Last year two anonymous phone bidders made history when their feverish nine minutes of bidding ended with a Patek Philippe 5016A selling for $7.3m – 10 times its estimate. The crowd at the La Reserve Hotel in Geneva burst into spontaneous applause, delighted to have witnessed the sale of the most expensive wrist-watch ever.
Stories like this clearly don't come along every day, but ones in which watches end up selling for six or even seven figures are increasingly common. In May a Rolex Daytona “Paul Newman” Ref. 6263, one of only two known to exist with a brown “tropical” dial, sold for a shade over $2m.
These tales are music to the ears of watch collectors – the idea that one day their endeavours will end not only with a box full of wonderful timepieces, but a big-money payday. It's the ultimate example of having your cake and eating it: you get to own some of the most technically accomplished items on the planet – wearable status-symbols that are more practical than a yacht, more sophisticated than a Ferrari, more enduring than a fine wine – and you can make a profit, too.
Rolex reignited the debate at this year’s Baselworld with its double-whammy announcement that it is both releasing a new Oyster Perpetual Cosmograph Daytona, and discontinuing the previous model, leading to a frantic gold-rush to get hold of what's being dubbed the most collectible watch ever made.
“I've been working in the industry a long time and I don't think there's been a single watch launch that's had the same reaction,” says Nick Tolfree, Boutique Manager at Rolex, One Hyde Park. “We had about 70 cold calls about it the day it was announced. Based on our past allocation, that would fill us up for six years. We did an event in May and two guys – one wearing a Vacheron, the other an AP – slammed down their black Amexs and said 'I'll pay higher than the other guy'. We had to politely decline them both.”
The new Daytona – the fourth iteration of the classic watch introduced in 1963 – is far more limited in its supply than “entry-level” pieces from Rolex, although nobody outside of Geneva knows exactly how many are being made (to put in in perspective, it's a fair estimate that there won't be enough in the UK to supply a single watch to each of the 120 Rolex dealers). In that respect, the Daytona is a bona fide investment piece, sure to appreciate in value from day one. The problem is, retailers are only selling them to their most valued customers and, trust me, you'll have to pry this watch from their cold, dead wrists. No wonder: it's a beauty, its ceramic bezel harking back to the original but with all the benefits of Rolex's cutting-edge operation.
So where else should you look for a watch that's likely to appreciate – or at least hold – its value? Well, in the sub-£10,000 market, it will probably be another Rolex; one of its “professional” watches such as the Submariner or GMT. One to watch is the Deepsea people are calling the “James Cameron”, which features a dial that fades from deep blue to black, launched in commemoration of the film director's voyage to the bottom of the Mariana Trench. It has a waiting list of a couple of years and a decent chance it will be discontinued (thus limiting supply): both good indicators it will hold its value. If you have rather more to spend, any Patek will hold its value well, although if the advertising campaign is anything to go by, you'll be giving it to your children rather than selling it.
But buying a watch with the expectation of making a profit – certainly a quick one – is probably the wrong approach. The big-money auctions are all vintage watches at least 20-30 years old, and working out which pieces will be desirable in three decades can be like divining the future from tea leaves. You can bet the original buyer of the “Paul Newman” described above had no idea his or her £200-300 outlay would eventually reap such astronomical rewards.
That's not to say watches shouldn't be viewed as an investment of sorts: a good mechanical timepiece will hold its value far better than most other luxury goods. Wine is a notoriously difficult and fickle investment market, with many chateaux and regions horribly over-priced. Try selling a sports car with 100,000 miles on the clock for a profit and you'll be laughed out of the auction house. Property, of course, is a safer bet, but the barriers to entry are high and it's all business: you can't fall in love with a property empire in the way you can a watch collection.
“A watch should be something you buy to enjoy,” says Tolfree. “It should be worn and loved, not squirreled away in the hope it might increase in value. And who knows, in 20 years time, you might have a nice surprise.”