SHORT VERSION: Here is a link to my saved search on eBay that shows cheap Rolexes that are probably worth buying. Read on to see why.
A month ago or so I wrote a post called, No One Cares if you Buy a Rolex. If you didn't read it and don't feel like doing any link-clicking, the gist of it was that when I was younger I bought a Rolex, assuming that people would be really impressed, but in the end no one noticed or cared. You can't buy your way into being interesting.
Ironically, in writing that post, I remembered how much I loved my Rolex, despite the fact that no one else cared about it. At the same time, I had stopped really using the advanced features of the Suunto GPS watch that I had, and was thinking about getting some different watch.
Maybe I ought to get a Rolex, I thought...
Getting something as a status symbol is really lame. Although Rolexes are seen as status symbols (again... that's mostly in theory because no one ever notices them), they're also really excellent watches. I don't think most people understand just how good a Rolex really is.
A Rolex (with the exception of a now discontinued line called the Oysterquartz) is a mechanical watch. That means that it doesn't have batteries and doesn't have a quartz crystal. It has a spring that is wound up either by twisting the crown, or by harnessing the energy generated through wrist movement using a rotor. The spring powers one hundred and fifty moving parts to deliver really accurate time (gaining or losing only a few seconds a day).
To be clear, a $9 quartz watch is probably more accurate than a Rolex. But then again, a photograph is more accurate than a Monet. There's something to the art of it-- the fact that these one hundred and fifty moving parts continue to work for years on end, powered only by flicks of the wrist, through conditions as varied as scuba diving hundreds of feet deep in the ocean to climbing mount Everest.
Rolex isn't the only mechanical watch to be able to do this (Omega and Tag Heuer are similar, and I'm sure there are others I don't know about), but they are real pioneers in the field and, in terms of balancing accuracy and reliability, there is no better.
The point of all this is that a Rolex isn't a jewelry watch like a Gucci watch would be. A gucci watch would most likely be a quartz watched stamped with a bunch of logos. If they do have a mechanical watch, it would have been developed by someone else, made in China, and then stamped with logos.
I personally love the idea of a manual watch. To me it's a triumph of humanity that these things exist. I love the idea that such a rugged and precise machine can be built, and that it can fit in my watch, hidden in a tiny case.
The next most interesting thing about a Rolex is that although the price tag is quite high, it could be argued that the cost of owning one is negative. That's because Rolexes tend to appreciate over time, mainly because the style hasn't changed drastically since inception, making a 40 year old watch look roughly new.
I bought my first Rolex in 2001 for $1400. Today it would sell for $1900 if I hadn't lost it. That's not an incredible return, but it's very low risk (insure the watch from theft/loss for $30/year if you want to really make it low risk), and you get to have a cool watch for many years.
Even more interesting is that right now there are insane deals to be had on Rolexes. I actually have three of them right now because I didn't realize how plentiful good deals are, and I kept jumping on deals I thought were 'once-in-a-lifetime' deals. Some examples:
1. I bought a 1991 Air-King for $1250. I thought I was going to keep it, but one week and two Rolexes later, it's going up on eBay. I estimate that it's worth around $1700-2000.
2. I bought a 1980 DateJust for $1700. I should be able to sell this one for $1900-2000, maybe more.
3. I bought and will keep a 1999 DateJust with a diamond dial for $2100. If I wanted to sell it today, I could get around $3000.
If you combine a really good deal with years of modest appreciation, you're looking at buying a really excellent watch and earning 5-10% per year average on the "investment". On the other hand, any cheap watch you buy will tend to lose value over time. I loved my Suunto and got some really good use out of it, but I sold it for about half what I paid for it after a couple years.
Anyway, I'm not trying to convince you to buy a Rolex. I'm just trying to explain what makes them worth having, and will share some tricks to getting them really cheap. My guide to buying a Rolex will focus on the DateJust, which is the classic dress watch (that can still be worn scuba-diving), but most of the tips will work for any model.
The key dates to know for a DateJust are as follows. In 1978 Rolex introduced a "quickset" feature, which makes it much faster to switch the date at the end of a 28-30 day month. My first Rolex was a 1974 and not having quickset wasn't that big of a deal, but it's a nice feature and 1978 is a good starting point.
In the late 80s, Rolex switched the crystal from acrylic to sapphire crystal. Opinion is divided on this, with most collectors and enthusiasts favoring the acrylic crystal. Acrylic definitely looks better and doesn't hold fingerprints as much, but it is easier to scratch. Buffing out scratches with a polishing cloth is pretty easy. Sapphire, on the other hand, is pretty much impossible to scratch. I prefer Sapphire because I tend to do things that risk scratching the watch, but it's a personal choice.
