Investments in Rolex Watches Beats Houses, Gold, Dow Jones Average

November 03, 2024

Prices for luxury watches like Rolex, Patek Philippe, and Audemars Piguet skyrocketed in 2022.
Demand for second-hand luxury watches will likely stay high next year, according to Chrono24 founder Tim Stracke.
Watches continue to be an attractive asset class for investors.

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In March, the price of a second-hand Rolex Daytona watch peaked at a whopping $48,500. It's come a little closer to Earth since, and is now around $30,000 on the secondary market, according to WatchCharts.

Prices of Rolex watches on the secondary market skyrocketed during the first several months of 2022, before dipping a bit as the year ended. But the Rolex's value as an investment has outperformed other assets like gold and the stock market for the past decade, according to analysis by Bob's Watches.

On Chrono24, a popular luxury watch marketplace that claims investors like French billionaire Bernard Arnault — who just toppled Elon Musk as the richest man in the world this year — approximately 25% of site searches are Rolex-related.

Around 14% of the platform's sales come from Rolex watches, and 80% of those are pre-owned.

"We're still seeing, for most of the watches, prices above January this year," said Tim Stracke, the founder of Chrono24, "but not as crazy as they were in March and April."

According to Chrono24's data, the dramatic increase in prices has mainly affected what Stracke calls the "glorious three" brands: Rolex, Patek Philippe, and Audemars Piguet.

Other watch brands, however, have only seen what Stracke calls a "very, very stable, slow but steady increase over time."

The long-term investment potential of a Rolex

Back in February, Paul Altieri, the CEO of online watch resale marketplace Bob's Watches, told Insider, "Rolexes have been a good investment over the years, but not like the last five."

For the past decade, Bob's has been buying and selling thousands of watches using a consistent pricing strategy that has given the company unique insights into the real market value of every Rolex model.

One of the reasons for Rolex's swift rise in prices amidst recent years comes down to supply. Rolex reportedly makes about 800,000 watches each year, but the popularity of the brand means demand vastly exceeds the supply of new timepieces, leading to a robust secondary market for pre-owned watches.

Indeed, the sales numbers for Rolex on average shows an uptick beginning in 2017, followed by an even sharper bump up in 2020. As of February 2022, the average Rolex price is more than $13,000 — nearly three times the 2011 average of $5,000.

"Before you leave the store it's worth double or triple what you paid," Altieri said.

And that's if you can even find an authorized dealer to sell it to you.

"People have waited a year or two for their name to come up on the buyers list — they're not going to flip it," Altieri said.

The limited supply is likely one the reasons that Rolex launched its own certified pre-owned program in December.

"The new programme makes it possible to purchase pre-owned watches that the brand itself has certified and guaranteed. Its aim is to bring added value to the existing supply of pre-owned Rolex watches. Because when these watches change hands, their authenticity must be attestable at the time of resale by the Official Retailers," Rolex noted in the press release announcing the program.

The current total value of the pre-owned luxury watch market is estimated to be worth $20 billion, according to a report from McKinsey, and is expected to top $29 billion by 2025.

Stracke expects that inflation will continue to drive up demand and prices for the glorious three in the coming year.

"A lot of users buy a watch to not only enjoy the perfect craftsmanship, and the beauty of the watch, and the status of the brand, but also the stability of value," he said. "We have to call it not only a piece of jewelry, and a luxury category, but also the real asset class.

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