Most jewelry store owners offer appraisal services, and most are probably familiar with the occasional customer that requests these services after having their own bad appraisal experience with an unethical jeweler or hearing about someone else’s negative experience. These negative experiences can cause the customer to believe a bunch of myths about appraisals that fuel their doubts about the jeweler and make them hesitant to pay for an appraisal. Below is a look at these common myths, which every jeweler should be prepared to explain to customers who are skeptical about whether they will get an accurate appraisal.
Myth 1: – The value of jewelry consistently increases over time
Fact: The markets for diamonds, gemstones pearls and precious metals move independently of one another and sometimes decrease in value. The notion that jewelry pieces and diamonds will always increase overtime and are always a sound investment is particularly misleading, since jewelry valuations can fluctuate according to market conditions, exchange rates, metal prices and even fashion trends.
Myth 2: Diamonds are the most valuable part of a piece of jewelry
Fact: Contrary to popular belief, gold rather than diamonds is what determines the value of the jewelry piece. If a diamond is flawed, its valuation will be affected. Market conditions will also impact its value. Gold has a much more stable value.
Myth 3: Stone switching
Fact: Sadly, this is a problem; a customer will go into a jewelry store and ask the jeweler for an appraisal or to have a piece of jewelry repaired only to return a couple days later and get back the jewelry piece with a different stone. This happens with unethical jewelers, so the best way to prevent it is to make sure you find a qualified appraiser and jeweler with an excellent reputation and a long history of business in the jewelry industry. A good way to start your search for a qualified appraiser (not just anyone is qualified to give appraisals) is by checking with the American Gem Society, the Gemological Institute of America, or the National Association of Jewelry Appraisers. Unlike real estate appraisers who must be licensed, jewelry appraisers are not required to be licensed. Since these organizations teach appraisal theory and methodology, they are an excellent source for finding qualified appraisers. In fact, for your appraisal to actually be reliable, the appraiser you use should be certified by the Gemological Institute of America, a nonprofit organization that trains appraisers in the valuation of gems and jewelry.
Myth 4 –Having a degree in Gemology does not automatically qualify someone to do jewelry appraisals
While a gemologist is able to expertly identify gem material and grading, they do not necessarily know the principles and methods for calculating market valuation of jewelry and gemstones. To become an appraiser actually takes years of additional education. A qualified appraiser should be knowledgeable in both gemology and appraisal methods.
Myth 5 – Valuations never need updating
Jewelry collections should actually be updated approximately every five years in order to account for significant changes in the market as well as newly acquired or removed pieces if the appraisal is for a collection. Updated valuations are also a good way to catch any issues with the jewelry’s condition that might have been overlooked or introduced.
Myth 6 – Jewelry appraisals should be free
This is obviously a myth to an appraiser, but to jewelry customers, it might seem perfectly reasonable to expect the appraisal service to be free. Here’s what you need to tell the customer: Determining the value of a jewelry piece can take a long time, as it often requires research as well as different laboratory tests and examinations. There is also a grading process that takes time, the complexity of the piece to consider, market research and finally the writing of the appraisal itself. All of this is done by an expert who has years of experience as well as an education in jewelry appraising.
Myth 7 – The cost of the appraisal should be based on a percentage of the appraisal value
This is not only wrong, it’s not legal as calculating the appraisal costs this way would motivate the appraiser to inflate the value of the jewelry collection. Appraisers should charge an hourly rate only.
In spite of some of the misinformation circulating regarding jewelry appraisals, fine jewelry should always be appraised. If it is lost or stolen, the appraisal can help the owner of the jewelry receive the funds to replicate the lost piece or pieces. For this reason it’s important to have images of the jewelry piece too. CAD experts can easily recreate cherished pieces with just photos or sketches. Our “Lost Dolphin” story is a successful example of exactly this type of project.