some items from their myself and putting them in my store!

    Well, I could go on forever, but you probably wont read it all. Appraisals are based on Opinions. You Do have to do your homework and I agree, appraise the appraiser, which I could not have done any better with AIG.
     
  14. lmurden
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    by lmurden » Aug 15, 2005
    Wow, this is very informative! [​IMG]
     
  15. oldminer
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    by oldminer » Aug 15, 2005
    webegemman:

    Nice long posting about your trust of AIG. It seems pretty much that you TRUST this firm and have no issue with this faith. I would simply say that your own faith is fine, but it would not be a good thing for people to blindly hope for your good luck to follow them in the same way. Nothing blatantly wrong with AIG so much as having blind faith in a private firm where profit is a motivating factor. I don''t tell folks to blindly "trust me" either. We try to prove our deserving nature all the time and it generally is a success, but we are not perfect. No one is.

    I think using an appraiser who is independent of the seller has much to recommend it over using what we''d call a "captive gemologist" who is paid by the seller and may not be as independent as we hope. My firm does this sort of work for retailers, too. I won''t deny it. We just make sure people are informed and are making smart choices about when to trust an expert and when to question them.......
     
    


    


  16. blitz
    Rough_Rock

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    by blitz » Aug 24, 2005
    Bidz.com Auction #10646005
    1.03 carat Round Brilliant
    I-2
    G
    $10,175.00 is the appraised value with signature of Norman Monteau.

    Defend this value.
     
  17. oldminer
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    by oldminer » Aug 25, 2005
    Jennifer:

    4 times the Rap Sheet for a retail value. That may be a new record! I wonder who is doing the "research"....... This does not leave much to doubt, does it. THANKS.
     
  18. webegemman
    Rough_Rock

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    by webegemman » Sep 19, 2005
    First off, I''d like to say, I don''t (or didn''t) have "Blind Faith" in AIG. They''re values are not more "accurate" than anyone elses''... but they''re also not any less accurate. I do feel they come in closer to the estimated retail (on ERV reports) than most though. I have spot checked their work with other independant appraisers (two to three reports for the same item in some cases), and they were spot on! I also checked prices for particular items in the Caribbean (10ct, SI1-I2, I-K Color Diamond Necklaces) and The Tag prices for the Big stores was $42K plus but they were usually willing to come down to about $18-20K because I was on a ship (yeah right). AIG had appraised similar items for us at $15-18K.
    So, If I had "Blind Faith" in AIG, I wouldn''t have done so much checking up on them. I also like the way they put together their appraisals... They look very professional. I have also referred friends and Family to them to have their personal items appraised, and they too come back inline with similar items my company has had appraised.
    If you do a search online for EGL, IGL, USGL and even GIA and you''re going to find situations where someone has a problem with their valuations. For Instance, why does a Diamond Cert from one of the above justify raising the value of a diamond? Because it''s grade is now "official"? for that matter, Any piece of jewelry that gets appraised should be worth more! and if it is, then there should be no problem with including the cost of the appraisal in the cost of the item! And if you''re buying the item and 10,20 or even 50% of appraised value... where''s your complaint? Lets say the appraisal is POSSIBLY double what it should be... then you paid retail... As you should if you''re not in the business!
    I talked about AIG because, if you go back to the original post in this thread, it is about AIG and their credibility... and as a customer of theirs, I felt it necessary to defend them... as I would hope they would me if someone wrote something disparaging about me and they discovered it. Also, when a customer of mine (or another jeweler that uses AIG or other service) decides to check out their appraisal and finds a thread like this, negating the value or validity of an AIG or any appraisal, Its a real disservice to the industry. If you''re unhappy with your ERV report, you can call and ask for an Insurance Replacement Value Report (IRV). It is much more accurate and you can usually get a list of Insurance companies that accept that appraisers reports. If that is STILL not good enough... Do the research on your own and visit as many stores as you can or check as many websites as you can looking for as many items as possible that are as close as possible to the item you have and judge from there.
    As for the Diamond on Bidz... unfortunately I was out of town for a while and just saw the post but the listing is gone... Did anyone confirm the appraisal? Was it a real appraisal? Just showing a picture of an appraisal with a value and a signature does not make it a real appraisal. Also, is the Rap sheet the price a regular person walking in off the street could expect to pay for a loose certified diamond? I agree, 4 times is a bit high and since I''ve had many diamonds appraised by AIG, I think that was either a bogus report (which does happen and is not difficult to make with photoshop) may have been an error but without having the appraisal number and questioning AIG on it, I can not say. They WILL answer questions about an appraisal if you give them the number.
     
