Are Watches a Good Investment? An Honest Guide for Buyers
The question of whether a watch investment makes financial sense is one of the most searched topics in the collector world, and the honest answer is more nuanced than either enthusiasts or sceptics tend to admit. Some watches have delivered extraordinary long-term returns that rival equities. Many others depreciate the moment they leave the boutique. Understanding which category a watch falls into, and why, is the difference between a rewarding long-term holding and an expensive lesson in market timing.
How the Luxury Watch Market Has Performed as an Investment
The secondary market for luxury watches has grown into a genuinely significant asset class. The global pre-owned watch market reached approximately USD 25 billion, with forecasts projecting continued growth as younger, digitally native collectors enter the market and platforms like Chrono24 bring unprecedented pricing transparency to buyers and sellers worldwide.
The Post-Pandemic Cycle and What It Revealed
The watch market experienced an extraordinary boom between 2020 and early 2022, driven by a combination of pandemic-era asset inflation, social media hype, and a surge of new buyers treating steel sports watches as speculative assets. References from Rolex, Patek Philippe, and Audemars Piguet traded at multiples of their retail prices during this period, with waitlists stretching to years and dealers commanding eye-watering premiums for previously unremarkable references.
The correction that followed between 2022 and 2024 was significant. Prices across the broader secondary market fell by approximately 16 percent from their peak, with the sharpest declines affecting hype-driven references and second-tier brands that had benefited from speculative spillover. By 2024, the market had largely stabilised, and the lesson for investors was stark: watches bought purely for short-term gain during a speculative peak are among the riskiest assets in the alternative investment space.
What the Data Shows for Blue-Chip References
The performance picture looks considerably more compelling when filtered down to genuinely investment-grade references from the strongest brands. The Rolex Daytona reference 116500LN, released at a retail price of approximately EUR 13,000 in 2016, was trading in the EUR 30,000 to 34,000 range on the secondary market by the mid-2020s. That represents a compound annual growth rate of roughly 11 to 13 percent, comparable to long-run equity market returns. The Patek Philippe Nautilus reference 5711, retailing at around EUR 30,000 before its discontinuation, subsequently traded at multiples of that figure. Select Audemars Piguet Royal Oak references have followed similar trajectories.
These are exceptional cases, and they should be understood as such. For every Rolex Daytona or Nautilus 5711 that has delivered strong returns, there are dozens of luxury watches from well-regarded brands that trade below retail the moment their original buyer decides to sell. Brand prestige, reference scarcity, and secondary market depth are what separate investment-grade watches from merely expensive ones.
Watches vs. Traditional Investment Benchmarks
Compared against conventional asset classes, the best-performing watch references have held their own and in some periods outperformed. A 2023 Deloitte study found that rare, sought-after watches saw price growth of approximately 20 percent annually between 2018 and their 2022 peak, compared to the S&P 500's annualised return of approximately 8 percent over the same period. Gold grew at around 4 percent per annum over a comparable decade. However, these headline figures relate to the strongest-performing segment of the market, not average outcomes across all luxury watch purchases.
Which Watches Make the Best Long-Term Investments
Not all luxury watches appreciate, and understanding which references carry genuine investment credibility is the most practically useful knowledge any buyer can acquire before entering the market. The distinction is less about price point than it is about brand positioning, production discipline, and secondary market depth.
The Holy Trinity and Rolex
Patek Philippe, Audemars Piguet, and Vacheron Constantin are collectively referred to as the Holy Trinity of Swiss watchmaking, and their produce-in-house, scarcity-controlled model gives their most sought-after references structural investment appeal. Patek Philippe's Nautilus and Aquanaut families, and Audemars Piguet's Royal Oak in stainless steel, represent the clearest examples of watches where discontinuation, controlled production, and global collector demand have driven sustained above-retail secondary market pricing.
