June 28, 2023 08:38
Luxury analog watches now fetch higher returns than Samsung shares in Korea as prices of both new models and second-hand watches continue to rise.
Omega is hiking prices by six to seven percent in July. Popular models fetch premium prices even on the second-hand market.
The average price of a Rolex has risen 60 percent from US$17,636 to $28,204 over the last five years. Over the same period, Samsung shares rose 51.5 percent to W71,600 (US$1=W1,300).
Prices increased sharply in the coronavirus pandemic as rich people who were unable to travel abroad spent their money on luxury goods. Supply was unable to keep up with surging demand, which pushed up prices in the second-hand market.
Many collectors snapped up luxury watches for investment purposes. Most luxury watches are made in Switzerland, where workers dwindled in the pandemic, so it took longer to deliver finished products to stores. This imbalance is expected to continue for the next few years.
In Korea, demand is high particularly among young couples as wedding gifts or dowry. Suh Yong-gu at Sookmyung Women's University said, "The number of people getting married has decreased, but the cost of marriage has increased, and younger people tend to focus on seizing the day rather than saving up for the future."
The trend is also benefiting the market for fakes. According to the Korea Customs Service, more than W2 trillion worth of fake luxury watches were confiscated over the last five years. Fake Rolexes accounted for the biggest proportion at an estimated W306.5 billion.
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