Why are APs dropping so much faster despite the sale restrictions?

[Djoker48]

Bunch of sources out there (watch charts) etc have APs falling much faster in secondary value compared to Patek and Rolex. I understand that Watches will never be investments (unless it’s a Tiffany Nautilus at retail :) but I would like some sort of value retention. Curious to know what it is about market dynamics that’s disproportionately affecting the brand?

Is it just not cool? Is it the Travis Scott Fiasco. Is it the Marvel collars? Or just something else

Technically, the sales restrictions should prevent supply inflating too much but it doesn’t seem to be working.

[psm11]

Originally Posted by Djoker48

Bunch of sources out there (watch charts) etc have APs falling much faster in secondary value compared to Patek and Rolex. I understand that Watches will never be investments (unless it’s a Tiffany Nautilus at retail :) but I would like some sort of value retention. Curious to know what it is about market dynamics that’s disproportionately affecting the brand?

Is it just not cool? Is it the Travis Scott Fiasco. Is it the Marvel collars? Or just something else

Technically, the sales restrictions should prevent supply inflating too much but it doesn’t seem to be working.

The obscene/aggressive prices hikes over the last few years is definitely a factor (e.g., continuously raising the price of ROOs despite being able to get them on secondary market for like $15k off MSRP).


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[~JJ]

Originally Posted by psm11

The obscene/aggressive prices hikes over the last few years is definitely a factor (e.g., continuously raising the price of ROOs despite being able to get them on secondary market for like $15k off MSRP).


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^This, plus let’s not forget you could buy a pre-owned basic RO for $12k from 2010 thru 2018 ish. Bubble has popped and going back to normal.

[SN2354]

I for one welcome a correction, but keep in mind that a watch like Rolex is much more popular to the masses than AP. So you have to assume people are flocking to Rolex before AP. Plus perhaps that really extra disposable income might not be there, so that always leads to price reductions.

AP can do as they please with their MSRP, I can only assume they will keep selling everything they make

[VogelPhoenix]

Originally Posted by Djoker48

Bunch of sources out there (watch charts) etc have APs falling much faster in secondary value compared to Patek and Rolex. I understand that Watches will never be investments (unless it’s a Tiffany Nautilus at retail :) but I would like some sort of value retention. Curious to know what it is about market dynamics that’s disproportionately affecting the brand?

Is it just not cool? Is it the Travis Scott Fiasco. Is it the Marvel collars? Or just something else

Technically, the sales restrictions should prevent supply inflating too much but it doesn’t seem to be working.

Ok, let's look at some numbers from the market indices at watchcharts.com:
Last 2yrs
Market: -25.8% PP: -31.1% Rolex: -19.4% AP: -31.3%
Last 6 months
Market: -3.3% PP: -3.5% Rolex: -2.6% AP: -4.2%

So, rather than Rolex and PP vs AP, it seems more like Rolex vs PP and AP. Why? Look at the 5yr numbers:
Rolex: +22% PP: +80.3% AP: +81.5%

So, using the info from that site, AP had the most insane run-up from 2018 on, closely followed by PP, with Rolex trailing far behind. Conversely, with the market returning to some form of sanity, AP and PP are on steeper decline from much higher highs than Rolex (but still maintain a much higher gain over 5 years).

No need to invoke false narratives around Travis Scott or Marvel.

I personally think that's a rubbish way to look at this hobby, but you brought up the charts.

[Djoker48]

Originally Posted by VogelPhoenix

Ok, let's look at some numbers from the market indices at watchcharts.com:
Last 2yrs
Market: -25.8% PP: -31.1% Rolex: -19.4% AP: -31.3%
Last 6 months
Market: -3.3% PP: -3.5% Rolex: -2.6% AP: -4.2%

So, rather than Rolex and PP vs AP, it seems more like Rolex vs PP and AP. Why? Look at the 5yr numbers:
Rolex: +22% PP: +80.3% AP: +81.5%

So, using the info from that site, AP had the most insane run-up from 2018 on, closely followed by PP, with Rolex trailing far behind. Conversely, with the market returning to some form of sanity, AP and PP are on steeper decline from much higher highs than Rolex (but still maintain a much higher gain over 5 years).