For a detailed breakdown of how specific Rolex investment references have performed historically and what drives their secondary market premiums, a dedicated Rolex investment guide covers the Submariner, GMT-Master II, Daytona, and Explorer families in depth. Rolex's combination of tight production discipline, global brand recognition, and an authorised dealer network that manages allocation carefully has made certain Rolex sports references among the most liquid and consistently valued pre-owned assets in the watch world.
Omega, Tudor, and Accessible Investment-Grade Picks
Beyond the top tier, Omega's Speedmaster Professional and Seamaster families have demonstrated steady secondary market support, with the Speedmaster in particular carrying an irreplaceable heritage narrative through its association with the Apollo programme. The Speedmaster Professional has been in continuous production since 1957, it was the first watch worn on the moon in 1969 by astronaut Buzz Aldrin, and its consistent collector demand reflects that history.
Tudor's Black Bay range has built strong resale credentials at a more accessible price point, benefiting from the brand's association with the Rolex family and its own increasingly credible in-house movement programme. For buyers entering the watch investment space with budgets below AUD 5,000, Tudor and Omega represent the most defensible choices from a long-term value retention perspective.
Vintage References and Independent Brands
Vintage watches from the right brands and in genuinely original condition represent some of the highest-upside opportunities in the investment watch market, but also some of the highest risks for buyers without deep reference knowledge. A vintage Rolex Submariner or Daytona in unpolished, original condition with matching papers can trade at significant premiums over more recent examples. However, the vintage market requires a level of authentication knowledge, reference expertise, and condition assessment skill that goes well beyond what most new collectors possess.
Independent brands including F.P. Journe, A. Lange and Söhne, and H. Moser and Cie are increasingly attracting serious collector and investment attention due to their extremely limited production volumes and manufacture movement credibility. These references carry higher unit prices and require deeper category knowledge, but their production scarcity gives them structural investment characteristics that mass-market luxury brands cannot replicate.
Buying Watches as Investments in Australia: A Practical Guide
The Australian market for investment-grade watches is well-developed and growing. Authorised dealer networks for Rolex, Omega, Patek Philippe, Audemars Piguet, and Tudor are established in Sydney, Melbourne, Brisbane, and Perth. The pre-owned segment has matured considerably, with strong representation on Chrono24 and a growing number of specialist pre-owned dealers operating from Australian capital cities with authentication, warranty, and servicing credentials that give buyers genuine confidence.
Australian buyers should be aware that secondary market pricing in Australia typically reflects a premium over global secondary market comparables, partly due to import duties, GST, and the cost of maintaining authorised dealer networks in a market geographically distant from Swiss and Japanese manufacturers. This means that Australian buyers comparing local pre-owned prices against international Chrono24 listings need to account for these structural cost differences before concluding that a local price is unfair.
The watch investment market has also matured in terms of information tools available to buyers. WatchCharts and Chrono24's own market data provide sold-price history, price trend charts, and market depth information for specific references that allow investors to make genuinely data-informed decisions rather than relying on dealer sentiment or forum opinion. These tools are accessible from Australia and represent a meaningful improvement in market transparency compared to even five years ago.
Here is a practical step-by-step guide for approaching watch investment decisions in Australia:
Start with a realistic investment thesis: Decide whether your primary goal is capital appreciation, inflation hedging, portfolio diversification, or enjoyable ownership with potential upside. Each goal implies a different strategy and a different risk tolerance.
Focus on investment-grade brands and references only: The investment case for watches applies to a narrow segment of the market. Stick to references from Rolex, Patek Philippe, Audemars Piguet, Omega, Tudor, and select independents. Fashion-oriented brands and most quartz references have weak to no investment credentials.
Buy pre-owned where possible: The steepest depreciation in watch ownership occurs immediately after new retail purchase. Buying a reference that is two to three years old in excellent condition with full box and papers gives you a better entry price and reduces your downside risk relative to a new purchase.
