Watch depreciation — which brands lose value and why

Watch depreciation follows a pattern similar to automobiles. The moment you purchase a new watch from an authorized dealer, it becomes a "used" watch — and the secondary market prices it accordingly. The retail markup that covers the brand's marketing, dealer margins, and warranty costs evaporates instantly.

The first year is typically the steepest drop. After that, the depreciation curve flattens, and most watches stabilize at a certain percentage of their original retail price within 3-5 years. Some watches then hold steady for decades, while others continue a slow decline.

The key difference from cars is selectivity. While virtually every car depreciates, the watch market has genuine exceptions — models that not only hold value but actively appreciate. This creates a two-tier reality: most watches are depreciating assets, but a select few are appreciating collectibles.

Depreciation varies enormously by brand. Here is a general overview of what you can expect from major watch brands over the first 3-5 years after purchase at retail.

These ranges represent averages across model lines. Within each brand, specific references can perform significantly better or worse than the average. A Rolex Daytona in steel appreciates, while a Rolex Cellini in gold depreciates. Brand-level generalizations are a starting point, not the whole picture.

The first year after purchase is where the most dramatic value loss occurs. This is the "drive it off the lot" effect that every car buyer understands, applied to watches.

Why the first year is the worst. When you buy at retail, you are paying for the brand's marketing costs, the dealer's margin (typically 30-40% of retail), the warranty, and the experience of buying new. The secondary market does not value any of these — it prices the watch based on its desirability, condition, and completeness alone.

Typical first-year losses by tier:

• ✖ Entry luxury ($500-$2,000): Expect to lose 25-40% in the first year. A $1,500 TAG Heuer Aquaracer may sell for $900-$1,100 used after a year.
• ✖ Mid luxury ($2,000-$8,000): Expect 15-30% first-year loss. A $5,500 Omega Seamaster may trade at $3,800-$4,600 used.
• ✔ High luxury ($8,000+): More variable. Rolex and Patek steel sports may gain value. Other high-luxury brands may still lose 10-25%.

The silver lining: after the first-year hit, depreciation slows significantly. A watch that lost 30% in year one might only lose another 5-10% over years two through five combined.

The watches that appreciate share common traits. Understanding these traits will not guarantee you pick a winner, but it will help you understand why some references defy the depreciation curve.

• ✔ Supply-demand imbalance. When authorized dealer waitlists stretch to years and production cannot keep up with demand, the secondary market premium grows. The Rolex Daytona, Submariner, and GMT-Master II all benefit from this dynamic. Patek Philippe's Nautilus and Aquanaut are the most extreme examples.
• ✔ Discontinued references. When a popular model is discontinued, the finite supply meets ongoing demand and prices rise. Rolex's discontinuation of the "Hulk" Submariner (ref. 116610LV) is a textbook case — prices jumped 30-50% within a year of discontinuation.
• ✔ Cultural relevance. Celebrity associations, film appearances, and social media virality can drive demand. The Omega Speedmaster's association with the moon landing, or the Royal Oak's celebrity following, create cultural cachet that supports prices.
• ✔ Brand pricing discipline. Rolex, Patek Philippe, and Audemars Piguet tightly control production volumes and distribution. They would rather have waitlists than oversupply. This artificial scarcity is a deliberate strategy that supports secondary market values.

Even if a watch is not going to appreciate, certain factors can significantly slow the rate at which it loses value. Think of these as depreciation brakes.

• ✔ Limited editions. A numbered limited edition creates verifiable scarcity. Even from brands that typically depreciate heavily, limited runs hold value better than regular production models. The key is genuine scarcity — a "limited edition" of 50,000 pieces is meaningless.
• ✔ Popular references. Within any brand's lineup, certain references are more desirable than others. The Omega Speedmaster Moonwatch, Breitling Navitimer, and TAG Heuer Monaco are iconic models that hold value better than lesser-known references from the same brands.
• ✔ Full set (box, papers, warranty card). A complete set with original box, papers, warranty card, and accessories commands a 10-20% premium over the same watch without them. For high-value watches, this can represent thousands of dollars. Always keep everything that comes with your watch.
• ✔ Excellent condition. Unpolished watches with minimal wear marks hold value better than heavily worn or poorly polished examples. Original finishing is valued by collectors, and aggressive polishing can actually decrease a watch's value by removing factory-original surfaces.

Just as certain factors protect value, others actively accelerate the rate at which a watch loses money. Being aware of these depreciation accelerators can save you from a poor financial decision.

• ✖ Unpopular models. Every brand has models that do not resonate with buyers. These "shelf sitters" at authorized dealers often end up heavily discounted on the secondary market. If an AD is willing to sell it to you without a waitlist or negotiation, that is a signal the secondary market will not be kind.
• ✖ Precious metal oversupply. Gold and rose gold versions of popular steel sports watches often depreciate heavily. The Rolex Submariner in yellow gold loses far more than the steel version because the market overwhelmingly prefers the steel model. The material cost of gold provides a floor, but it is often well below retail.
• ✖ Brand perception shifts. If a brand's reputation declines due to quality control issues, controversial design changes, or oversaturation, its watches depreciate faster. The inverse is also true — brands on an upswing (like Tudor in recent years) see improving resale values.
• ✖ Oversized or trendy designs. Watches that ride a passing trend (such as the oversized 46-50mm movement of the 2010s) depreciate as the trend fades. Classic proportions — 36-42mm for men, 28-36mm for women — tend to hold value better across decades.

If preserving value matters to you, there are practical strategies that can significantly reduce how much you lose on a watch purchase.

• 1. Buy pre-owned. This is the single most effective strategy. By buying a watch that has already taken its first-year depreciation hit, you skip the steepest part of the curve. A 1-2 year old watch in excellent condition with box and papers gives you 90% of the new-watch experience at 60-80% of the retail price.
• 2. Buy steel sports models. Across virtually every brand, stainless steel sports watches hold value better than dress watches, gold watches, or leather-strap models. The Omega Speedmaster in steel holds value far better than the Omega De Ville in gold.
• 3. Keep box, papers, and everything. Never throw away the original packaging, warranty card, purchase receipt, or any accessories. This documentation adds measurable value when you eventually sell. Store the box somewhere safe and keep the warranty card with the watch.
• 4. Stick to iconic references. The Submariner, the Speedmaster, the Nautilus, the Royal Oak — these models have decades of desirability behind them and are unlikely to fall out of favor. Newer, trendier models carry more depreciation risk.
• 5. Avoid unnecessary polishing. Collectors value original finishing. A watch with honest wear marks is worth more to knowledgeable buyers than one that has been aggressively polished, which removes metal and softens the original case lines.

Here is a general timeline of how watch depreciation unfolds for a typical mid-luxury watch (purchased new at retail, kept in good condition with full set).

Important caveat: these ranges represent typical mid-luxury watches (Omega, Breitling, TAG Heuer). Rolex and Patek Philippe timelines look very different — many models are above 100% of retail at every point in this timeline. Conversely, fashion watches from non-horological brands may retain only 10-20% after 5 years.

If preserving value is a priority, here are the watches that hold their value best at each price point.