A watch bought at auction must rise 42% to cover the fees

Are watches a good investment?

Watches, like the other luxury and passion assets, are a good investment only when the price rises by more than it costs to buy, insure, service and sell them, and at auction that bar is high. Sotheby’s charges a buyer a premium of 28% on the hammer price, up to £1,500,000 in London and $2,000,000 in New York, with local taxes extra. Its fee structure page gives a standard seller’s commission of 10% of the hammer price, and an individual seller’s rate is whatever the seller’s contract states.

The example below buys one watch at auction and sells it at auction five years later. The $10,000 hammer price, the five-year hold and the single service are example inputs; every other input is published or reported, as the right-hand column says.

Line	Amount	Where it comes from
Hammer price paid	$10,000	Example input
Buyer’s premium, 28% of $10,000	$2,800	Sotheby’s published rate, local taxes excluded; its schedule shows an overhead premium only for wine and spirits
Cost on day one	$12,800	$10,000 + $2,800
Insurance for five years at 1% to 2% a year of $10,000	$500 to $1,000	Estimate in guides from Bezel, a watch marketplace that sells insurance (August 2026), and Grailr, a watch valuation app (October 2026)
One service	$770	Example input, set at the price Rolex’s US list shows for a six-digit Submariner or GMT-Master, as reported by Luxury Bazaar in October 2026
Total outlay	$14,070 to $14,570	$12,800 + insurance + $770
Seller’s commission at exit	10% of the hammer price	Sotheby’s standard rate
Hammer price needed to recover the outlay	$15,633 to $16,189	Outlay ÷ 0.90
Price rise needed over five years	56.3% to 61.9%	$15,633 and $16,189 against $10,000

With no insurance and no service, the two auction fees alone need a hammer price of $14,222 ($12,800 ÷ 0.90), a rise of 42.2%. Over five years, 56.3% to 61.9% compounds to 9.3% to 10.1% a year.

Sotheby’s also retains a success fee of 2% of the hammer price from a seller whose lot sells above its high estimate. If it applied here, the break-even would be $15,989 to $16,557 ($14,070 to $14,570 ÷ 0.88), a rise of 59.9% to 65.6% (45.5% for the fees alone). The tables leave it out.

All the arithmetic is Unmatched Capital’s calculation and leaves out sales tax on the premium, shipping and interest forgone on the $12,800.

The second table sets that outlay against price rises the sources on this page report, none of them a forecast. The 5.1% and 8.2% rows apply one recent year’s rise in WatchCharts’ overall index to each of five years, as an illustration. The last row applies the 2.39 times by which Hilco Global, an adviser to lenders, reports the average Rolex resale price rose from before the pandemic (about $7,185) to March 2022 (about $17,206).

Hammer price when the watch is sold	The seller receives (90%)	Result against an outlay of $14,070 to $14,570
$10,000, unchanged	$9,000	Loss of $5,070 to $5,570
$12,824, after rises of 5.1% a year	$11,541	Loss of $2,529 to $3,029
$14,830, after rises of 8.2% a year	$13,347	Loss of $723 to $1,223
$23,947, after a rise of 2.39 times	$21,552	Gain of $6,982 to $7,482

Only the last row beats the outlay.

What does it cost to buy, insure, service and sell a luxury watch?

A luxury watch costs its buyer a premium on the way in, an insurance premium every year and a service every few years, and costs its seller a commission or a discount on the way out. The same round-trip arithmetic applies to collectibles and whisky casks. The figures below are as published or reported, and the right-hand column says what kind of figure each is.

Cost	Figure	Kind of figure
Buyer’s premium, Sotheby’s	28% of the hammer price up to £1,500,000 (London) or $2,000,000 (New York); 22% between £1,500,000 and £6,000,000 or $2,000,000 and $8,000,000; 15% above that; local taxes extra	Published price schedule, updated 9 September 2026
Buyer’s premium, Bonhams	For sales from 1 October 2026, the premium on a hammer price up to £25,000 moves from 28% to 30%; VAT, GST or local sales taxes are charged on the premium where applicable	Published price schedule
Insurance	1% to 2% of the watch’s value a year: $100 to $200 on a $10,000 watch and $300 to $600 on a $30,000 watch	Estimate from a marketplace that sells insurance (Bezel, August 2026)
Servicing	$660 for a six-digit Datejust, $770 for a six-digit Submariner or GMT-Master and $940 for a new Daytona on Rolex’s US list, with refinishing extra; Gray & Sons, an independent repairer, reports that Rolex now recommends a service about every 10 years	Price list as reported by Luxury Bazaar (October 2026); estimate by Gray & Sons, a repairer
Seller’s commission at auction	Sotheby’s standard is 10% of the hammer price, with a minimum of $500 on any lot with a low estimate of $5,000 or less; Grailr (September 2026) says to expect 5% to 15%, plus 1% to 3% for insurance and shipping and $200 to $500 a lot for photography and catalogue fees	Published standard rate; estimate by a valuation app

On Gray & Sons’ report of Rolex’s interval, a five-year hold may need no service, and the first section’s break-even would then be 47.8% to 53.3% ($13,300 to $13,800 ÷ 0.90).