In the mid nineties, the case was switched to a holeless case. This is a very minor difference-- the pins that hold the bracelet onto the watch are hidden. Since then there have been no notable improvements. The quickset movement is called a 3035 and the next evolution, introduced in 199x is called the 3135. Both of them have their strong points and their supporters-- the point is that very little has changed over the years, so you can buy an old Rolex and it's essentially the same as a new Rolex. The 1980 DateJust and the 1999 DateJust I currently have are the exact same color schemes and both keep time with the same level of accuracy. Other than the different crystal, the holeless case of the newer one, and the less worn band of the newer one, they are indistinguishable.
Because you're working with around 20 years of available Rolexes (I've never seen great deals on the newest ones), you will have a LOT of watches to choose from. This means that you can take the approach of lowballing everybody until someone accepts your deal. Given the current economy, pretty much everyone takes your offer. I've really been amazed at how cheaply people are willing to let go of these watches.
The two major places to look are Craigslist and eBay. On Craigslist, just search for Rolex with an upper price of $2500. I wouldn't ever pay more than that. A late 70s watch should go for closer to $1600. Whenever you see a watch, offer a really low price that's $100 more than most people will offer. In other words, offer $2100 instead of $2000, $1600 instead of $1500. I almost got a watch for $1300 just because everyone else was offering $1200, but someone paid his full asking price at the last minute.
Don't get attached to any given watch. in this economy a lot of people are selling their Rolexes, so another one will come up. If you overpay, or fail to get a really good deal, you're largely negating the good-deal benefit of buying a Rolex.
On Craigslist the biggest advantage you can have over other sellers is to be really easy to deal with. Most people on Craigslist are not. My initial email might look something like this:
"Hey, I'm interested in the Rolex you're selling on Craigslist. I don't mean to insult you, but I think the watch is worth about $1600. I know you're asking for more, but if you're interested in that price, I can meet you at your convenience with cash in hand."
The last watch I bought was from a really nice guy who I sent a similar email to. When I bought the watch he thanked me for being so easy to work with and kept saying how glad he was to be done with selling it. Selling on Craigslist is annoying. We both know he could have gotten a bit more money if he held out, but he would have had to meet with a bunch of unreliable people who wouldn't show up with cash, or would try to renegotiate after agreeing on a price. Convenience is worth something.
If you're buying on eBay, you again want to email offers in. Most buy it now prices aren't that great, and auctioned Rolexes, by definiton, go for market price. The ideal watch to offer on is one that's been on eBay for a few days with no bids. At that point the seller might start to wonder if it's going to get bid up or just get sold for his opening price. The Air-King I bought had a starting price of $1000 and no bids. I offered $1250 and he took it. My guess is that if he left it on eBay it would have sold for $1700 or more.
Many sellers will also list buy it now prices that are unrealistic. Email them and offer them much less. I haven't actually bought one this way but I've gotten some really solid counter-offers back.
With eBay sellers you don't really need to worry about fakes. Just look for good feedback, and if it does turn out to be fake, eBay buyer protection will cover you. In person if you don't know what to look for, you might be better off meeting at a watch store, where they can verify that it's real. It's pretty easy if you know what to look for, so they probably won't charge you for the service. If they do, it would be $10-20.
There are two color schemes for the DateJust, stainless steel and 18k gold / stainless two-tone. They are the same price right now because the stainless steel is more in style. However, because the two tone one has a real gold crown and bezel, and also real gold center links in the bracelet, it probably has a higher intrinsic value. If you like that look, I bet it will appreciate more than the stainless one over time. I prefer the stainless look, though, so I've bought only stainless ones other than my first one many years ago.
There are also two ways to make the watch significantly cheaper after buying it. If you're lucky enough to get one that comes with the Rolex boxes, you can sell those for $100-200 on eBay. Resale value isn't really impacted by not having the box (DO keep the certificate if it comes with it, though), so you may as well sell them and take the cash. I got boxes with my 1999 watch, and they're on ebay right now.
You could also consider selling the bracelet of the watch and buying an aftermarket one. An aftermarket bracelet costs $25-75 and is probably better than the one that came with the watch, since the one with the watch will be stretched out a bit from use. The original bracelets go for $300 or so on eBay, which is sort of crazy. The resale value of your watch WILL decrease if it comes with an aftermarket one, but probably not by as much as you gain by selling it.
Using all these tricks, you can easily get a nice Rolex for $1000-1500 that will sell for almost twice as much. There are so many good deals out there that if I wasn't so busy, I would probably start a side business reselling them. Here's an ebay link with the search I use to find Rolexes.