Time will tell: future collectables

On July 10, Auctionata, the world’s only live online auction site, held its first real-time auction for vintage timepieces. This site has its headquarters in Vienna and provides a platform through which respected dealers can sell.

Highlights of the auction included a white gold Patek Philippe, which was auctioned by the Aaron Faber Gallery in New York, and a rare Jaeger-LeCoultre Triple from the 1930s, which was being offered by Paul Duggan from Boston.

It takes research and nerves of steel to pick up something collectable at auction, but what customers coming into your stores really want to know is what will be fetching reserves of £50,000 in 10 years’ time, because if people are going to put down £8,000 for a watch, they want to know it isn’t going to depreciate in value.

Investment items
Aurel Bacs, who heads up the watch department at Christie’s auction house, knows a thing or two about what makes a timepiece timeless. He was appointed international co-head of Christie’s watch department in July 2003 and has overseen many high-profile auctions, including its spring auction in Geneva, where a Rolex surpassed the $1.1m (£680,000) mark for the first time ever at auction, and a rare Patek Philippe, sold for $3.6m (£2.2m).

“If there was a safe recipe for picking something that would be a future investment, I would not be an auctioneer,” jokes Bacs. “There are too many things, such as trends and social rules, that change at short notice without any rationale.”

However, in the past 30 to 40 years Bacs has noticed that there are certain parameters that are valid, and he has five elements that can be applied to a watch for both the short and long term to assess its collectability.

“As with fine art, the maker’s name stands for something,” says Bacs. “If you have a perfect triple A name in horology it really helps.”

Bacs’s second point is technical complexity and quality.

“Something that is a handmade grande complication is important,” he says. “The human element in particular brings a level of quality and exclusivity to a piece.”

The third component is rarity. As Bacs explains, the auction market is just a reflection of a market and works by the same principles of supply and demand.

“The fewer of a particular timepiece there is the better it is for the value of it when it comes to be sold,” he says.

One of the other most important parameters is condition. As Bacs explains: “Vintage watches may fulfil criterion one to three but if they are in pieces and falling apart then it negates those criterion.”

The final element is provenance. Because the auction world is relatively close knit, people will know when an owner has shopped around a watch.

“If it has been offered to 10 other people but not sold, it immediately makes a person wonder what is wrong with the piece,” says Bacs. “This will affect its perceived value.”

When auctioning a watch, the perception of value is almost as important as the actual value.

Timothy Barber
Timothy Barber, a freelance writer whose specialist subjects are fine watches, luxury travel, dining and luxury living, explains why the Bremont P-51 is a star of the future

Nick and Giles English, the brothers behind the young, much admired watch brand Bremont, not only have an eye for extremely strong watch design, but a nose for a romantic narrative.

A couple of years ago the keen aviators launched the ultra-limited EP120 chronograph, a beautiful watch named after a famous Spitfire fighter plane - its unique twist was incorporating metal from the actual aircraft into its dial and movement. This year they created what you might call a US follow-up, the P-51 (below), named after the P-51 Mustang, the lead fighter plane for the US during the Second World War. Once again, aluminium from a famous surviving P-51 is used in the movement and to form the subdial. All of which might be so much gimmickry were not the watch, like its predecessor, such a beautifully constructed thing. Its look is inspired by the plane’s cockpit clock, the design detail extending to the propeller-shaped rotor in the caseback. Given that one or two EP120s have popped up on the secondary market already going at 20% to 25% above their original sale price, the collectability
of the P-51 would seem assured. The real long-term value may be in owning the pair - though with just 120 of the EP120s and 251 of the P51s made, that may be easier said than done.

Andrew Carrier
Andrew Carrier, aka The Prodigal Fool, explains why he doesn’t buy as an investment but gives his long-term view of some collectables

First things first: if you’re buying watches in order to make a profit, you’re wasting your time and money. I’m not suggesting that you cannot make money on watches - clearly, you can - but I just think you should buy what you like and what you’re going to wear. Anything less destroys the pleasure of watch ownership.

What will be collectable in the future, no one knows. We can only look to the past for guidance. Patek Philippe and rare Rolex watches (particularly the sports models, better still the rare transitional timepieces) have always provided good returns for buyers - helped by these brands’ strategies of annual price hikes.

If you want something off the beaten track, I’m inclined to take a long-term view. My best advice would be to find a new brand that is producing quality pieces, in small numbers, at reasonable prices and with a distinct and focused brand identity - brands such as MeisterSinger and Bremont.

I also believe Omega prices have a way to go. Its new models are still aggressively priced and I think are likely to be as collectable as Rolex in due course - think Speedmaster or Seamaster Planet Ocean.

James Gurney
James Gurney, editor of QP magazine and organiser of Salon QP, explains why he’s plumping for Patek

Working on the assumption that future collectors won’t be so different from ourselves, then my tip is one of two new for 2011 Patek Philippes. One part of their near-certain future value is that Patek is considered a safe-bet. If this sounds like a circular argument, it is, nevertheless Patek Philippes hold their value like no other brand, with only Rolex coming close and such perceptions, generally agreed upon, feed back into their price.

So assuming Patek Philippe manages its brand well and that no other thing happens, then Patek makes perfect sense for the collector, and should you want reassurance that Patek Philippe appreciates the trust collectors place in the brand, its marketing and comparatively conservative new collections should do the trick.

But for future values to increase, you need an x-factor, the watch should have some extra significance, whether that’s limited availability, provenance or association. Judging by the 20% premiums being paid two years after its launch and continued good prices at auction for Patek’s first ever in-house chronograph, the 5960, good value should be expected from the possibly even more important 5550P and 5235 (right) models. These are the first Patek Philippe models to be fitted with a complete silicon “assortment” (the combination of escapement,
balance and spring at the heart of a watch), a result of a programme
Patek Philippe invested in with acute foresight some 10 years ago.

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