The global diamond market was valued at an astonishing $78 billion in 2019. How the COVID-19 pandemic affected sales isn’t clear yet, but the market remains massive. There is also a thriving market for second hand diamonds. Private sellers are quickly realising that the best place to sell their used diamonds is to professional online buying services that specialise in diamond jewelry and loose diamonds. Other options for selling diamonds may include high street jewelers or, very occasionally, design workshops.
We’ll take a look at the pros and cons of selling diamonds, where to sell, and how to get the best price in an ever changing market. We’ll also explain how to protect your personal security and avoid getting ripped off when you sell these high value assets. The good news is that you don’t need any specialist knowledge or professional connections to get a fair market price for loose diamonds or a diamond ring.
Do diamonds have resale value?
Yes, diamonds have a resale value. There are several factors that affect the price of second hand diamonds. If you understand how the market works, you can roughly calculate the actual resale value of your diamond before you approach a buyer. There will always be variations in offers, depending on the state of the market, the wider economy, the business practices of each buyer – and the size and quality of your diamond.
Any good quality loose diamond can easily be recycled into the second hand market. Jewelers are happy to snap up good quality stones at a discount. They know that there is a ready market for diamond rings with center stones between 0.5 carats and 1.5 carats in weight. If the stone is a round, emerald, oval, cushion, pear or princess cut, it will be even easier to resell. These are currently the most popular styles.
When you buy a diamond – whether it’s a loose diamond or it’s set in a piece of jewelry – the stone has already passed along a supply chain. This began at the mine where the rough diamond was excavated and graded.
- Mined, sorted and graded
- Exported to a buyer
- Professionally appraised, cut and polished
- Certification (GIA, EGL etc.)
- Resale to a jeweler or retailer.
- Resale to the customer
At each stage of the supply chain, the diamond increased in value. When you sell a used diamond, the resale value invariably drops back to the price range that the retailer paid to the supplier. This will never be more than 75% of the store price. Because your diamond is a straight purchase, and not sale or return, a jeweler will expect to reduce the price by another 5-10%. He may try to argue that the stone is worth even less because it’s second hand.
Under the best circumstances, you should expect to make a 30% loss on the resale of a store bought diamond. In a recession or global crisis, prices may drop even further. If you’re in a small town, or are limited to a small selection of buyers, you’re unlikely to get a competitive price.
It’s often a shock to sellers that the beautiful diamond that they paid so much for has a significantly lower resale value. But it’s the same with most luxury goods and consumer durables. If you buy a car, it will depreciate in value the second you drive it off the parking lot. After a few years, its resale value will be much less than the original price. For all the glitter and romance, diamonds are just another product. Jewelers may love the stones that they handle and craft, but they still have to pay the rent.
When you’re already selling at a loss, every penny counts. It’s important to go straight to a buyer who will give you a good price with a minimum of hassles. The old adage that time is money becomes relevant. If you’re taking time off work and driving around jewelry stores, you’ll need to factor that into your pricing.
How much money do you get if you sell a diamond?
The rule of thumb is that you should hold out for 70 or 75% of the original retail price when you sell a diamond. But that assumes that you’re selling during good market conditions and to a fair buyer. If you make a basic mistake like selling to a pawnbroker, you could be offered as little as 30% of the retail value. To avoid being conned, you need to know what your diamond is worth. If it came with a certificate from a recognised authority like the GIA (Gemological Institute of America) your life will be easier.
The main institutions that grade diamonds all issue certificates that precisely list each individual diamond’s qualities. Each institution has its own interpretations and definitions of quality. American jewelers prefer to see GIA or AGS certification, but a professional gemologist can quickly judge the (provisional) resale value of a used diamond from any certificate.