No need to invoke false narratives around Travis Scott or Marvel.

I personally think that's a rubbish way to look at this hobby, but you brought up the charts.

Thank you. That was an insightful reply. On another note, I wasn’t trying to imply any narratives, false or not. I listed a few factors that I saw floating around as areas of material dissatisfaction amongst AP loyalists here. They were merely that, factors not narratives. I am neutral to the brand.

[VogelPhoenix]

Originally Posted by Djoker48

Thank you. That was an insightful reply. On another note, I wasn’t trying to imply any narratives, false or not. I listed a few factors that I saw floating around as areas of material dissatisfaction amongst AP loyalists here. They were merely that, factors not narratives. I am neutral to the brand.

Ok, should have just called them "narratives", and indeed, they are popular in certain corners of the web

[GW44]

Originally Posted by VogelPhoenix

Ok, let's look at some numbers from the market indices at watchcharts.com:
Last 2yrs
Market: -25.8% PP: -31.1% Rolex: -19.4% AP: -31.3%
Last 6 months
Market: -3.3% PP: -3.5% Rolex: -2.6% AP: -4.2%

So, rather than Rolex and PP vs AP, it seems more like Rolex vs PP and AP. Why? Look at the 5yr numbers:
Rolex: +22% PP: +80.3% AP: +81.5%

So, using the info from that site, AP had the most insane run-up from 2018 on, closely followed by PP, with Rolex trailing far behind. Conversely, with the market returning to some form of sanity, AP and PP are on steeper decline from much higher highs than Rolex (but still maintain a much higher gain over 5 years).

No need to invoke false narratives around Travis Scott or Marvel.

I personally think that's a rubbish way to look at this hobby, but you brought up the charts.

Amen 🙏

Thanks for your valuable and succinct reply to the O/P

[ikincooper]

Originally Posted by GW44

Amen

Thanks for your valuable and succinct reply to the O/P

Agree 100% Gareth .


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[johnsonsxusfrt]

Originally Posted by VogelPhoenix

Ok, let's look at some numbers from the market indices at watchcharts.com:
Last 2yrs
Market: -25.8% PP: -31.1% Rolex: -19.4% AP: -31.3%
Last 6 months
Market: -3.3% PP: -3.5% Rolex: -2.6% AP: -4.2%

So, rather than Rolex and PP vs AP, it seems more like Rolex vs PP and AP. Why? Look at the 5yr numbers:
Rolex: +22% PP: +80.3% AP: +81.5%

So, using the info from that site, AP had the most insane run-up from 2018 on, closely followed by PP, with Rolex trailing far behind. Conversely, with the market returning to some form of sanity, AP and PP are on steeper decline from much higher highs than Rolex (but still maintain a much higher gain over 5 years).

No need to invoke false narratives around Travis Scott or Marvel.

I personally think that's a rubbish way to look at this hobby, but you brought up the charts.

Spot on... Me thinks OP is a troll

[NiJaRo1225]

Originally Posted by VogelPhoenix

Ok, let's look at some numbers from the market indices at watchcharts.com:
Last 2yrs
Market: -25.8% PP: -31.1% Rolex: -19.4% AP: -31.3%
Last 6 months
Market: -3.3% PP: -3.5% Rolex: -2.6% AP: -4.2%

So, rather than Rolex and PP vs AP, it seems more like Rolex vs PP and AP. Why? Look at the 5yr numbers:
Rolex: +22% PP: +80.3% AP: +81.5%

So, using the info from that site, AP had the most insane run-up from 2018 on, closely followed by PP, with Rolex trailing far behind. Conversely, with the market returning to some form of sanity, AP and PP are on steeper decline from much higher highs than Rolex (but still maintain a much higher gain over 5 years).

No need to invoke false narratives around Travis Scott or Marvel.

