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DIAMOND
APPRAISERS: Why you need one and what to
expect.
by
David Atlas, GG, NGJA, ASG Accredited Gem
Appraisers Phila. PA
Why
you need a diamond appraiser.
The
services of an independent appraiser are
increasingly of importance in today's
complex market environment. As consumers
have grown in sophistication and education,
diamonds have gotten more costly, and many
previously unheard of treatments and ethical
issues have arisen, as well. One used to
fear that a diamond might be misrepresented
as to color, clarity or weight. Now the list
of reasonable questions is nearly endless:
- Has the stone had some
temporary or permanent treatment
applied?
- Is the stone a real
diamond, a man-made diamond, a color
altered diamond, loaded with filler, or
totally phony?
- Will the dealer sell me
one stone and deliver another?
- Does the diamond match
the grading document?
- Is the stone really cut
correctly and does the grading paper
supply enough information to make an
informed decision?
This
just covers the major issues. You can see
right away that there are many opportunities
and reasons to use third party advisory
services in these transactions that
potentially will cost you thousands of
dollars. The only other thing most folks
ever buy that is similarly expensive that
has no manufacturers "list price"
like a new car, is a house. That is why so
many appraisers are equally required and
needed to confirm real estate transactions.
Expert and blind markets require non-experts
to hire qualified assistants in order to be
secure.
Retail
Replacement Value.
One
frequently misleading area that we should
cover here is that many transactions, actual
purchases, of diamonds today are at
relatively nominal mark-ups. Purchases in
the thousands of dollars may have mark-ups
near to 10% sometimes although a bit more
might be realistically required or expected,
especially where there are some overhead
costs, such as in a nice store or anywhere
service at a high level is provided.
Truly,
Retail Replacement Value on appraisals does
not need to be higher than regular
transaction prices in the market where you,
as a consumer, make your normal purchases.
Typically, appraisers will give something
more akin to "average regional retail
valuations". These somewhat inflated
values are generally used as sales tools by
many if not most retail sellers. This is
considered an abuse by some and a regular
way of doing business by most others. Just
knowing about it is sufficient to make a
consumer skeptical enough to not believe
everything they read, regardless of who
wrote it or signed it.
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