The meltdown in cryptocurrency prices and the resulting depletion of perceived wealth have taken a toll on the sellers of some old-tech luxury items — particularly used watches from Rolex and Patek Phillipe, Bloomberg reported Friday (July 1).
According to Bloomberg, the average price of secondhand luxury timepieces surged amid the rise in stock and crypto prices and stimulus checks from the federal government. Used luxury watches even became safe-havens for some investors unnerved by volatile markets earlier this year.
Some 25% to 30% of demand for luxury items was driven by the increases in cryptocurrencies, analysts at Jefferies said, per the report. Those prices now are falling, even as prices for new luxury watches seem to be holding up.
Bloomberg said that the “holy trinity” of watches — the Rolex Daytona, the Patek Philippe Nautilus and the Audemars Piguet Royal Oak — were “trading for many multiples of their retail prices.” The broader secondhand luxury market has held strong, although it is susceptible to some of the same market forces watches have faced.
Beyond the crypto market, stimulus checks have come to an end, inflation is surging and buyers in China are enduring lockdowns again. Prices for the most-desirable used watches are around 25% below their peaks, while waiting lists for certain models of new watches can exceed two years.
At the same time, the report noted that sellers of watches including Cartier, Omega and Tudor are seeing supply exceeding demand for some models.
In another luxury sector, RH, formerly Restoration Hardware, recently reported that it expects weakening demand through the end of the year.
See also: RH Says High Mortgage Rates Killing Demand for Luxury Homes, Furniture
RH, which provides home furnishings, said its full-year sales declined by 2% to 5%. Just a few weeks earlier, RH posted record quarterly results that showed its sales had risen 11% from a year ago — and almost 100% over the past two years — for the three month period through the end of April.