Selling at Sotheby’s on standard terms needs an 11.1% rise to recover the exit cost alone, and a dealer buying outright needs 42.9% to 66.7%. The last column below divides 100% by the share the seller receives and subtracts 1, before any buying cost (Unmatched Capital’s calculation).

Way out	What the seller receives	Source	Rise that recovers the exit cost alone
Sotheby’s auction, standard terms	90% of the hammer price	Sotheby’s	11.1%
Auction, all costs counted	80% to 85% of the hammer price	Grailr, September 2026	17.6% to 25.0%
Chrono24 private listing	93.5% of the sale price, after a 6.5% commission	Grailr, April 2026, reporting Chrono24’s rate	7.0%
Dealer trade-in credit for a long-standing client	80 to 85 cents on the dollar	An example Hilco gives, August 2026	17.6% to 25.0%
Dealer consignment	The dealer takes 15% to 25% of the eventual sale	Grailr, April 2026	17.6% to 33.3%
Dealer buying outright	30% to 40% below market value	Grailr, April 2026	42.9% to 66.7%

Bezel sells watches and insurance, Grailr sells valuations and Hilco advises lenders, so these are vendor and practitioner estimates, and none is measured transaction data. Grailr itself calls its figures indicative editorial estimates.

Do luxury watches increase in value?

Luxury watches rose sharply in price between 2020 and March 2022, fell by 31% to August 2023 on one measure and stood 23.9% below the peak in early 2025 on another, and have recovered only part of the fall. Whether a particular watch gained depended on its brand and on the date it was bought.

Source and measure	Period	Figure
CNBC, citing WatchCharts: overall prices	August 2020 to August 2023	About 20% higher
CNBC, citing WatchCharts: average Rolex, Patek Philippe, Audemars Piguet	August 2020 to August 2023	Up 26%, 94% and 100%
CNBC, citing WatchCharts: average price of a secondhand watch	March 2022 to August 2023	Down 31%
Insight Luxury, reporting Chrono24’s ChronoPulse index	March 2022 high to the end of March 2025	Down 23.9%
Hilco, citing WatchCharts: average Rolex resale price	Before the pandemic to March 2022	About $7,185 to about $17,206
Knight Frank, reporting WatchCharts: overall market	The last year, as stated in April 2026	Up 5.1%
Hilco, citing WatchCharts: overall market	Twelve months to February 2026	Up about 8.2%

The two falls differ in date and in basket. CNBC’s figure is an average secondhand price, whilst ChronoPulse, according to Insight Luxury, is built from more than 600,000 transactions across 14 brands and over 140 models since January 2019. The recent gains are smaller than the 2020 to 2022 gains. Knight Frank found WatchCharts’ Rolex index up 4.6% and its Patek Philippe index up 12.1% over the same year as the overall 5.1%, in a year when its wider Luxury Investment Index closed 2025 down 0.4%.

Hilco describes the market as well off its peaks in mid-2026. Hilco puts the retail price of Patek Philippe’s discontinued reference 5711 at around $34,000 and its current trading range at about $113,600 to $147,700.

Unmatched Capital’s position is that a watch bought at auction, with a buyer’s premium on top of the market price, is a consumption purchase with a resale option, and the 56.3% to 61.9% rise in the first section is the number to test that option against. By the index figures above, Patek Philippe and Audemars Piguet cleared a bar of that size in the three years to August 2023, whilst Rolex (up 26%) and the overall index (about 20%) did not. The strongest counterargument is that the gains went to buyers who paid list price, with no 28% premium. That is correct, and it changes two things at once, the purchase price and the selling route, which are best taken one at a time. On the example’s inputs, a buyer who pays $10,000 with no premium, adds the same insurance and service, and sells at Sotheby’s at 90% needs a hammer price of $12,522 to $13,078 ($11,270 to $11,770 ÷ 0.90), a rise of 25.2% to 30.8%. Selling on Chrono24 at 93.5% instead needs a sale price of $12,053 to $12,588, a rise of 20.5% to 25.9%, and an auction buyer who sells on Chrono24 needs 50.5% to 55.8% (all Unmatched Capital’s calculation). No source on this page shows how often a buyer could get those references at list price. The lower bars therefore describe a buyer who can, and the position applies to the buyer who pays the premium at auction.

Which watch is best to invest in?

The sources on this page cannot name a best watch to invest in, and Unmatched Capital does not recommend one; they show four things that have moved resale prices, each of which a buyer can check against a specific watch.

