Diamond Prices and Appraisals

Wholesalers and for that matter, diamond retailers, buy their diamonds on a per carat basis and if you are going to buy from anyone in the business, you should consider the stone in that same light.

It is practically impossible to quote diamond prices in a paper like this because they are subject to change and market fluctuations. Retail diamond prices are also subject to seasonal conditions and one will find that holidays and gift giving times such as Christmas tend to bring about severe prices from retail outlets while the spring and summer months will often evoke a more favorable estimate from a retailer who needs to make his rent that month.

Wholesale diamond prices should not change too much due to seasons or gift giving times. Wholesale prices will vary when the market demands exceed supply and also tend, as with gold, to function somewhat independently and opposite of "soft" currency such as the dollar.

The price one pays is determined by how much the seller wants to sell the stone and how much the buyer wants to buy it. Obviously in certain situations, stones are cheaper than they would be in a high markup area such as with a retail jeweler.

A stone may come with an appraisal sheet from one of the two gemological societies recognized in America. This sheet, as we have seen, details a number of qualities about the stone and will establish an appraised price. A couple things one should be aware of about appraisals; the first is that they're invalid generally.

Appraisals are an instrument designed for insurance companies to establish a possible price on a diamond that includes a number of factors such as increase in value during ownership. The appraisal sheet will be inflated over the value of the diamond. One never expects to pay full appraisal price for a diamond and if one does, the term "saw you coming" falls quite aptly into place.

Appraisals also vary from person to person even with accredited gemologists. The same stone can bring about two entirely separate appraisals that may differ in value by hundreds or even thousands of dollars. Again, the appraisal is a piece of paper that allows the insurance company to set a value on the stone, not that the insurance company will necessarily pay off the appraisal at full price either.

One cannot make a living by buying diamonds, having them appraised and then reporting them to the insurance company for too long.

Appraisals, on a very general basis, tend to be nearly double the price that a stone will actually sell for. This is a very wide statement and some appraisals will, of course, be closer to the actual value of the stone than will others.

Appraisals cost money and if you are good enough to sell the qualities of the stone after a little bit of practice, your own word and your own peace of mind will be more valid than a piece of paper.  You are buying a piece of paper that someone else may not want to buy.

One should actually consider that one is buying the stone, not a piece of paper telling one how valuable the stone is. This could be compared to buying a car because the owner wrote an article about how exciting the car was. Needless to say one should base the actual purchase price on the vehicle itself.