Does Jewelry Depreciate? Everything You Need to Know

Written by: Benjamin Khordipour, Jewelry and Gemology Expert
December 27, 2021 – Posted in: Jewelry Blog

While many items appreciate or depreciate over time, different rules apply to jewelry. Jewelry’s long-term value mainly depends on its type and age. High-end, rare jewelry can have greater value in the future, while artificial jewelry is all but guaranteed to lose its value. However, many other factors need to be considered first. 

In this article, we’ll cover whether jewelry decreases in value over time. We’ll also give you some tips on which jewelry you should and shouldn’t invest in. 

Does Jewelry Depreciate Over Time? 

Customer looking at diamond halo engagement ring in showroom

For the most part, yes, the majority of the jewelry out there will depreciate over time. Jewelry has been seen as a luxury commodity since antiquity. What’s more, jewelry is often viewed as a type of currency, given that the line between jewelry and money is sometimes blurry. Not only is jewelry occasionally used as currency, but it’s a common type of heirloom as well.

But how and why does jewelry depreciate over time? 

In most cases, the value of jewelry is measured by its quality, rarity, and age. For example, high-quality jewelry does lose its value as time goes by, but at a slower rate than artificial or cheaper jewelry. On the other hand, low-priced imitations and fake gemstones aren’t very valuable, to begin with. Their price can drop dramatically the moment you walk out of the store.

Important Note: Antique jewelry, rare jewelry, and historic or unique jewelry will not only hold the same value but will even appreciate rapidly over time. Read our guide on how to invest in jewelry.

Unlike cars and electrical equipment, which become less valuable when used, jewelry doesn’t have to drop in value when you wear it. Antique or vintage jewelry won’t drop in price even if though they are pre-worn. That’s because no one minds sharing jewelry and also because their historical/rarity value is more important than anything else.

How to Know if Your Jewelry Is Valuable 

Using a loupe over a peridot halo ring

Verifying your jewelry’s value is especially important in cases of divorce, family division, or inheritance. Your jewelry could be worth thousands of dollars, but it could also be sold for as little as $50. There are different ways of checking whether your jewelry is valuable or not. 

If you’ve been wearing a particular piece of jewelry for years, but it didn’t get chipped, scratched, or discolored, it’s a sign that it’s a high-quality piece. That’s because genuine jewelry rarely becomes tarnished over time. 

There are simple ways to check if your jewelry is authentic, but the best way to check if your jewelry is valuable is to have it professionally appraised.

Experts will be able to assess the monetary value of your jewelry if you can’t remember how much you originally paid for it. However, you may find that you were ripped off and that you overpaid for the jewelry’s actual value. An official jewelry valuation report will provide you with the necessary information that will determine its worth. For instance, the item will be accurately described, including its quality and composition.

With this document, you’ll be able to sell your jewelry for a much higher price than without it.

Is Jewelry a Good Investment? 

Afshin and Adira with Necklace in Showroom

As mentioned before, the jewelry’s quality and rarity dictate whether or not it’s a good investment.

If its value continues to grow over time, it becomes an excellent asset. Many jewelry investors will prefer to invest in jewelry simply because it’s less risky once you know what you’re doing. Jewelry is a good investment because its worth is more reliable even in fluctuating stock market periods. 

It is important to note that during market recessions and inflation, the value of your jewelry might decrease as well, so its price tag isn’t set in stone. However, this doesn’t occur too often, and it’s never a significant shift in value when it does. What you should know is that if you want to sell a piece of rare jewelry that you bought long ago, its price is likely to be twice or three times less than the original wholesale price. Aside from market disruptions, another factor that can influence jewelry value is its demand.

Keep in mind that these rules only apply to fine jewelry of the highest quality. You should stay far away from low-quality and commercial jewelry if you’re looking to invest.

What Type of Jewelry You Should and Shouldn’t Invest In 

Sapphire Floral Ring with Loupe
Kashmir Sapphires are one of the hottest investments on the market right now

Before you decide to invest in jewelry, it’s crucial to do your research or talk to an expert

Fine jewelry is usually made from quality metals like platinum or gold. They also feature precious gemstones, like gem-quality diamonds, sapphires, emeralds, rubies, and more. The design doesn’t have to influence its value at all; fine jewelry can be ornate or minimalist. 

