How is the Value of Possessions Assessed?

By • Jan 2nd, 2013 • Category: Personal Finance

These days, a lot of us consider either selling some of our valuables or using an online pawnbroker to secure a loan against them. I don’t know about you, but I’m never quite sure how the value of things like jewellery and watches is worked out. So, it’s hard to know what’s actually worth trying to take out finance against and what isn’t.

Of course, you can get experts to help you out with that (in fact, if you go down the loan route, this will happen automatically, since a valuation is needed to determine whether you can actually get a loan or not). I reckon it’s also worth understanding the basics of how these things work anyway, though, just for your own peace of mind.

So, I’ve put together a quick guide to how the value of various possessions is assessed. I hope it helps!

If you’re lucky enough to possess some diamonds, you’re likely to find these are particularly good for securing loans against – especially since they’ve been going up in value in recent years. Here are a few of the main things taken into consideration when they’re valued:

  • Cut: This refers to the quality of the cut, rather than the actual shape of the diamond. I won’t get bogged down in the finer details, but the cut should bring out the diamond’s brilliance – it is the cut that gives it its characteristic sparkle and shine. The better the cut, the more impressive it looks and the more valuable it is.
  • Clarity: Precious stones often contain little imperfections (industry folk call these ‘inclusions’) – the fewer there are of these, the greater the value of the diamond.
  • Colour: You might have noticed some diamonds are yellowish in colour, while others seem to be virtually colourless. Generally speaking, the less of a colour a diamond has, the rarer it is and the more it is worth.
  • Carat: This refers to the weight of the diamond. It’s important to remember that this doesn’t actually determine quality, though.

Jewellery is even more complex to value, since it can feature diamonds and other gemstones, as well as precious metal. In terms of the stones themselves, you can use the above as a guide, since these criteria are broadly applicable, rather than being confined to diamonds alone.

Gemstones aside, how else is jewellery valued?

  • Hallmarks: Each piece of valuable jewellery should have an official hallmark, which is basically a guarantee of its quality.
  • Metal: As I’m sure you’re aware, some metals are more valuable than others. Platinum is very valuable, as is white, rose and yellow gold.
  • Daily gold prices: The value of gold is forever in flux, so when your jewellery is valued, its worth will be judged in line with the most recent prices.

Fine watches
Next up is fine watches, which are valued very differently to jewellery. Among the most important factors in determining value is the brand and model you own – but what else matters?

  • Whether you have its original box and papers: If you do, you’re likely to get more money for your watch.
  • The condition it’s in: Any damage (even small things like a slight scratch or a little dent) can cut down its value.
  • How old it is: Personally, I’d have thought the older the watch, the more valuable it would be – but, actually, it’s usually the other way round. The newer the watch, the more likely you are to get a higher price for it.


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