Myths and Truths About Appraisals
What Is an Appraisal?
Most people are led to believe that an appraisal is a statement by a professional or expert that gives the accurate description and value of the item being appraised.
This is partially true. An appraisal is supposed to accurately give the description and value of the item (Market Value).
However, what an appraisal most frequently does (rather than validate the item’s actual value) is validate the over-priced inventory of the jeweler (or other merchant) who wrote the appraisal, giving a false sense of value to the item and to the inventory in the Jewelry Store.
The truth with most appraisals is that they are written by people who over-price their items already and thus they are over-pricing your item.
The best way to test an appraisal is to ask the jeweler what they would purchase the item for … today!
SERIOUSLY, ask them !!!!
We have found that on a $1000 appraisal the jeweler will typically pay 8-15% of the appraisal for the item.
If the item is appraised at $1000, then why would they only pay $80-$150 for it? That would go to say that, leaving a fair profit margin, the item actually has a REAL market value of only $100 to $180.
So, why the large appraisal?
One simple reason … to increase profit on current items for sale in their stores.
Not to validate “your” item’s value, but to validate “their” items’ values or overvalued prices!
It is, in short, nothing more than a scam.
They are simply trying to justify their overpriced inventory and validate why they charge so MUCH for their items.
Summary:
An appraisal is a piece of paper stating the HIGHEST POSSIBLE retail price that one would expect to pay in the highest market – and in no way represents an actual MARKET VALUE for the item.
It is intended to do nothing more than justify the merchant’s exorbitant prices of their current items for sale.