I personally think that's a rubbish way to look at this hobby, but you brought up the charts.

Great post!


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[Halothane]

Originally Posted by VogelPhoenix

Ok, let's look at some numbers from the market indices at watchcharts.com:
Last 2yrs
Market: -25.8% PP: -31.1% Rolex: -19.4% AP: -31.3%
Last 6 months
Market: -3.3% PP: -3.5% Rolex: -2.6% AP: -4.2%

So, rather than Rolex and PP vs AP, it seems more like Rolex vs PP and AP. Why? Look at the 5yr numbers:
Rolex: +22% PP: +80.3% AP: +81.5%

So, using the info from that site, AP had the most insane run-up from 2018 on, closely followed by PP, with Rolex trailing far behind. Conversely, with the market returning to some form of sanity, AP and PP are on steeper decline from much higher highs than Rolex (but still maintain a much higher gain over 5 years).

No need to invoke false narratives around Travis Scott or Marvel.

I personally think that's a rubbish way to look at this hobby, but you brought up the charts.

Interesting numbers I haven’t seen before. Helpful info for once on these price investment threads, lol. Thanks for the post !

I would be fun to dive deeper but from this limited data , I would deduce that Rolex probably has the lowest beta (if we want to compare to volatility / stock terms ). While Patek and AP have taken a bigger hit recently this is expected with a more volatile security. But also, they could have the biggest uptick if the economy could improve.

They grey market prices are definitely tempting right now. I’m trying to hold off buying grey until after the election as I think that will determine which way prices will trend.


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[mspeed76]

so yeah, there's more room to fall for AP as the hype fades and watches aren't purchased as investments or as "inflation hedges" lol

offshore MSRP seems especially over priced

beware of grey dealers doing their best to hide true prices and prop up the market

[Vince_76]

Watchcharts is bullshit.

Just look at MODA, watch dealer chats, etc. there is a very clear trend. And never forget the best barometer is actually approaching dealers and seeing what price they will buy a particular piece, and you can back into their margin. This tells you all you need to know - ask them what they’d buy a 15500 for.

Very unfortunate it has come to this with the investment and speculative culture. Sucks that we even have to have this conversation, but make no mistake the AP prices are sinking like a lead brick

[VogelPhoenix]

Originally Posted by Vince_76

Watchcharts is bullshit.

Just look at MODA, watch dealer chats, etc. there is a very clear trend. And never forget the best barometer is actually approaching dealers and seeing what price they will buy a particular piece, and you can back into their margin. This tells you all you need to know - ask them what they’d buy a 15500 for.

Very unfortunate it has come to this with the investment and speculative culture. Sucks that we even have to have this conversation, but make no mistake the AP prices are sinking like a lead brick

As are prices for the majority of the most hyped pieces from 2022. The once red-hot "John Mayer" green-dial Daytona goes for $65k on Moda, less than half of the 2022 asking price peak. 5990/1A peaked at 250k+ asking, now for sub-$100k on Moda. Blue dial Overseas are at or below MSRP.

I don't think anybody is denying that secondary prices have fallen significantly and may (likely) continue to do so. But if you want to revive OP's specific premise, you should come up with something more quantitative than "Just look...".

[Vince_76]

Originally Posted by VogelPhoenix

As are prices for the majority of the most hyped pieces from 2022. The once red-hot "John Mayer" green-dial Daytona goes for $65k on Moda, less than half of the 2022 asking price peak. 5990/1A peaked at 250k+ asking, now for sub-$100k on Moda. Blue dial Overseas are at or below MSRP.

I don't think anybody is denying that secondary prices have fallen significantly and may (likely) continue to do so. But if you want to revive OP's specific premise, you should come up with something more quantitative than "Just look...".

Could say the same thing about you. Blue dial ROs were touching 100k at peak and now can’t get 40k lol. Very similar story across the collection. But sounds like I don’t need to tell you. You’re free to do a price discovery exercise yourself.