In WatchCharts’ update through February 2026, as Hilco reports it, the brand indices moved by different amounts: Patek Philippe’s rose 16.2%, Rolex’s about 7.9% and Audemars Piguet’s about 3.4%, whilst Breitling’s fell 1.1%.

Quill & Pad, reviewing WatchCharts’ June 2025 update, wrote that the overall index “is weighted by transaction value, and is thus heavily biased towards the Big Three”, which its page names as Rolex, Patek Philippe and Audemars Piguet. Knight Frank said in April 2026 that the dominance of the two largest brands in the secondary market masked weakness elsewhere. A watch outside those brands should be tested against its own brand’s index, not the overall figure.

Hilco puts the premium for a documented watch over an undocumented one at 10% to 30%, and recommends a minimum discount of 15% to 25% for undocumented watches against comparable documented pieces. Hilco cites no data for either figure, so they are a lender’s adviser’s estimate, not a measured spread.

A buyer at the March 2022 peak paid an average Rolex resale price of about $17,206, on Hilco’s figure, and CNBC reported the average secondhand price 31% lower by August 2023, so the date of purchase also matters.

What are the risks of investing in watches?

The main risks of investing in watches are a costly exit, fakes and missing provenance, repair bills, and price moves driven by a few brands.

Grailr says in September 2026 that about 38% of watch lots sell below their pre-auction estimate (a figure it gives without a sample or period), and its guide on selling a Rolex says to expect dealer offers 30% to 40% below market value. Hilco gives a liquidation example in which a watch that would normally sell for $50,000 might clear only $38,000 to $42,000 from a cash buyer, 16% to 24% less (Unmatched Capital’s calculation).

The Federation of the Swiss Watch Industry estimates that around 40 million counterfeit watches are produced worldwide each year, a figure WatchScanning (July 2026), which offers a photo-based authentication tool, reports beside 15.3 million genuine Swiss watches exported in 2024. WatchScanning labels the 40 million an estimate. Hilco’s minimum discount of 15% to 25% for undocumented watches prices the same risk.

Gray & Sons, an independent repairer, quotes $150 to $400 for a sapphire crystal and $400 to $2,000 or more for a ceramic bezel, repairs that are separate from the service. On Rolex’s US list, as Luxury Bazaar reports it, servicing a 1990s Submariner (reference 16610) costs $1,210 against $940 for a new Daytona, and refinishing adds $170 for five-digit and six-digit models and $330 for vintage ones.

Knight Frank’s April 2026 report says the dominance of the two largest brands in the secondary watch market masked weakness elsewhere, which is the risk for a watch from a smaller brand.

Do you pay tax when you sell a watch?

In the United States a seller can owe capital gains tax on a watch; in the United Kingdom the answer turns on whether the watch counts as an asset with a limited lifespan, which HMRC’s manual says antique watches are. GOV.UK says Capital Gains Tax is payable on the gain from selling most personal possessions worth £6,000 or more, apart from a car. Its page on personal possessions says no tax is due on anything with a limited lifespan, like clocks, unless it was used for business, and does not name watches. In the United States, the IRS says net capital gains from selling collectibles such as coins or art are taxed at a maximum 28% rate (page updated 24 September 2026); the page names coins and art and does not say whether a watch counts. HMRC’s Capital Gains Manual page on clocks and watches as wasting assets (CG76904) says that antique clocks and watches are regarded as machinery for the purposes of the Taxation of Chargeable Gains Act 1992, so they are treated as wasting assets, and that a disposal gives a chargeable gain only if the item was used for business purposes and capital allowances were, or could have been, claimed. The manual’s page on chattels that are wasting assets (CG76900) says that such sales are exempt unless capital allowances were or could have been claimed, or section 45(3B) of the Act applies. Those pages speak of antique watches, and how they apply to a particular modern watch is a question for the seller’s own tax adviser.

Reliefs, rates and thresholds depend on the owner, so a tax adviser should confirm the position before a sale. This page is general information.

What this means before you buy a watch as an investment

Before buying a watch as an investment, a buyer should price the round trip with the schedules for the sale they would actually use, because the break-even rise sets the bar the watch has to clear. In practice:

1. Work out the break-even for that watch, with the buyer’s premium or dealer price at entry and the commission or dealer discount at exit. The net return calculator runs the arithmetic of the first table on your own figures.
2. Get an insurance quote and the service price for that brand before buying, because both recur.
3. Ask what documentation comes with the watch, since the 10% to 30% premium that Hilco describes in August 2026 belongs to documented watches.
4. Compare the break-even with the brand’s own price history and not the overall index.
5. Check whether you would keep the watch if the price stayed flat: in the first example a flat $10,000 hammer price loses $5,070 to $5,570.

None of this is investment advice.