- GIA – Gemological Institute of America
- EGL – European Gemological Laboratory
- AGS – American Gem Society
- IGI – International Gemological Institute
- HRD – Hoge Raad voor Diamant
- GSI – Gemological Science International
If you don’t have a certificate for your diamond, and you want to sell it independently, it may be worth paying for an appraisal. A gemologist can quickly determine the value of an unmounted diamond and should charge less than $100 for the service. You can usually arrange certification with a GIA accredited jewelry store. Jewelers are used to doing insurance appraisals and it’s worth phoning around your local stores and asking. You may also get an on the spot offer, or at least some practical advice or recommendations about selling the stone.
|Important: When you have a certified diamond, you shouldn’t confuse its theoretical retail value with its resale value. At the end of the day, a diamond is only worth what a buyer is prepared to pay for it. |
There are three advantages to having a certificate:
You have a clear starting point when you attempt to calculate the value of your diamond.
When you approach a buyer, you will seem better informed and less naive.
Depending on the buyer, a recognised certificate can make the sales process faster and simpler.
How much is a 1 carat diamond worth?
A flawless, round cut, D color graded 1 carat diamond is worth $15,000 at current prices. There will always be some price variations, depending on the seller and the exact stone. But $15,000 is a realistic price for a top quality 1 carat diamond. At the other end of the scale, you can easily pick up a lower quality 1 carat diamond – that is still good enough to be mounted on a ring – for $2,000. The art of buying diamonds is in finding a stone with low gradings, but good ‘eye clean’ qualities.
The current average prices are shown below. You’ll notice that there is a wide variation in the price per carat for each weight class. The optimal resale price is calculated from the average retail price. It assumes that you found a reliable buyer who is willing to pay the highest market price for your used diamond. You can adjust the average retail price to match your diamond.
|Diamond Carat Weight||Price Per Carat||Current Price Range||Average Retail Price||Optimal Resale Price|
|0.50 Carat||$1,100 – $7,690||$550 – $3,845||$1,000||$750|
|0.75 Carat||$1,810 – $8,800||$1,360 – $6,600||$2,400||$1,800|
|1.00 Carat||$1,910 – $15,650||$1,910 – $15,650||$4,280||$3,210|
|1.50 Carat||$2,985 – $22,330||$4,480 – $33,500||$9,360||$7,020|
|2.00 Carat||$4,025 – $42,180||$8,050 – $84,360||$15,280||$11, 460|
|3.00 Carat||$6,190 – $50,070||$18,580 – $150,220||$40,830||$30,622.5|
|4.00 Carat||$7,575 – $68,130||$30,300 – $272,520||$70,320||$52,740|
|5.00 Carat||$8,430 – $70,370||$42,150 – $351,850||$105,010||$78,757.5|
Is cash for diamonds legit?
Selling diamonds for cash is an entirely legitimate transaction. The global diamond industry is worth almost $80 billion dollars a year and is dominated by multinational companies like the famous De Beers Group and its competitors Tanishq, Nakshatra and DDamas. Thousands of independent jewelers and diamond dealers have their own niches in the market and conduct business across the world.
Paying cash for diamonds is no less legit than paying cash for any other item. But there is a lot of public confusion about whether buying and selling diamonds is legal or ethical. These concerns stem from two specific issues. The first is the problem of blood diamonds, the second is that diamonds are sometimes used as a form of currency by organised criminals. These issues have little relevance to the legitimate day to day diamond trade. A recently divorced woman who sells her diamond wedding ring to the neighborhood jeweler for cash is hardly part of a criminal conspiracy.
Blood diamonds (also known as conflict diamonds) got a lot of media attention and even inspired movies like the 2006 thriller Blood Diamond. These stones were mined, often by slave labor or children, in West Africa. Their sale was controlled by local militias and rebel armies. The profits were used to finance brutal civil wars and insurrections.The trade in blood diamonds was built on systematic human rights abuses and caused an international scandal.
The Kimberly Process and Clean Diamonds Trade Act were brought in to try and prevent the trade in blood diamonds. New blockchain technology is also highly effective in tracking the movement of diamonds across national borders and pinpointing their origin. If you’re trying to sell a used (store bought) diamond for cash, you’re not involved in the blood diamond market. Any sale is completely legitimate.