[Djoker48]

The fact that most dealers are buying APs only on consignment vs Rolex and the Patek sports models (which they’re still buying outright) speaks for itself…

[Vince_76]

Originally Posted by Djoker48

The fact that most dealers are buying APs only on consignment vs Rolex and the Patek sports models (which they’re still buying outright) speaks for itself…

Thank you. This isn’t an intellectually difficult exercise whatsoever. Just apply some common sense as to what that means.

[SMD]

Originally Posted by Djoker48

The fact that most dealers are buying APs only on consignment vs Rolex and the Patek sports models (which they’re still buying outright) speaks for itself…

Yeah, it tells you that now interest rates are up no dealer wants to go out of pocket for any high priced piece. Why don't you shop a rainbow Daytona and see how many takers you get. It's about the cost of capital, and the speed at which inventory turns, and it is true for all brands.

[Vince_76]

Originally Posted by SMD

Yeah, it tells you that now interest rates are up no dealer wants to go out of pocket for any high priced piece. Why don't you shop a rainbow Daytona and see how many takers you get. It's about the cost of capital, and the speed at which inventory turns, and it is true for all brands.

Talk about a red herring. What’s a rainbow Daytona trade for?

Instead, compare a royal oak 3 hander to a comparable SS sports piece (aquanaut or nautilus). In fact, dealers are still buying those despite being higher priced.

[SMD]

Originally Posted by Vince_76

Talk about a red herring. What’s a rainbow Daytona trade for?

Instead, compare a royal oak 3 hander to a comparable SS sports piece (aquanaut or nautilus). In fact, dealers are still buying those despite being higher priced.

It's not a red herring. Jesus, I will draw you a map -- the point was that they dont want to tie up a ton of capital when rates are high and the speed at which inventory turns is slow. The rainbow Daytona was the most extreme example I could make. Anything above 30-40k is a lot for a dealer to tie up for an extended period of time. Working capital is expensive now. BTW, I offered my blue dial nautilus to several dealers and they were not interested. But hey you already know everything.

Anyway, who cares. AP is going to zero. Market is collapsing. It's only AP, PP and Rolex are awesome and totally not dropping at all.

Why everyone wants to fight is beyond me. It's tedious and boring. I regret coming back here every time.

[Vince_76]

Originally Posted by SMD

It's not a red herring. Jesus, I will draw you a map -- the point was that they dont want to tie up a ton of capital when rates are high and the speed at which inventory turns is slow. The rainbow Daytona was the most extreme example I could make. Anything above 30-40k is a lot for a dealer to tie up for an extended period of time. Working capital is expensive now. BTW, I offered my blue dial nautilus to several dealers and they were not interested. But hey you already know everything.

Anyway, who cares. AP is going to zero. Market is collapsing. It's only AP, PP and Rolex are awesome and totally not dropping at all.

Why everyone wants to fight is beyond me. It's tedious and boring. I regret coming back here every time.

Way to bow out lol. If you’re that fed up don’t come back.

No one said AP is going to zero. No one has said the market is collapsing. Stop drawing extremes.

Again, comparatively priced (15510st vs 5167a) for example. Ask a dealer and see what they say.

No reason to be so bitter bro you’re online talking to strangers lmao

[GW44]

Originally Posted by SMD

It's not a red herring. Jesus, I will draw you a map -- the point was that they dont want to tie up a ton of capital when rates are high and the speed at which inventory turns is slow. The rainbow Daytona was the most extreme example I could make. Anything above 30-40k is a lot for a dealer to tie up for an extended period of time. Working capital is expensive now. BTW, I offered my blue dial nautilus to several dealers and they were not interested. But hey you already know everything.

Anyway, who cares. AP is going to zero. Market is collapsing. It's only AP, PP and Rolex are awesome and totally not dropping at all.

Why everyone wants to fight is beyond me. It's tedious and boring. I regret coming back here every time.

Please don’t leave here.

The reality is that these market pricing threads invariably descend into chaos here……irrespective of the balance that members try to introduce.

