Can Watches Be an Investment or Just a Timely Hobby?

Are Watches a Smart Investment or Just an Expensive Hobby?

If you want to know how to buy watches as investment, here is a straightforward summary before we go deeper into the nuances of the Australian market:

1. Focus on brands with strong resale history — Rolex, Patek Philippe, and Audemars Piguet lead the field.
2. Prioritise condition, originality, and full sets (box and original paperwork) over brand name alone.
3. Buy pre-owned where possible to avoid the initial depreciation hit of a new watch.
4. Choose discontinued or limited-production references for stronger appreciation potential.
5. Plan to hold for at least three to five years to ride out market fluctuations.
6. Buy from reputable, transparent dealers and verify every watch before purchasing.
7. Factor in ongoing costs like storage, insurance, and occasional servicing.

Luxury watches have long been symbols of personal achievement, but over the past decade they have quietly become something more — a tangible, wearable store of value sitting alongside property and shares in the portfolios of serious Australian investors. The secondary watch market is now worth an estimated $22 billion globally, and data from the Knight Frank Luxury Investment Index shows watches appreciated roughly 96% on average between 2013 and 2023. That is a figure that even the most conservative financial planners find hard to ignore.

In the Australian context, the appetite for high-end horology has surged. From the bustling business districts of Sydney and Melbourne to the growing collector communities in Perth, Australians are increasingly viewing their wrists as part of their broader wealth management strategy. However, not every watch gains value. The market is nuanced, and success depends heavily on which model you buy, when you buy it, and how well you look after it. For a detail-oriented buyer, that means doing the research upfront — understanding reference numbers, production volumes, and resale trends before spending a significant sum.

I'm Brad Purdy, founder of WristWorks, and my background spans mechanical work, sales, and finance — a combination that shapes how I approach the question of how to buy watches as investment every day. In this guide, I'll walk you through everything you need to make informed, confident decisions in the Australian pre-owned watch market. We will explore why certain brands command such high premiums, how to spot a piece with growth potential, and the most effective ways to eventually realise your gains when the time comes to sell. This is not just about owning a beautiful object; it is about understanding the mechanics of a global market that rewards patience, knowledge, and a keen eye for detail.

How to Buy Watches as Investment: A Guide to Alternative Assets

As we move through April 2026, the landscape for alternative assets has matured significantly. Investors are increasingly looking for "hard" assets that offer a hedge against inflation and low correlation with traditional stock markets. Luxury watches fit this profile perfectly because they combine mechanical artistry with extreme scarcity. Unlike digital assets, a mechanical watch is a physical masterpiece that requires no electricity and can be transported easily across borders.

The fundamental rule of What Defines A Good Investment Watch Today is a balance between brand prestige and market demand. While a gold bar sits in a safe, a watch provides utility and status while its value (ideally) climbs. Historically, rare luxury watches have shown an appreciation of roughly 12% over the last 30 years, often outperforming gold and silver during the same period. However, this isn't a "get rich quick" scheme; it is a strategic play that requires a Luxury Watch Investment Guide mindset.

Identifying High-Potential Brands and Models

When considering how to buy watches as investment, your first port of call should be the "Big Three": Rolex, Patek Philippe, and Audemars Piguet. These brands have decades of data showing consistent value retention and growth. For instance, top Rolex models have seen price increases for 67 consecutive years. The demand for the Rolex Daytona or the Patek Philippe Nautilus often far outstrips the supply, creating a permanent upward pressure on prices in the secondary market.

Beyond the giants, independent watchmakers are becoming the new frontier for those who specialise in niche markets. Brands like F.P. Journe and Vacheron Constantin offer lower production numbers, which can lead to explosive returns when a specific model catches the collector community's eye. F.P. Journe, for example, produces fewer than 1,000 units of certain models per year, creating a natural supply bottleneck that can lead to rapid appreciation once a model is discontinued.

For more specific insights on returns, you can explore How To Invest In Luxury Watches In 2025 (ROI, Tips & Best Watches) | The Luxury Playbook.

The Importance of Condition and Full Sets

In professional collecting, the watch itself is only part of the equation. A "full set" — meaning the original box, paperwork, hang tags, and even the original purchase receipt — can increase a watch's value by 10% to 30%. These documents act as a birth certificate, providing a clear chain of provenance that collectors crave. In the Australian market, where the community is tight-knit, having a complete history of the watch is a significant advantage when it comes time to sell.

