Grey market pricing, I am confused

[BillA]

It seems that the flipping market is dead, with exception of a few hot pieces. Many on the forum are getting “the call”, some have waited a while others not so much. When I look at the FS section which is made up mostly from our TS group, their prices are still thousands of dollars above MSRP. Who is buying? I don’t understand this asking price model while the market has cooled significantly.

[espanol]

Prices are all over the place at the moment. Long standing dealers seem a bit delusional on pricing. Backpack dealers have a greater need for cash flow so they price things more aggressively, or even cut losses and get out of the business in general.

[Moondoggy]

Most know to look down wind and adjust accordingly.

[BraveBold]

In many instances thousands above msrp is indeed current market pricing. You can see this in auctions data, other visible transactions.

Now, if some remain well above market prices, I don’t expect their inventory to move. It will adjust eventually…

[1William]

Asking and getting are two different things. I have found that having a discussion and making reasonable offers has worked. The Trusted Sellers know the market better than us and except for a few pieces, Platinum Daytona/SS Pepsi, some watches have corrected. A lot of people have tried to get into market forecasting and that is a difficult task. I have been in this for more than 30 years and in the long run nothing gets cheaper.

[rod727]

Originally Posted by espanol

Prices are all over the place at the moment. Long standing dealers seem a bit delusional on pricing. Backpack dealers have a greater need for cash flow so they price things more aggressively, or even cut losses and get out of the business in general.

I have never heard the term “backpack dealers” but I get the reference.

[Hollie_Rollie]

The fact that the grey market is all over the place is a good thing for us. To another posters point, some are pricing low and trying to convert to cash while others (like DavidSW) are holding firm. Hope those holding firm don’t overplay their hand.


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[Hollie_Rollie]

Originally Posted by 1William

Asking and getting are two different things. I have found that having a discussion and making reasonable offers has worked. The Trusted Sellers know the market better than us and except for a few pieces, Platinum Daytona/SS Pepsi, some watches have corrected. A lot of people have tried to get into market forecasting and that is a difficult task. I have been in this for more than 30 years and in the long run nothing gets cheaper.

Well, except for the fact that used watches used to get cheaper. Ie if you owned it for 2 years, if the watch had wear and tear, if it was a current production model about to go for service, if it was an unpopular model, etc etc

These are all factors which would make a current production watch cheaper than msrp. So looks like we’re heading that way eventually. It’ll probably take a little longer but buying the “dip” is no longer a concern. It’s going down


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[GB-man]

Originally Posted by rod727

I have never heard the term “backpack dealers” but I get the reference.

Backpack dealer: 25-35 year old male hailing from Miami, LA or Texas that believes they know a great deal about watches since entering the hobby in Q2 2020. Their inventory consists of a JM Daytona, Pepsi, Batman and six different colored OPs. They moonlight as long term crypto bulls and yearn to one day rent a Lamborghini and stock/“own” a RM030.

[GB-man]

In terms of the market all we know is prices have trended lower for nearly 2 years at this point. Market peak was Q4 2021.

People are generally uncertain about their actual investments in the current economy and also happy to park cash at 5%. People aren’t buying watches as an inflation hedge right now and they definitely were for a year or so during the cash is trash 2020-2021 cycle.

I’ve been buying more than ever. So many great watches that were unjustifiably priced have come back to msrp or better. As a long time collector this is what we’ve all been waiting for.

[Bartolo]

Originally Posted by BillA

It seems that the flipping market is dead, with exception of a few hot pieces. Many on the forum are getting “the call”, some have waited a while others not so much. When I look at the FS section which is made up mostly from our TS group, their prices are still thousands of dollars above MSRP. Who is buying? I don’t understand this asking price model while the market has cooled significantly.

1. There is no reason to assume that any given dealer posts their "last/best" prices.

2. Many gray market dealers are "bag holders" at this time. They bought high and have seen demand and thus prices tumble. As always, they want/need to get every dollar out of that inventory as they can.

3. It's very hard for (potential) customers to know just where the market is. The gray dealers are mostly all over YouTube saying "the market is more stable than people think," and customers read how "the market is tumbling." Absent solid data . . . how are we customers to know just what we "should" be paying today?

BUT YES . . . the flipping market absolutely is dead. Many gray dealers aren't buying much of anything whether it's a BNIB flip or typical used or even "vintage."

[BraveBold]

Originally Posted by Hollie_Rollie

Well, except for the fact that used watches used to get cheaper. Ie if you owned it for 2 years, if the watch had wear and tear, if it was a current production model about to go for service, if it was an unpopular model, etc etc

These are all factors which would make a current production watch cheaper than msrp. So looks like we’re heading that way eventually. It’ll probably take a little longer but buying the “dip” is no longer a concern. It’s going down


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Over time prices for Rolexes have risen, inflation adjusted. Any near term correction is likely to be temporary (though temporary could be a few years) unless Rolex starts producing 20m+ watches per year…

[rlx123]

Originally Posted by Hollie_Rollie

The fact that the grey market is all over the place is a good thing for us. To another posters point, some are pricing low and trying to convert to cash while others (like DavidSW) are holding firm. Hope those holding firm don’t overplay their hand.


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David SW has always been higher than most.


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[brandrea]

Originally Posted by GB-man

Backpack dealer: 25-35 year old male hailing from Miami, LA or Texas that believes they know a great deal about watches since entering the hobby in Q2 2020. Their inventory consists of a JM Daytona, Pepsi, Batman and six different colored OPs. They moonlight as long term crypto bulls and yearn to one day rent a Lamborghini and stock/“own” a RM030.