If you’re wondering which specific type of jewelry to invest in, rare vintage jewelry is known to be one of the hottest commodities. For example, you can’t go wrong with high-quality jewelry from the Victorian, Edwardian, and Art Deco eras. Especially, if the center contains a rare gem-quality stone.

Diamonds, for the most part, are the most expensive gemstones (the cost of a 1-carat diamond being between $1,300 and $16,500), but only the very high-end ones will appreciate with age. In fact, the moment you buy a low-grade diamond, a large portion of its value (20% to 30%) disappears. Lab-grown diamonds (which we strongly discourage ever buying) lose their resale value by 80% the moment you buy them.

For some context, a laptop or phone will lose approximately 60% of its value as soon as you turn it on.

Jewelry that diminishes in value over time is often called costume jewelry or fashion jewelry. This type of jewelry is typically more affordable and made from cheaper materials like brass, copper, and bronze. It can even be made of plastic or wood. However, costume jewelry can sometimes look more expensive than high-end brands that sell for thousands of dollars. That’s why you need to be careful about checking the item’s authenticity before you buy it. 

Tips to Buy Jewelry That Won’t Depreciate Over Time 

If you want to invest in jewelry that’s not likely to depreciate in the future, here are some factors you’ll want to consider: 

Insurance Appraisal 

Signing contract for jewelry insurance

When you buy a high-quality piece of jewelry, like a diamond engagement ring, you need to have an insurance appraisal. That will enable your insurance company to pay for any issues that might occur at the correct value. Moreover, your insurance appraisal will use the retail replacement value of your ring. In other words, you’ll receive the highest monetary amount required to replace it. 

Buy From Reputable Jewelry Brands 

Afshin and Adira with Vintage Earring in Estate Diamond Jewelry Box

You should always shop with a trusted and reputable jewelry store. Where you buy your jewelry can significantly affect its depreciation rate. If you purchase the item in a pawn shop or an auction, it will have a greater chance of depreciating over time. That’s because your insurance company is more likely to accept a reputable jewelry dealer’s selling price than the alternative, lower price. 

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Check the Hallmark 

Gold Hallmark on Italian Necklace

The reason you need to check whether your jewelry has a hallmark is that it certifies the purity of gold, silver, platinum, or palladium. It’s incredibly easy to create artificial precious metals and just as challenging to tell them apart. That is why the hallmark policy was created. It can even reveal the country of origin of the jewelry in addition to the metal content of the piece. 

Determine the Quality 

Customer using a Loupe on a Diamond Engagement Ring in Showroom

There are many things you can do to educate yourself on your investment. Assessing the item’s quality is one of them. 

For example, with diamonds, it’s all about “the four Cs” (cut, clarity, carat, and color). It’s best to search for diamonds that belong to GIA’s D-E color category (which is the colorless group) and that have a VVS1 and VVS2 clarity. If you find diamonds with FL and IF “internally flawless” clarity, you’re incredibly lucky since such diamonds are extremely rare. 

Choose Vintage Over Contemporary 

vintage jewelry in estate diamond jewelry showroom
Some of the Estate Diamond Jewelry Vintage Collection

Although it might be tempting to buy a piece of your favorite designer’s newest collection, vintage jewelry is much more valuable. Generally, the older it is, the more value it has. Jewelry is considered antique when it’s at least 100 years old. More specifically, jewelry from the Edwardian, Victorian, and Art Deco eras will have a much higher value than recent items. If the piece is one-of-a-kind, it will be even more valuable. 

If you have vintage jewelry, you can sell it at an auction, where you’re likely to make more money from it. 

The True Value of Jewelry 

Fine jewelry does not usually depreciate. In fact, it can even increase in value in the future. Artificial, low-quality costume jewelry will lose value at a much quicker rate. The most valuable type of jewelry is rare and old jewelry that hasn’t been damaged in any way. If you’re looking to invest in jewelry, gold, diamonds, silver, and other precious gemstones are the best options. 

Talk to a Jewelry Expert

Shopping for a diamond engagement ring from Estate Diamond Jewelry

Do you have any questions about jewelry investing and jewelry depreciation? Feel free to reach out to one of our jewelry experts. They will respond promptly.