But the fact this watch collecting passion has become another debatable asset class to be questioned ad nauseam is the real shame as it’s removed the whole point in my view. And it’s also why a number of valued members have stopped posting as TRF becomes a race to the bottom for those obsessing with market value vs. the whole point of buying/enjoying fine timepieces.

[Booth9999]

Originally Posted by SMD

It's not a red herring. Jesus, I will draw you a map -- the point was that they dont want to tie up a ton of capital when rates are high and the speed at which inventory turns is slow. The rainbow Daytona was the most extreme example I could make. Anything above 30-40k is a lot for a dealer to tie up for an extended period of time. Working capital is expensive now. BTW, I offered my blue dial nautilus to several dealers and they were not interested. But hey you already know everything.

Anyway, who cares. AP is going to zero. Market is collapsing. It's only AP, PP and Rolex are awesome and totally not dropping at all.

Why everyone wants to fight is beyond me. It's tedious and boring. I regret coming back here every time.

Well that escalated quickly. I think you are inferring a lot of that as it was not said directly.

[Djoker48]

Originally Posted by SMD

Yeah, it tells you that now interest rates are up no dealer wants to go out of pocket for any high priced piece. Why don't you shop a rainbow Daytona and see how many takers you get. It's about the cost of capital, and the speed at which inventory turns, and it is true for all brands.

The rainbow Daytona is not a like to like comparison. Let’s take 3 similarly priced pieces of each on the secondary: Say a Rolex Pepsi Meterorite, A Patek 5167a and a 15510 Blue. I’ve seen outright purchases of the former 2 but the AP on consignment. When asked why, the dealer mentions that the Rolex and Pateks have hit a price floor, thus allowing him to be safe even if he has to hold the inventory for longer. The AP could fall further. Combine that with the longer inventory turnover time, it becomes a difficult proposition to buy outright for a reasonable price (10-15% dealer margin). If so, the real question is why is AP being singled out?

The caveat is that this is anecdotal experience with a sample size of 3 dealers exhibiting similar behaviour. Perhaps others have seen differently and I would be open to hearing alternate perspectives.

It’s a shame since I’ve had a great experience at AP boutiques but I sense a discrepancy on the scarcity they’re artificially creating vs what the market is indicating vs both Patek and Rolex

[johnsonsxusfrt]

Originally Posted by Djoker48

Bunch of sources out there (watch charts) etc have APs falling much faster in secondary value compared to Patek and Rolex. I understand that Watches will never be investments (unless it’s a Tiffany Nautilus at retail :) but I would like some sort of value retention. Curious to know what it is about market dynamics that’s disproportionately affecting the brand?

Is it just not cool? Is it the Travis Scott Fiasco. Is it the Marvel collars? Or just something else

Technically, the sales restrictions should prevent supply inflating too much but it doesn’t seem to be working.

It's not just AP, all brands are crashing with the exception of select models. Nearly every Patek can be had well below retail except the 2 flagship models (and those have cratered from their aftermarket peaks), and the only rolexes holding above retail are pretty much a few GMTs, subs and steel daytonas. Even gold Daytonas are trading around retail.

[WatchTimes]

I do see more of the desirable models from Rolex being listed but not much change in prices yet.
Let me know when you see the AP 16202 dropping LOL.
The more common stuff may drop a little but I doubt you will see much movement in the really desirable pieces as people with $ will have $. It's the people who live on credit who are going to have a hard time going forward.

[conkers]

Well said Gareth. It is a buyer’s market again - collectors are rejoicing, “investors” are running for the hills. That suits me fine!

[GW44]

Originally Posted by conkers

Well said Gareth. It is a buyer’s market again - collectors are rejoicing, “investors” are running for the hills. That suits me fine!

Very true Roger

Hope you're well and please keep posting here too!

[conkers]

Originally Posted by GW44

Very true Roger

Hope you're well and please keep posting here too!

All well thanks my friend. I certainly will keep posting but only as and when I have the time in between hoovering up special pieces from distressed/over-levered sellers! That’s a full time job at the moment.