As any collector can tell you, luxury watches are much more than a means of telling time. They’re works of high craftsmanship, symbols of taste and status, and, for many, investments that can hold their value and even appreciate over time—as it turns out, even more so than the stock market.

Since the beginning of the pandemic, the secondary market for select luxury watchmakers has seen tremendous growth in demand and valuations. In 2021, preowned watch sales reached $22 billion, accounting for nearly one-third of the overall $75 billion luxury watch market, according to BCG.com’s recent report, “Luxury Preowned Watches, Your Time Has Come.” Based on auction results from the first half of 2023, interest in and the market for pre-owned luxury watches continues to be strong. Take a look on page 24 in this month’s issue at some of the more head-turning auction results so far from this year.

While sky-high auction prices for brands such as Rolex and Patek Philippe are of interest to collectors and horologists, the market for pre-owned luxury watches has also opened the door for other luxury watch brands, most notably Cartier, Jaeger-LeCoultre, Omega, TAG Heuer, and Vacheron Constantin, to enter their timepieces into this hot, in-demand luxury resale market. It is even leading to collector interest in and valuations for such independents as F.P. Journe and De Bethune.

Watchmaker F.P. Journe is a relative newcomer to the luxury watch market (est. 1999) but caught collectors’ interest in 2021 when an F.P. Journe watch passed the $2 million mark at auction for the first time. In a business that prides itself on craftsmanship, F.P. Journe makes 95 percent of its own components. This devotion to the craft, coupled with the fact that it creates fewer than 1,000 watches each year, has made the brand highly sought after among high-end collectors and on the secondary market. According to the Financial Times, the saleroom price of certain models by the independent Swiss watchmaker had risen eight-fold in just four years.

While avant-garde watchmaker De Bethune is well-known among watch aficionados for crafting both impossibly modern and technically advanced timepieces, the brand received a huge bump in attention last year when Michael Jordan scored the first in a very limited series of John Player Special-themed watches from de Bethune called the DB27 Titan Hawk JPS. Jordan is an investor in WatchBox, a pre-owned watch retailer that acquired De Bethune a year ago, something that no doubt gave him an edge in snagging one of the 25 pieces.

Limited releases, a long-time marketing tactic employed across all collectible categories to boost demand, collectability, and value, have become even more intentional and commercial these days among watchmakers, as well. Audemars Piguet recently announced a collaboration with Marvel, yielding its first release of a limited-edition “Black Panther” Royal Oak Concept. Only 250 were produced and one commanded an impressive $481,700 at Christie’s last fall after the first, made in white gold, sold for $5.2 million in a special auction.

So, why are collectors opting for the pre-owned? According to industry insiders, there are five factors driving the second-hand market:

Limited quantities and speculations of discontinuation. The secondhand market is essential for collectors who seek rare and special watches, given that nearly 95% of watches are no longer in production. Luxury watchmakers only release a limited number of models each year. If a certain model is speculated to be discontinued, in many instances its price will skyrocket on the secondary market (e.g. private sale and auction). Once a brand announces its yearly offerings and a beloved model remains in production, its price will generally normalize.
Buyers are impatient. As the market of watch buyers grew and watch manufacturers faced supply and production issues during the height of the pandemic, demand for luxury timepieces far outstripped supply. This resulted in longer lead times and waitlists. Eager collectors have turned to the secondary market, giving it a tremendous bump over the last three years. In some instances, coveted or recently retired models have sold for more than triple the retail price.
The Internet keeps a pulse on the market. Today, collectors have the advantage of watching the secondary market and trends on platforms such as Chrono24, WatchBox, Watchfinder, and Hodinkee, they can also see auction house results, like Christie’s, in real time online.
Investors looking for alternative investments. Wealthy investors are increasingly looking to diversify their portfolios and to hedge against inflation. For these and other investors, luxury watches stand out as a class of alternative assets because of the strong demand for them and because they have generally delivered strong price performance in the market over the past five to ten years.
Star Power. Athletes and celebrities are raising the profile of luxury pre-owned and new watches and the hot brands to look for, becoming the new collectors and influencers in the market. Examples include Roger Federer and his Rolex Daytona ‘Orange’ in yellow gold (retail value: $86,750); James Harden and his Patek Philippe Nautilus Tiffany 5711/1a (values at $6.5 million at auction); and Christiano Ronaldo and his Girard Perregaux Planetarium Tri-Axial 99290B52P951-BA6A (market value: $1.7 million).

While industry analysts project values will stabilize as supply-chain issues subside with COVID, an investment in a pre-owned luxury timepiece is expected to still be a sound investment, performing well, especially over the long term, in comparison with traditional investment categories. According to the BCG report, in the 10-year period from 2013 to 2022, watches outperformed collectible assets such as jewelry, handbags, wine, art, and furniture.

Now may be the time to give vintage and pre-owned luxury timepieces a second look, not only to amp up your style but as an investment for your future. Only time will tell.