Because diamonds are small and easy to conceal and traffic, they are sometimes a popular form of currency for criminals. It’s much easier and safer to move a tiny pouch of diamonds through an airport than it is to transport a suitcase full of cash. A gemologist can quickly assess the real value of any diamonds and they can easily be resold. This kind of criminal activity has no relevance whatsoever to the legitimate diamond trade. If you accept cash for diamonds, your only possible legal issue will be any personal tax liability.
Where to sell diamonds?
If you want to sell loose (unmounted) diamonds or diamond jewelry for cash, your best option is to contact an online jewelry buyer like Gemesti. They will invariably offer the highest price, and their service is pretty much unbeatable. There are 5 main advantages to selling diamonds online:
- High prices based on gemologists appraisal
- Cash payments – usually within 48 hours
- Nationwide door to door courier service
- Full insurance and personal security
- Personal customer service manager
|How to get cash for diamonds in 48 hours|
|Go to gemesti.com and complete a simple online self assessment form||10 minutes||1||Simple online form with the option to upload:CertificationReceiptsDigital photos|
|Get a call back from a customer service manager and receive an initial offer based on the information you provided.||5-10 minutes||1||Simple. Your trained customer service manager is patient and helpful and will explain the sales process.|
|Arrange free secure shipping by FedEx courier.||15 minutes for home collection.|
Longer if you take the item to a FedEx office
|1||Moderate:You’ll have the option to print a FedEx label and arrange collection, or you can receive a scannable code to your cell phone and take your item to your local FedEx collection point.|
|Overnight shipping to the EGL US laboratory.||12 hours||1||N/A|
|Free appraisal by an independent gemologist||30 minutes||2||N/A|
|Callback from your customer service manager with a final offer.||5 minutes||2||Simple: Your customer service manager will talk you through the rest of the sales process.|
|Sign and upload sales agreement and bank details.||15 minutes||2||Moderate:You’ll need to check your email, download some forms and resend the signed version.|
|Money transferred to your bank account||1 hour |
Your money will be transferred immediately. It may take longer for your bank to process the payment.
|2||Simple: Check your account – your money will be there shortly.|
Selling your unmounted diamond online is fast, secure and convenient. You needn’t have any worries about walking around in public with a diamond or cash in your pocket. Nor will you have the unpleasant chore of visiting jewelers stores and negotiating with sales staff. The online business model streamlines the whole process and protects your personal security and privacy. It’s not an anonymous service, but it is extremely discreet. Nobody except the customer service manager and your own bank will know that you have sold a diamond or diamond jewelry, or that you have come into a sum of money.
The other big advantage of selling diamonds online is that a service provider like Gemesti covers the entire country via FedEx. If you live in a small town and don’t have access to jewelers, you still have access to FedEx. You can complete the online self-assessment form any time of the day or night and get the process started. You also have a high level of flexibility with the free shipping. You can arrange to meet the courier at any location, or you can go directly to FedEx.
Because your diamond is appraised by an independent gemologist, you’ll get a competitive price based on the diamond’s actual market value. Online buying services are already paying up front for FedEx shipping and insurance. If clients reject their offers, they’ll also have to pay to return the item. It’s in their direct interest to make a fair offer and close the sale without any fuss. When you sell online to a professional company, you’re guaranteed a better price than most local dealers will pay.
It is always possible to sell diamonds, but these days there’s no need to sell to a local jeweler. You could search online for a diamond dealer, but most of these businesses are located in the jewelry quarters of big cities. Unless you have easy access to the neighborhood, there’s not a lot of point in contacting them. They’re unlikely to disrupt their daily business routine to buy a single loose diamond through the mail.
Selling to a pawnbroker is a bad option. Any initial offer will be insultingly low and it’s pointless to bargain. The final offer will still be well below the price range that you’ll get if you sell online. The fastest, safest and most profitable option is to go directly to the experts whose entire business is built on buying used diamonds and diamond jewelry. They have the professional knowledge, skills and resources to give you the best possible service and prices. They also care about their business reputation and only want satisfied customers.