It's easy to fall into the trap of thinking that jewelry appraisal valuations and selling prices should be similar, but this isn't the case. There are many reasons, but it comes down to the fact that appraisals and selling prices serve two different functions. People use appraisal valuations for insurance purposes (and sometimes tax purposes) and to establish a general baseline of the item's potential selling price. The selling price refers to what the jewelry item is worth on the market, or in other words, what someone is willing to pay for it.
The appraisal valuation and selling price can sometimes be similar, but this is rare. In most cases, you'll find that the appraisal valuation is much higher than the cash value for jewelry, sometimes as much as twice as much.
If you're still confused about the difference between jewelry appraisals and selling prices, this is the page for you. Here, we'll outline everything you need to know, which can help to clear up any confusion if you're considering selling gold or other valuable items.
What is Jewelry Appraisal?
Jewelry appraisal occurs when a professional appraiser assesses an item of jewelry, gold, or other valuable metal to assign a value. They'll look at the item's quality, weight, brand, and other critical pieces of information before placing a dollar value on the piece. It's a standardized craft, and all appraisers follow the same methods, but there can be differences in the value that they assign. You can think of appraisers as setting the value of an item as it was when it was brand new rather than what the price may be in the future.
What is the Jewelry Selling Price?
A whole host of factors determines the selling price of an item, but the most influential factor is what the item is worth on the market. Or, in other words, what someone is willing to pay for it. This can fluctuate depending on market prices, demand, and other vital elements that have little to do with the original gold appraisal since the information used to set the appraisal is no longer relevant. As such, there's usually a big disconnect between the valuation of an appraisal and what someone may realistically sell the item for.
The Benefits of Jewelry Appraisals
So far, we've made it sound like a jewelry, gold, or diamond appraisal wastes time. But that's not the case. There are plenty of benefits to appraisals! The most obvious benefit is that it helps from an insurance perspective. If you want to insure your item — and you should, since doing so offers much security — then the item will need to be appraised.
Your insurance company will use the valuation set during the appraisal process. If the item is damaged, lost, or stolen, you'll receive compensation for the full value of the appraisal.
You can also use the appraisal as a baseline for any future sale. Of course, it's important to remember that the selling value will likely be nowhere near the appraisal valuation. The appraisal valuation will be the maximum amount of money you could sell the item for under perfect economic and market conditions (which will never happen). However, it can be a useful starting point — if your item has an appraisal valuation of $20,000, you would know the selling price could be $8 - 10,000. It gives you something on which to base your selling price on.
The Downsides of Jewelry Appraisals
Jewelry appraisals have no downside if you want to insure your item. You'll probably need an appraisal since most insurance houses won't insure jewelry without one.
However, remember that the appraisal valuation will be irrelevant if you want to sell your jewelry. Most buyers won't ask to see your appraisal because it doesn't impact their grading process (assuming you're working with a reputable jewelry company). This allows them to create a market value in its current form without factoring in the original sale price. One downside of jewelry appraisals is that they can make unrealistic expectations from the seller's perspective. Just because your item has an appraisal valuation of $25,000, that doesn't mean that the item is effectively a $25,000 nest egg. As such, it's important not to pay too much attention — or perhaps any at all — to the appraisal price.
What's the Link Between Jewelry Appraisals and Selling Prices?
We've established little connection between an appraisal valuation and the selling price. So is there any link at all? One smart way to think about it is that appraisal valuation reflects the original valuation of the item; in other words, when it was 'new.'. The selling price reflects the 'used' price of the item. If you're selling a ring because you're looking for cash for gold, you won't get the cost of what you paid when you bought the ring. You'll get the value of the ring in its used condition.
Working with Reputable Companies
If you're looking to sell an item of jewelry, it's important to work with a reputable company with experience in buying jewelry. This will help ensure you are offered a fair price for your item. In some cases, companies that purchase jewelry can take advantage of unsuspecting sellers by offering a buying price that's significantly lower than they would be able to receive if they sold to another company.
Before agreeing to sell your item to a company, you must do your homework to ensure they're trustworthy and experienced. Knowing the appraisal valuation of an item can help you determine whether someone is offering you a fair amount of money. Plus, by working with the best, you'll ensure that the process is as straightforward as possible from beginning to end.
How to Maximize the Cash Value of Jewelry When Selling
If you're selling jewelry for cash, you'll want to get as much money as possible for the item. After all, you can only sell it once. To get the most amount of money from your item of jewelry, we recommend that you follow the following steps:
Make it Presentable
An item that someone has taken good care of will receive a higher quote than someone neglected. You can't go back in time and change how you care for the item, but you can take some steps to make the jewelry more presentable. For example, you can have the item cleaned and have any damaged parts repaired.
Have a Sense of Market Value
We've already established that you shouldn't look at the appraisal valuation too closely when selling an item since they're not very closely linked. Still, understanding the item's market value can be a good idea. This won't be a precise method since all jewelry items are different, but it'll give you an idea of what general ballpark selling price you should consider.
Sell to a Specialist Company
The best method for maximizing the cash value of your jewelry item is to sell to a company that specializes in the item you're looking to sell. There's more than one way to sell an item, but not all methods are equal. For instance, you shouldn't use risky selling options like eBay or Craigslist. It's best to go to an expert that offers professional, customer-focused services.
The Bottom Line
To recap: we can understand why people confuse jewelry appraisal valuations and selling prices. But as you'll see, when you sell an item of your own, there can be significant differences between the two. And that's because they serve different purposes. People primarily use jewelry appraisals for insurance purposes, and therefore, they reflect the item's potential value if it meets ideal circumstances. The selling price is grounded in reality and reflects what the item is worth in today's market.
That doesn't mean you should settle for any low price for your jewelry item. You can ensure that you get a fair and honest price by working with a reputable company such as us here at American Gold & Diamond Buyers. We've developed a solid reputation for providing reliable and trustworthy customer services. If you have an item that you are interested in selling, then get in touch by submitting your item information on our website.