Diamonds

How to Sell a Diamond

The should be called “Prawn Shops,” because they’ll dip you in cocktail sauce and eat you alive. On average, pawnbrokers will offer you only 10% of wholesale. STAY AWAY!

4 Tips for Selling Your Diamond Jewelry

The is a guest post by Barbara Diggs, a Paris-based freelance writer specializing in personal finance.

When Christine Clifford’s marriage ended two years ago, she found herself solely responsible for the payments and maintenance of her million-dollar home. For months she scrambled to keep up with the bills, but finally made the difficult decision to sell her jewelry – including two one-carat diamond rings, and a pair of diamonds earrings– to stave off foreclosure. “Today, I don’t have any ‘nice’ jewelry,” says Clifford, CEO of Divorcing Divas, LLC, “but I have the peace of mind that I kept my house afloat.”

Christine isn’t the only cash-strapped American setting aside “a diamond is forever” sentiment to sell their jewelry these days.  Josh Opperman, founder of the website “I Do… Now I Don’t” which specializes in the sale of “preloved” diamond jewelry, reports that 2011 was the site’s best year for diamond ring-listing and sales.

Now is a good time to sell.  Thanks to an escalating taste for diamonds among the middle class in China and India, diamond prices soared in 2011, increasing by 49% in the first half of the year before ending 19% up overall by the year’s end.  As a result, an increasing number of sticker-shocked jewelers are restocking with diamonds purchased from the public, rather than buying from wholesalers.

“You’re seeing a lot more signs in [jewelry store] windows saying ‘We buy gold and diamonds,’ not just ‘We buy gold,’” says Rob Bates, senior editor of the Jeweler’s Circular Keystone magazine, a leading trade publication in the jewelry industry. “I even spoke to one jeweler who is only buying diamonds off the street these days.”

While the timing may be right, selling your diamond can be a major headache. Unlike gold, which has a quantifiable melt value, resale prices for diamonds have no one objective measure, making it easy for inexperienced sellers to become confused and overwhelmed.

To help unravel the mysteries of diamond selling, here are four tips to consider before hocking your stone.

1. Know what you’ve got

Just because Granny said her old diamond ring was valuable doesn’t make it so.  It doesn’t even make it a diamond. So, before you rush to market, get an accurate picture of its quality and authenticity. A qualified appraiser – preferably one that doesn’t buy or sell diamonds – can give you an unbiased opinion of the stone’s characteristics and condition, and highlight positive and negative attributes that could affect its value.

But spending money on a formal assessment isn’t always necessary, says gemologist Neil Beaty, owner of American Gem Registry, an appraisal service in Denver.  If you’re short on funds and the diamond is likely worth less than $2,000, have the stone evaluated for free by a professional diamond buyer or even a pawnbroker. Visit two or three shops to get a range of opinions; in the end, you’ll have a solid idea of the specifications and state of your stone.

2. Set a realistic price

Having unrealistic price expectations for your diamond is the fastest way to disappointment with any ultimate sale.  Beaty recommends two approaches to determining a shrewd price.  First, if having an appraisal, ask how much the stone might be worth in specific markets and circumstances. “Discussing pricing strategies is about 80% of the benefit of an appraisal for resale customers,” he says.  A good appraiser follows current market trends and can help you understand the potential resale value of your diamond.

Now is a good time to sell.  Thanks to an escalating taste for diamonds among the middle class in China and India, diamond prices soared in 2011, increasing by 49% in the first half of the year before ending 19% up overall by the year’s end.  As a result, an increasing number of sticker-shocked jewelers are restocking with diamonds purchased from the public, rather than buying from wholesalers.

“You’re seeing a lot more signs in [jewelry store] windows saying ‘We buy gold and diamonds,’ not just ‘We buy gold,’” says Rob Bates, senior editor of the Jeweler’s Circular Keystone magazine, a leading trade publication in the jewelry industry. “I even spoke to one jeweler who is only buying diamonds off the street these days.”

While the timing may be right, selling your diamond can be a major headache. Unlike gold, which has a quantifiable melt value, resale prices for diamonds have no one objective measure, making it easy for inexperienced sellers to become confused and overwhelmed.

To help unravel the mysteries of diamond selling, here are four tips to consider before hocking your stone.