[Gaussian]

Originally Posted by BillA

When I look at the FS section which is made up mostly from our TS group, their prices are still thousands of dollars above MSRP. Who is buying? I don’t understand this asking price model while the market has cooled significantly.

Imagine if the used car market functioned like this used rolex market.

How many of us would willingly pay above new MSRP for a used car?

It all seems absurd even if we were trying to normalize it all. . .


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[carwashchris]

It's kinda bitter sweet, if your a buyer it's easier to find the watch you want at a more reasonable price. If your a owner, the value of your collection is sinking.

My 2 cents. Chris

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[Rolexken]

Trend of what you would be offered by a grey for a watch is the true state of the market.

[codecow]

Originally Posted by GB-man

Backpack dealer: 25-35 year old male hailing from Miami, LA or Texas that believes they know a great deal about watches since entering the hobby in Q2 2020. Their inventory consists of a JM Daytona, Pepsi, Batman and six different colored OPs. They moonlight as long term crypto bulls and yearn to one day rent a Lamborghini and stock/“own” a RM030.

nailed it out of the gate.

They’re also holding inventory from Q2 2020 and instead of realizing their losses and then getting back into the game (it doesn’t matter what they trade for if you’re moving pieces) they’re going to sit there doing nothing.

As for me I am parking cash at 5% however I have been looking to possibly trade out some pieces into a big kahuna.

[ts3]

Originally Posted by GB-man

Backpack dealer: 25-35 year old male hailing from Miami, LA or Texas that believes they know a great deal about watches since entering the hobby in Q2 2020. Their inventory consists of a JM Daytona, Pepsi, Batman and six different colored OPs. They moonlight as long term crypto bulls and yearn to one day rent a Lamborghini and stock/“own” a RM030.

[Podmornica]

The secondary grey watch market is dead in the backyard pool floating face down! "Juan"

Not just that the prices collapsed - but hardly anyone is buying anything. Try selling your brand new 126711CHNR Rootbear: There's no grey dealer in the world that would pay you above the MSRP so you can flip it like back in 2021. Have the Daydate or a plain datejust? Good luck unloading that.

Dealers are full with stock bought at the peak of the market. Most are overleveraged and are hoping for market to bounce. It won't.

The 2020 is long gone. Rates are high, there's no helicopter money. People are spending their cash on vacations again. We will never see that hype in our lifetime again.

[rushca01]

I have made offers on several watches in the past month, been trying to source a 116710 BLNR and 116610. Trusted dealers WOULD NOT budge and my offer was very reasonable. Offers were also made to private parties and again my offer was fair, were talking a couple 100 off asking price and they wound’s budge. Oh well.

[77T]

Originally Posted by Gaussian

Imagine if the used car market functioned like this used rolex market.

How many of us would willingly pay above new MSRP for a used car?

It all seems absurd even if we were trying to normalize it all. . .


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Agree with market absurdity, in general term that is.

But…
If one element was changed in the used car market then it would operate like the secondary luxury watch market for Rolex, AP, PP, RM pieces.

That element is constrained production per annum.

Porsche GT3/RS, Ferrari 296, and others in that category routinely sell above MSRP due to their scarcity.


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[Calatrava r]

I have noticed many of the smaller used watch firms work on much thinner margins and have much better pricing than the bigger well known used watch companies. People are still going to buy watches and sell them to get something else as long as interest in the hobby remains. The prices may just be a little different with even discounts from ADs returning. The market is dynamic, and prices will fluctuate. As with anything, it is never a good idea to chase the highflyers while they are soaring.

[77T]

Originally Posted by rushca01

I have made offers on several watches in the past month, been trying to source a 116710 BLNR and 116610. Trusted dealers WOULD NOT budge and my offer was very reasonable. Offers were also made to private parties and again my offer was fair, were talking a couple 100 off asking price and they wound’s budge. Oh well.

For a $200 delta you chose not to buy?

Even if they had accepted that small delta, you’d still be paying well over msrp - my logic is swallow the $200 since you are already more than $2K above msrp anyway.
Just my


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[GoingPlaces]

Overhead and not to mention larger grey dealers set the market early. They probably feel if they start cutting it's a market mover. The larger grey's will be the last ones to adjust.

[Mystro]

What is there to understand? There isn’t any watches in the AD display cases to buy. You’re also never getting a SS Daytona from a AD regardless what the economy or watch market is currently trending.

[Nads786]

When I was at DavidSW in person, a customer was negotiating for a John Mayer Daytona and I heard the sales associate say, "sorry we can't go below $38K it's a buyers market right now."

[FlashinLeather]

Originally Posted by Nads786

When I was at DavidSW in person, a customer was negotiating for a John Mayer Daytona and I heard the sales associate say, "sorry we can't go below $38K it's a buyers market right now."

So you are telling me that you bought it for 38k right?

[ppierce]

Its at an inflection point right now. Similar to how housing market crashes work. People are reluctant to adjust pricing and expectations for a while once a downturn has been confirmed.

[BraveBold]

Originally Posted by 77T

Agree with market absurdity, in general term that is.

But…
If one element was changed in the used car market then it would operate like the secondary luxury watch market for Rolex, AP, PP, RM pieces.

That element is constrained production per annum.

Porsche GT3/RS, Ferrari 296, and others in that category routinely sell above MSRP due to their scarcity.


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This has been the situation for about 30+ years.