5 things you should know before trying to sell old jewellery
There are a lot of ‘we turn your gold into cash’ places out there, and often we are led to believe that we are sitting on a virtual gold mine. Perhaps you have some pieces that you think are worth more than their scrap value. Before you decide to liquidate your assets, consider these tips.
Talk to an expert – Get your valuables appraised by a third party. You might want to consider having a certified appraiser who is not interested in buying your jewellery give you detailed information about your piece, including a valuation. Many who inherit the ‘family jewels’ know only vague information about the pieces. An expert will be able to inform you about your jewellery before you make the decision to sell. An appraisal will cost you money, but it’s better to be informed.
Insurance replacement value vs. fair market value – there are two types of appraisals, insurance replacement value appraisal and a fair market value appraisal. When you are getting your jewellery evaluated, be sure you are getting the right kind for what you intend to do with your jewellery. If you are going to keep your jewellery, get an insurance replacement appraisal, if you are going to sell, get a fair market value appraisal. An insurance replacement appraisal is for providing to your insurance company in case of loss or damage to the jewellery. This is the amount that would be required (often corrected for inflation) if you had to replace the piece that is lost or stolen by purchasing or remaking the jewellery. A fair market value appraisal is the kind of appraisal you get if you are looking to sell your jewellery. This valuation will tell you what you should expect to get (retail) for it on the open market.
Will someone buy it for resale? - Selling your jewellery is a lot like selling other things, its value is often determined by how desirable the piece is, and how many people want to buy it. You may think your piece is the greatest thing that has ever been made, but if no one else does, then it may be difficult to get the value you want for it. Take a look at how much similar items are being sold for.
They’re not paying for craftsmanship, only for materials. – One thing to keep in mind when someone is buying old jewellery is that you are paying for the value of the materials that are there, not for the craftsmanship of the piece. A piece that looks intricate and well made may have been expensive since it took a long time and a lot of work to make. However, if there is only a small amount of metal and small or no gems, then it may not be worth as much to the new buyer.
Here’s how things work – When a person is in the business of buying jewellery (to resell), they would like to buy the piece at 25% of the fair market value, so they can then mark it up 100% for resale (to 50% of the fair market value). That way, they can offer products that are below market value (they’re a good deal), and also make a living at what they do, and cover their overhead costs. If you are selling to a buyer who resells, the absolute most you can hope to get for the piece is 50% of the fair market value, which is lower than the insurance replacement value. If you want to get more for your piece, consider selling privately (Kijiji, etc.), but have your wits about you and be smart. Don’t get yourself in a dangerous situation by advertising that you have a lot of valuable things. Keep in mind, even in private sales, your buyer will likely want to get a ‘deal’. Simply because you can present a value with an appraisal, it doesn’t mean that your buyer will be willing to pay that amount for it.
There are some other options. Auction houses will sell jewellery for you on your behalf. Check to see what the ‘hammer price’ is (the commission the auction house will take for selling your piece on your behalf), and consider putting a reserve bid if there is a minimum you wish to get for your jewellery. If you love the piece, but it just doesn’t fit with your lifestyle, consider passing it down to someone else within the family. There may be someone close to you who loves it, and would wear it. If the materials are good, but it’s just not a design you would wear, perhaps making it into something else would be appropriate. Consult a jeweler who specializes in custom design and restyling of old jewellery to discuss your options. The final option is melting it down – the cash for gold option. Most likely your jewellery will simply be put on a scale and weighed. You would then be paid a percentage of market price of gold per gram. Any stones in the jewellery would be removed and returned to you. You would not get any money for the gems.
Get informed, do some thinking and make a choice that feels right for you. If you can’t decide what to do, put the piece away for a while. The good news about jewellery is that it never goes bad. You can always decide it’s fate another day. At the end of the day, if you don’t want to keep it, accept the value that your piece has and use the money for something you do want.