Selling a Diamond: Private Sale vs. Auction
When it comes to selling your diamond, you’ll be looking for the best method that brings the highest selling price, the easiest process, the quickest sale and the best level of customer service. With these key elements in mind, we consider which is the best way to sell: via private sale or through auction?
Selling diamonds at auction
The process involved with selling a diamond at auction is pretty much the same as it is for auctioning any other item. First, the house will set a reserve price for your stone. The reserve price is the lowest amount of money you would be happy to sell your diamond for, so you should make sure that this is set at a price you’re comfortable with prior to the auction.
At the auction, potential buyers who are interested in your diamond will be given a brief description of the stone, for example its weight, colour and clarity, before the auctioneer opens it up to a bid. The person who bids the highest amount for the stone will purchase it at that price.
The auction house then takes either a set fee or a percentage cut of the final price fetched by the stone. Whichever it is, it will be discussed with you prior to entering your stone into auction.
Disadvantages of selling at auction
Not all diamonds will be accepted
A lot of reputable auction houses have a tendency to focus on selling rare stones, such as fancy colour diamonds, and will not be willing to feature or make a huge effort to sell the more commonplace, less rare stones that most regularly appear in jewellery.
Fancy colour diamonds are more likely to do well at auction because they are actively sought after by wealthy collectors.
It takes a reasonable amount of time and effort
With so many variables at play in selling at auction, most sellers will commit to conducting several hours of research in order to find the right auction house for their diamond.
If you’re going down the route of selling at auction, you’ll want to make sure that you sell through a reputable and respected auction house. If you manage to find one that is willing to sell your diamond on your behalf, you’ll then want to make sure you’re working with an auctioneer that has necessary specialist knowledge (as well as experience in selling similar items), sees the value in your item, and knows how to encourage buyers and pique their interest.
You should also ensure your auctioneer is open about providing you with the following information:
- Any fees that may be associated with the sale
- Details relating to their selling process (the process can be more complicated in some auction houses than in others)
- Details about how and when you should expect to receive your payment in the event of a successful sale
- Their interest in your stone – the more interested they are, the more likely it is that they’ll be able to rouse interest in potential buyers
- The reserve price on your stone – be sure to clarify your reserve price and set it at a level that you’re comfortable with
- The time and location of the auction. Auctions are very rarely carried out daily. More often than not, they are held on a weekly or monthly basis, so this may not be the best selling method for you if you’re looking for a quick sale.
There’s no guarantee that your diamond will sell
While it may be every seller’s dream to see buyers engaged in a bidding war over their item at auction, the chances of such an event when auctioning a diamond are quite slim. In fact, the majority of diamonds tend not to perform very well or reach their full potential selling value when being sold at auction.
The success of your sale comes chiefly down to chance. It’s all about selling at the right time and getting your diamond in front of the right audience, and you could be forced to return to auction several times before a buyer is found and the sale is successful.
There will be fees involved
Upon the sale of your diamond, the auction house will take a fee of the final sale price. The fee/commission for selling your diamond can very between auction houses, so it’s important to consider this when setting your reserve price. Many auction houses will take a 25% fee from the buyer and a 5% commission from the seller, meaning losses would reach a total of 30%.
It may be that, once this fee is deducted, selling at auction is not the most profitable option available to you. For this reason, it’s important to research your other options and obtain an idea of what other buyers would be willing to pay for your diamond before you enter it into an auction.
Selling with We Buy Any Diamonds
There are several advantages to selling your diamond to a private buyer such as We Buy Any Diamonds:
- Your diamond will be evaluated by a specialist, who will provide a report on the quality of your diamond, including its clarity, cut and colour.
- Our specialist will then provide a detailed, honest and accurate valuation, outlining the price we would be willing to offer for your stone. You can choose to accept or decline this offer, although it’s very unlikely you will find one that beats it elsewhere!
- Ours is a very simple, straightforward process, with no hidden fees or additional costs.
- Unlike with an auction, choosing to sell with us gives you a guaranteed buyer (the clue is in the name!).
- We value our clients and take pride in the high level of customer service that we continually strive to provide. Should you need to contact us at any stage of the process, you’ll be able to get in touch via telephone or email.
- Payment will be made promptly, direct to your bank account, after you’ve completed our simple, four-step selling process.