Are Engagement Ring Natural Diamonds a good investment? The short answer is “No”! Does this hurt to hear? Absolutely! Does your girlfriend still want a Diamond? Absolutely, again! Let’s dive into why they’re not good investments, what the resale market looks like, and what you should do when it’s time to create your special someone’s Dream Ring.
Why are Engagement Ring Natural Diamonds a bad investment?
Supply and demand, my friends. On the supply side, I’m sure you know this by now: there’s no shortage of Natural Diamonds to be mined. This comes fully-disclosed from a reputable jeweler, who won’t try to sell you on any typical Natural Diamond as an “investment”. There’s a steady supply of most common size and weight Natural Diamonds, so if you decide to sell yours in a couple years, no jeweler’s willing to give you more than what you paid for it.
On the demand side, Natural Diamonds have taken a big hit in recent years, because of (you guessed it) Lab-Grown Diamonds. Natural Diamond prices have come down significantly since 2020- this year cutting and polishing of new stones is on pause til Christmas. When demand goes down, prices follow. If you bought a common quality Natural Diamond five years back, it’s worth significantly less now.
How do I make money on a Natural Diamond I bought?
Excellent question! I’m sure you thought of this, I just wrote it down for you. The best way- really the only way- to turn Natural Diamonds into good investments is to sell them to a retail consumer. AKA another person looking to get engaged. Why? Because they’re willing to pay retail prices, as they’re not planning on reselling the Diamond immediately after.
Now, there is a bit of a stigma with buying pre-owned Diamonds. Some superstitious people think it’s bad luck to buy a Diamond from a divorce. Then you guys got smart and starting calling them “pre-loved” Diamonds. Excellent marketing tactic. List your pre-loved Ring on a peer-to-peer website (eBay, Facebook Marketplace, etc.) and do so at a 15-25% discount off what your local retail jewelers are charging. This is a good enough incentive for people to reach out, so be ready to send pictures and videos of the Ring, and make sure you have an appraisal, the GIA/IGI Grading Report for the Center Diamond, and your original receipt (in case you need to negotiate).
So, should I not buy a Natural Diamond?
Not to be biased, but I don’t get why people attack Natural Diamonds- out of all luxury items- for not appreciating. If you buy a top-of-the-line Mercedes-Benz, it loses 25% the moment you drive it off the lot. Most designer clothes is the same. The factories producing those goods keep producing, so your piece isn’t going to be worth more just because time has passed.
Diamonds are no different. To give you a real life example, we had a client buy this Diamond in 2013. Unfortunately, he got divorced, and came back to us for help reselling it in 2021. He paid $25,000 for it originally and do you know the highest bid he got from a professional diamond buyer in 2021? $13,000!!! Why’d he sell it to a diamond buyer? Because he bought way too high quality of a stone this size and couldn’t find any retail customers to buy it from him. That’s why we stress optimizing for Color and Clarity. If you’re worried about investment, don’t buy a Diamond no one wants to buy from you.
So, if you want to buy a Natural Diamond, go right ahead. But proceed fully-armed with this info.
So, Natural or Lab-Grown Diamond for my Ring?
In my humble opinion, Lab-Grown Diamonds are the way to go, from an investment perspective. Reason being, you’re going to lose money (on paper at least) on both, unless sold to a retail client shopping for their own Ring. Would you prefer to lose money on a $3k investment (average Lab Diamond Ring price) or a $6k investment (average Natural Diamond Ring price)? The decision is totally up to you, but you deserve to go into this decision fully-informed. And, of course, you should shop from a Diamond wholesaler and Engagement Ring manufacturer (like us). You’ll have that nasty retail markup on your Center Diamond, as well as a nice 50-100% on the Setting, which we make in-house.
Javi Perez,
President
I’m here to help you create the PERFECT Engagement Ring for thousands off retail price. Keep saving for a lifetime with your soulmate while creating a Ring she’ll adore forever.
- Call me at 888-596-6380 (I’m extension 2)
- Hit the DMs @gabrieledwardjewelers
- Email me at javi@gabrieledwardjewelers.com
Why Gabriel Edward Jewelers for the Ring?