  19. MissAva
    Ideal_Rock

    Messages:
    8,230
    Joined:
    Mar 6, 2005
    by MissAva » Sep 19, 2005
    FOUR TIMES IS A BIT HIGH????[​IMG]
     
  20. webegemman
    Rough_Rock

    Messages:
    3
    Joined:
    Aug 14, 2005
    by webegemman » Sep 20, 2005
    Yes... a Bit high! When The Rappaport price is the WHOLESALE Price, then what do You mark your stones up? Some stores mark up 2 times, some 2.5 some 3. It depends on the store, it''s location, the season... I''m sure there ARE some sellers that mark up 4 times but discount when asked... IF they can get away with selling at 4 times they do!.
    Like I said, the Internet is KILLING the Retail Jewelry business! There are people buying wholesale who are just interested in making a quick buck and are selling items for just a few dollars over cost! They''ve Obviously never been in the retail business.

    I have found prices for the Same ring (Sapphire and Diamond) from different dealers (wholesale) from $300 up to as high as $1200... And that was at a Jewelers Show! So What should Retail Be for that Item? If one Retailer buys the $1200 item and marks up 2.5x to $3000, is he way over priced? What if he''s on Rodeo Drive? What would his mark up be then? What if the jeweler down the street bought the same item from the $300 dealer... and STILL marked it up to $3000? That''s a 10x mark up but Still in line with what his market is asking for that item!
    I can buy a Tourmaline for next to nothing (compared to sapphires, Diamonds Rubies and Emeralds)... but if you go into Bvlgari and priced tourmaline necklaces, which range from $12,000 to $60,000 and up, You''d think Tourmaline is more expensive that Sapphires! And they''re not! But the name Bvlgari demands the price! Do you think they only mark up 2.5 times? Not on your Life!

    What''s Tiffany''s mark up on Sterling silver?

    What would you say is the normal mark-up on diamond from Rappaport?
    What if you''re in Beverly Hills? same mark up? (Dont'' forget your rent/overhead)
    What if you have a cert for the Diamond? and don''t tell me certified diamonds aren''t sold for more!

    Here''s a good example... go to this site http://www.diamondsourceva.com/ and on the right is a search feature. Just put in any grade of diamond and hit search. Look at what they say the difference between Retail, Wholesale and Their prices are. What do you think they buy for? Is their mark up only 1.5? If it is, then what is the mark up between their cost and what they say Retail is?
    If they''re selling to the general public... are they Wholesale, Retail, what?
    If they''re wholesale, who do they buy from and at what cost? Then what is the mark up from THEIR suppliers cost to Retail? What if THEIR supplier decides to sell on the internet to move more merchandise... Do you think they''ll sell at Average retail and stay competative? Not a Chance! If they can sell at wholesale, undercut everyone and move more? What would you do?

    That''s why Appraisals are subjective. They are opinions based on experience and knowledge... but it''s based on a particular market and markets change from region to region.
     
  21. RockDoc
    Ideal_Rock

    Messages:
    2,509
    Joined:
    Aug 15, 2000
    by RockDoc » Sep 20, 2005
    Webgemman


    I will agree that different market levels, have different ranges of prices acheived. However, the appraisal report should define WHICH market level the research for the valuation is done in.

    The value conclusion needs to be made by someone who understands and is knowledgeable about the various market levels, and report the values that best suits the function and purpose of the report.

    Some of those considerations, particularly for acquiring insurance coverage need to be make knowing the type of insurance the client is going to purchase, and how the individual polcy''s method of settling a claim is. Without this information, and the value conclusions and the market level analyzed carefully, the appraisal COULD be totally useless for the consumer.

    The Rappaport sheet is NOT a WHOLESALE price that is acheived for every stone sold. Some stones are sold WHOLESALE ( for resale purposes only) for an amount in excess of what the Rap Sheet prices reports. But it is more commonly occuring that stones are sold for less than the Rap reported amounts.

    Regardless of the dollar amount "wholesale" is determined by the REASON the purchaser made the purchase. The compelling reason for a purchaser to to make a "wholesale transaction" is for RE-SALE. If for personal use, it is RETAIL, also regardless of the price.

    But appraisals used for determining the reasonableness of a price charged, need to specifically address the market level in which the item was purchased, although additional comparable acheived market(s) can be reports as well. Determining this is based on a lot of additional factors, the most obvious reason would be a difficult to replace stone in the market in which the purchase was made.

    A exceptionally strong case in performing comparable research of price is the price acheived for the item itself. Generally the price an item is sold for represents the strongest "case" for its value. There are exceptions to this, as there are transactions that are "extrodinary to the marketplace". But in reporting such an occurance, the valuation report needs to narratively explain WHY the person appraising the item made those conlcusions.Rockdoc

    In the case, of ebay "merchants" selling for just a few dollars over their cost, where the most commonly occuring acheived prices are greater in a different market level, the report needs to explain why and present supportable research details to have the higher value have legitimate credibility.

    Does this help you understand the "why''s" and the variances?

    Rockdoc
     
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