Are Watches Investments?
Absolutely, but Passion is key

Have you ever considered that the watch on your wrist might do more than tell the time? It might also make you a tidy profit. Watches have always been signifiers of taste, style and social status, but for more and more people today, they’re also seen as tangible investments.

To a degree, this has always been the case; but in recent years, the trend has accelerated. The gap between retail price and market price is rapidly widening for key, in-demand models, and those pieces are getting even harder to find. One reason for this atmosphere of excitement in fine watchmaking is the fact that watches have never been higher profile. Big auctions of historically significant watches pull in mainstream media coverage and millions of dollars. The watches celebrities choose to flex on Instagram make headlines. All this attention has led to increased demand. Higher visibility goes part of the way to explaining why watches are increasingly seen as investments, but to find out more, we spoke to an expert.

Michelle Ciesielski is the Head of Residential Research at Knight Frank Australia, and in their latest Wealth Report, which studies spending and investing habits of ultra-high net worth individuals around the world, including some 20,000 or so in Australia. When it comes to patterns of investment, this well-heeled group tends to drive trends.

Ciesielski says that the data confirms the perception of watches as an investment, noting that they, along with other luxury collectables like wine, whiskey and cars, have seen a 123% growth over the last decade. Watches have notably been the fourth most successful category at 108% growth. To put that in context, Ciesielski notes that over the same period, the global prestige property market, which consists of the top 5% of listings, has seen a growth of just 51%. In the local context, Ciesielski says, “Watches, wine and the Sydney prestige residential market all recorded 16% growth last year. So watches are keeping up with the Sydney property market.”

Of course, fine watches are more than a line item in a portfolio. They are ‘investments of passion’, much like fine art, that offer something beyond a fiscal return. The Knight Frank Wealth Report notes that collectors’ main reason for this sort of investment is the joy of ownership, followed by a desire for a safe haven, with return on investment coming in third. The emotional nature of these investments can be something of a liability Ciesielski warns, as the investment is emotional as well as financial, for better or worse.

In Australia this type of investment is more popular than ever. As travel and other typical spending patterns were dramatically altered in response to the Covid pandemic, Australia saw a 51% increase in spending on collectables, compared to 25% globally. This is in line with an increased focus on the home.

Another important factor in the rise of watches as investments has to do with our changing lifestyles. Ultra-high net worth individuals are moving away from larger properties as their primary residence, focusing on smaller footprint living. This might mean that there isn’t room for a five-car garage or copious wall space for the art collection. But a watch box, even a large one or a small safe, doesn’t take up too much space, like Kennedy’s collection of safes and watch boxes from Buben and Zorweg.

So yes, watches can be considered an investment, but not all watches and not for all people. Some might have a vault full of pristine examples, and others might see the watch on their wrist as a beautiful way to tell the time. There’s no single way of appreciating these finely crafted machines, but one thing is clear; passion is key.

Discover our curated collection of timepieces online.  

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