Insist on complete documentation: Always require original box, warranty card, manuals, and any service documentation before completing a transaction above AUD 3,000. Documentation adds between 15 and 25 percent to resale value and is the single easiest thing to protect at the point of purchase.
Use market data before and after every transaction: Check sold prices on Chrono24 and WatchCharts for your specific reference and condition before buying or selling. The gap between asking price and actual sold price can be significant, and pricing decisions should be based on transaction data, not listed inventory.
Plan for a minimum five-year holding period: The watches that have delivered the strongest investment returns have done so over years and decades, not months. Short-term flipping in the current market is a significantly more difficult proposition than it was during the 2020 to 2022 boom. Patient, long-term holding of genuinely scarce references from credible brands is where the most defensible investment case lies.
Insure and store your investment properly: Investment-grade watches require dedicated watch insurance that covers market value rather than replacement cost. Store pieces in a quality watch box away from moisture, direct sunlight, and magnetic fields. Keep all service records and documentation with the watch throughout your ownership.
Smart Watch Investments
Are Watches a Good Investment FAQs
Among alternative investments in the luxury category, watches from the top tier of Swiss brands have historically held value better than most comparable luxury goods. Rolex, Patek Philippe, and Audemars Piguet sports references have demonstrated sustained secondary market demand that luxury handbags, jewellery, and most collectibles struggle to match consistently. The combination of manufacture scarcity, global brand recognition, and an active and transparent secondary market gives investment-grade watches structural characteristics that most luxury goods do not share. However, the investment case applies to a narrow segment of the overall watch market, not to luxury watches as a broad category.
The watch market experienced a meaningful correction following its 2021 to 2022 speculative peak. Prices across the secondary market fell by approximately 16 percent from their highs over the following two years, with the sharpest declines affecting hype-driven references and brands that had benefited from speculative demand rather than genuine collector interest. By 2024 the broader market had largely stabilised, and blue-chip references from Rolex, Patek Philippe, and Audemars Piguet retained meaningful premiums above retail despite the correction. The correction removed speculative buyers from the market and restored it to a more fundamentals-driven environment where condition, originality, and reference credibility drive pricing.
Rolex is consistently the most liquid and widely traded brand in the secondary market globally, with certain sports references including the Submariner, GMT-Master II, and Daytona demonstrating the strongest combination of value retention and resale demand. Patek Philippe and Audemars Piguet occupy the highest tier in terms of per-unit value appreciation potential, particularly for discontinued or limited references. At more accessible price points, Tudor and Omega offer the most defensible value retention among buyers with budgets below AUD 10,000. The safest approach across all tiers is to focus on specific references with documented secondary market depth rather than brands as a whole, as performance varies significantly by model even within the strongest brands.
For investment purposes, pre-owned is almost always the better entry point. New watches experience their steepest depreciation immediately after retail purchase, as the margin built into the retail price is absorbed the moment a new buyer becomes a seller. Buying a reference that is two to three years old in excellent condition with full box and papers gives you a lower cost basis, reduces your downside risk, and means the initial depreciation has already occurred before you enter. The exception is buying a genuinely allocated reference from an authorised dealer at retail, where the secondary market price already reflects a premium over retail, making new retail the better price. This situation applies to a small number of Rolex, Patek Philippe, and Audemars Piguet references only.
In Australia, capital gains from the sale of a watch that was purchased as an investment may be subject to Capital Gains Tax under the Australian Taxation Office's guidelines for personal use assets and collectibles. Watches acquired primarily for personal use and enjoyment rather than as deliberate investments may be treated differently, but watches purchased with the intention of resale for profit are generally treated as capital assets. The 50 percent CGT discount may apply to assets held for more than twelve months. Australian buyers with significant watch investment portfolios should seek advice from a qualified Australian tax professional rather than relying on general guidance, as treatment depends on individual circumstances, purchase intent, and transaction history. This article does not constitute financial or tax advice.