Rolex’s Secondary Market Performance in the First Half of 2023
Rolex prices have stabilized during the first half of 2023, and discontinued Daytonas continue to drop in price. However, there may be something new for the second half of the year
As anticipated in last week’s Patek Philippe analysis article, this Friday we analyze the secondary market of Rolex.
The benchmark index for observing the brand's macro performance is the Rolex35, which brings together the 35 most influential Rolex models in the market.
For its calculation, which is suitable for understanding its evolution, first of all the three fundamental models are included: Daytona, Submariner and GMT, which are currently among the most traded within the second-hand market and are present in the index with many references. Then there are the Sky-Dweller and Yacht-Master models, and there are also models such as Day-Date, Datejust and Oyster Perpetual.
To obtain the index, a weighted average is performed between the market prices of these models so that a complete view of Rolex models and how they are performing as a whole can be obtained. The graph shows the performance of the index over the past three years.
It seems that the market frenzy has ended and in the last six months everything has stabilized at figures that are still higher than pre-2020. The period of growth has generated a new awareness of how Rolex is perceived. A belief has crept in among people that this brand's watches are almost always worth more than the list price. This could be the key to explaining why the downturn phase has not completely cancelled out all the increase generated in recent years.
Let’s now analyze the most important and most traded model on the market: the Daytona.
The first months into 2023 brought big news for the Daytona. This year the iconic collection turns 60 years old, and for the occasion during Watches&Wonders, Rolex revisited the entire line by proposing a new updated caliber and making some minor design changes.
But what we are most interested in here is first of all to analyze how the older models have moved in the market since they were taken out of production in April 2023 until today.
To assess the Daytona market in this case, we have to make a distinction between the "primary" models, the flagship references (Panda, Reverse Panda, Platinum, and John Mayer) and the "secondary" models.
In analyzing the primary models, we noticed that before Watches&Wonders there was an interesting surge in transaction values due to rumors about new references that Rolex would introduce for its 60th anniversary. Many expected that these references would be withdrawn from production, and because of this, the price began to rise. With this rise, many sellers tried to take advantage of the trend and put more and more watches on the market in an attempt to sell them at bargain prices. This explains the downward trend after the rise. The sharp increase in supply has brought prices back to lower levels, which is why there has been a slight decline in the last months compared to March. In any case, the exit from production of these references has enshrined a bullish trend for them, as seen in the John Mayer model and the Daytona in black steel.
The trend of the John Mayer is an evidence to how rumors are influential in the watch market. Many expected that this reference would be withdrawn from production, which is why the price started to rise well before its official release. As can be seen from the graph, after a period of decline, the price between January and April 2023 increased by 15.6%. The market, well before Rolex's official announcement, had incorporated this item.
Models such as Ref.116500LN saw an initial increase that then flattened out at around €31,000. The curve for Ref.116506 is even more severe, with an increase and decrease in value of about €4,000 over three months.
For the secondary models, as was to be expected, the impact was softer, as they increased in price, but only slightly.
When a model is discontinued very often its value skyrockets, this phenomenon has happened many times especially with Rolex, just think of the Hulk.
However, with the Daytona we are seeing a continued decline despite the fact that they have gone out of production, an important indication of how much the market has changed in recent years.
Another reason is that the new Daytona collection has an almost identical replacement, meaning that collectors who want one do not yet have to turn to the second hand market necessarily.
The year of the Daytona is not over, however, and a few weeks ago Rolex surprised everyone with a brand new Daytona made for the centenary of the 24 Hours of Le Mans, the historic endurance car race. What has all fans jolted is the presence of an inverted panda dial in the style of Paul Newman's Rolex, a clear reference to the Daytona 6263 of a time among the most iconic ever.
This return to its heritage is an unexpected move but it was also what so many enthusiasts were hoping for. Needless to say, this model is a special edition, and if we combine this feature with the strong Paul Newman reference, we get the perfect mix so that over the years its price on the secondary market can register a very important growth.
Another model that could make a lot of buzz in the coming months is the new Oyster Perpetual "Celebration" dial.
Another strategy Rolex has been implementing in recent years concerns the colorations of the Oyster Perpetuals. Introduced in 2020, the new line had created a lot of hype both because of the maison's bold choice and because of the tremendous growth these models experienced shortly after their official launch. In the latest edition of Watches & Wonders, Rolex wanted to keep the focus on this collection at an all time high by presenting a new model with a "celebration" motif inside which are the colors of the Oyster watches presented a few years ago.
In conclusion, if we look at the brand as a whole the general situation in the secondary market shows a phase of price stabilization.
Most Rolexes, while remaining available on the market at values well above their price lists, no longer offer increasing returns as was until last year. However, there are some exceptions such as the Daytona "Le Mans" or the new Oyster Perpetual, which have been capturing the market's attention in recent months and would certainly be an interesting topic in the future.
