Diamonds are currently a journalist’s best friend, as the press has recently been filled with stories of astounding stones selling for millions of dollars.
Like the Rio Tinto pink diamonds that sold recently with at least two of the rocks going for more than $2 million. Or the egg-sized white diamond that recently sold for £19 million in a Hong Kong auction.
This got me thinking about selling jewellery here in the UK. Adverts invite us to flog our gold and silver and several recent TV documentaries have shown hard-up Brits flogging their precious metals at pawn shops.
But if you have a genuinely valuable piece of jewellery, or just want to clear out your jewellery box of old items and raise some cash, how can you be sure you’re getting the best price and not just its melt-down value? We’ve been asking the experts how to sell your bling without being ripped off…
Develop your own understanding
Of course, the more information you have about your stone or piece of jewellery, the stronger your position.
Vashi Dominguez, diamond expert and CEO of the jewellery company Vashi suggests would-be sellers educate themselves online about the value of their stones.
“Get to know how to self-value your jewellery; it will help you not to get ripped off! There is a wealth of background information available online. With diamond jewellery, identify the all-important 4Cs - carat, colour, clarity, cut – of your diamond,” he explained.
“Armed with this information, take your jewellery to an independent appraiser to validate these price estimates.”
He also recommends buying a jewellers’ loupe, which is a 10x magnification lens.
Dominguez explains: “It’s a very small investment, but a jewellers’ loupe will help you check that the estimates obtained about the cut of the diamond or precious stone, its possible imperfections, the colour, [and so on], are a good match, which will allow you to obtain a fair price in the market.”
Finding the true value
Of course, even armed with a jewellers’ loupe, you may still struggle to value your gem yourself. There’s a reason that Dominguez’s diamond expertise is in demand.
So how can you find a reliable price? One option is to approach several different auction houses or other buyers to ask what price they would offer. However, there’s no guarantee that they wouldn’t all attempt to pay less than the real value; after all, they want to maximise their profit.
You might have more confidence visiting a member of the Association of Independent Jewellery Valuers. To gain membership, jewellers have to sign up to a code of ethics which include observing the “highest standards of honesty, fairness and integrity in all business relations with members of the public”.
There will be fees to pay, so this isn’t necessarily the best way to price up lower-value items. But if you’ve inherited something and have no idea how much you should sell it for, this could be an investment that really pays.
It’s also a good way to value items so you can insure them properly.
Another way to assess the true value of your jewels is to compare their prices to similar pieces on sale. You can do this by browsing similar items online and in shops, or you could use an online valuation tool such as Comparejewellery.com.
This website has reviews and ratings for more than 6,000 pieces of jewellery, allowing you to assess the value of a piece. It’s primarily used for shoppers trying to find a fair price for an item, but it could also be useful if you want to find out how much your jewellery could be worth on the open market.
Of course, if you sell it to a retailer you’re unlikely to get the top price as they will need to make some profit. However, being armed with this sort of information can help you push up your price and get a fairer deal.
More than the melt-down value
Quite often, jewellery is sold according to the value of the stones and the metals. But that’s not necessarily a fair price – after all, quite a lot of skilled work has gone into setting the stones artistically.
Ian Wilson is the founder of Lulu’s Estate Jewellery, a company that specialises in buying, selling and renting find jewellery without charging vast mark-ups and fees.
He explains that values can vary wildly, depending on how the value is being assessed. Take as an example a pair of 18 carat white gold hoop earrings, with 2.2 carats of HIS diamonds.
These could easily sell for £3,500 including VAT. However, if you sold them to many jewellers or specialist gold buyers, they might only offer you the value of the stones and gold.
“I can tell you that diamonds of this size out of the earrings trade at £100 a carat. So that would be a wholesale price of £220 – if the wholesaler gave you a fair price. The gold weight wouldn’t be much more than £200, which is probably generous. So the total price at the average jeweller is £440 – less the profit margin of 20%. About £360 if you’re fortunate,” he explained.
There’s a pretty wide gulf between £3,500 and £360. So what are your other options?
Auction houses and specialist sellers
Unlike a wholesaler, auction houses have a vested interest in your receiving the highest possible value for your item. However, they aren’t always suitable for a seller, with the larger auction houses often focusing their efforts on selling pieces worth more than £50,000.
However, there are options for small-scale sellers. For example, Lulu’s Estate Jewellery’s business model is to attract sellers with fair prices while still offering the items for sale at lower prices than competitors.
In the hoop earrings example above, Wilson explains that his company would buy such an item for far more than £360 and sell them on for around £1,300-£1,400.
“There’s a significant mark-up and therefore it’s possible to operate within that mark-up and be generous to both parties.”
Have you sold jewellery? Did you get a fair price? Share your experiences and opinions with other readers using the comments below.