Condition is equally vital. For modern watches, we generally find that professional polishing is acceptable to maintain a "like-new" appearance. However, for vintage pieces, the rules change completely. Collectors prize "unpolished" cases where the original factory lines are still sharp. Replacing a dial or bezel on a vintage Rolex can actually decrease its value significantly, as originality is the primary driver of price. To understand this further, read our take on Do Luxury Watches Hold Their Value.

Navigating the Secondary Market: How to Buy Watches as Investment

Buying brand new from an authorised dealer (AD) is the dream for many, but the reality involves years-long waitlists and "purchase history" requirements. This is why the secondary market has exploded into a $22 billion industry. By entering the pre-owned market, you gain immediate access to the pieces you want without the gatekeeping of traditional retail.

The primary benefit of buying pre-owned is avoiding the "showroom floor" depreciation. Much like a new car, many luxury watches (outside of the most hyped models) drop in value the moment you leave the store. By buying pre-owned, you let the first owner take that hit. Furthermore, as manufacturers raise their Recommended Retail Prices (MSRP) annually, the floor for pre-owned prices naturally rises, often pushing the Luxury Watch Resale Value above what you originally paid. Our deep dive Inside The Economy Of Second Hand Luxury Watches explains how these market cycles work in the Australian context.

Managing Your Portfolio and Maximising Returns

Once you have acquired a piece, your role shifts from buyer to custodian. If you are learning how to buy watches as investment, you must also learn how to protect that investment. This means more than just not dropping it; it involves climate-controlled storage to prevent moisture from affecting the dial and movement. In Australia's varied climate, ensuring your collection is kept in a stable environment is essential for long-term value retention.

While it is tempting to keep an investment watch "stickered" and unworn in a safe, many collectors choose to wear their pieces occasionally. If you do, wear it with care. Small "desk diving" scratches on a bracelet are expected, but deep gouges or cracked crystals will hurt your eventual exit price. We discuss these modern valuation metrics in The New Math Of Luxury Watch Value.

Understanding Risks and Market Fluctuations

It would be irresponsible to discuss watch investing without mentioning risk. The market saw a significant correction between 2022 and 2024. For example, the Patek Philippe Nautilus 5711, which peaked at astronomical heights, corrected down to a more "reasonable" level. This correction was a healthy reality check for the industry, moving away from "flipping" culture and back toward long-term collecting. Investors should favour models with a long history of stability rather than chasing short-term social media trends.

Liquidity is the other major risk. Unlike shares, which you can sell with a click, a high-end watch requires finding the right buyer. If you need cash tomorrow, you might have to accept a lower price. This is why we recommend a minimum holding period of three to seven years. The The Resale Boom That Turned Collectors Into Investors highlights how the market has shifted from a hobbyist niche to a serious financial arena.

Practical Steps on How to Buy Watches as Investment

To start your journey, we recommend a disciplined approach:

1. Identify Specific References: Don't just buy "a Rolex." Look for specific reference numbers (e.g., the 116500LN Daytona) that have a proven track record.
2. Use Research Tools: Monitor sites like WatchCharts or Chrono24 to see real-time price trends and global supply levels.
3. Check Service History: A mechanical watch is a machine. If it hasn't been serviced in 10 years, factor that cost into your purchase price. Always keep service receipts as they add to the provenance.
4. Verify the Seller: In Australia, look for dealers who are transparent about their stock and have a physical presence or a proven digital reputation in Perth or Western Australia.

For a comprehensive look at building value, refer to The Watch Investing Guide: How to Build Long-Term Value | Wealthica's Journey to $100B.

When to Sell and Realise Profits

Knowing when to exit is just as important as knowing when to buy. Many investors choose to sell when a model is discontinued, as the sudden end of supply often triggers a price jump. Others sell to rebalance their portfolio or to upgrade to a more prestigious reference.

When you are ready to sell, you generally have two paths:

• Outright Sale (Primary Recommendation): This is our primary recommendation at WristWorks. It is the fastest and most secure way to realise your gains. You get a firm offer, and once the watch is inspected, the transaction is finalised. This method removes the risk of market fluctuations while you wait for a buyer and provides immediate closure to your investment.
• Consignment (Secondary Option): This can be useful if you aren't in a rush and want to aim for a specific high price, but it is a secondary option because it takes longer and involves the watch sitting in the dealer's inventory until a buyer is found. You remain exposed to market risks during this period.

To prepare your watch for sale, ensure you have gathered the box, all spare links, and any service paperwork. A clean, well-documented watch will always command a premium in the Australian market. If you're ready to take the next step in your journey, you can explore our latest collection or learn more about the Australian market in our Luxury Watch Modern Guide. Whether you are looking to buy your first investment piece or sell a long-held asset, we are here to make the process transparent and straightforward.