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expensive coins and resale
steveben
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i am interested to know if anyone has any research or thoughts on market demand for coins as they get more expensive. i imagine the market for a $125K coin is substantially different than one that is $10K, and the market for a $5K coin is different than a $1K coin, and so on...but i am wondering:
what are the key price points where market demand really changes?
how hard is it to sell a coin that is higher than $10K after you have purchased one and held it for a while?
i am contemplating the purchase of a $22K coin, but i am concerned about whether or not the resale of that coin in the future is going to be difficult just because of the price point (assuming the coin isn't a problem coin and one that most collector's would love to have).
perhaps there are some books that have research on this subject? any thoughts or advice is much appreciated.
what are the key price points where market demand really changes?
how hard is it to sell a coin that is higher than $10K after you have purchased one and held it for a while?
i am contemplating the purchase of a $22K coin, but i am concerned about whether or not the resale of that coin in the future is going to be difficult just because of the price point (assuming the coin isn't a problem coin and one that most collector's would love to have).
perhaps there are some books that have research on this subject? any thoughts or advice is much appreciated.
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Anything beyond this inflection point is handled completely different by the cabal of high end dealers.
Please visit my website Millcitynumismatics.com
<< <i>The exact price point is $17,642.84
Anything beyond this inflection point is handled completely different by the cabal of high end dealers.
haha, very funny.
seriously though...you have to admit there are less people in the market for a ferrari than a hyundai. there must be some data demand relative to the price points.
@crypto79 you are kinda backing up what i am implying with my question in that you point to the saint as a "blue chip" collectable. so in other words not all 22K coins are as collectable. but certainly you aren't saying that if you buy a 22K coin you should not count on getting any money for it back. it's just a disposable purchase. is that really the case?
Buy coins you can enjoy regardless of price change.
<< <i>okay, let's use saint gaudens as an example. i bet a lot more saints sell in the 2-4K price range than those that are higher...even thought the desirability maybe there, people may not be able to reach the price point. is there any type of research on this? or does it simply come down to how desirable the coin is? i don't think so because anyone who collects saints would certainly love to have a high quality high relief, but they can't afford it.
@crypto79 you are kinda backing up what i am implying with my question in that you point to the saint as a "blue chip" collectable. so in other words not all 22K coins are as collectable. but certainly you aren't saying that if you buy a 22K coin you should not count on getting any money for it back. it's just a disposable purchase. is that really the case? >>
It is unlikely to be a $22K loss, but it is possible that you may have to take less than $22K if you need to sell on short notice. Do you know if it is in a relatively popular series? Perhaps you should try offering it at $24K to see how much interest it generates.
<< <i>I agree with crypto79, if you are so concerned with this money, you should not buy the coin.
Buy coins you can enjoy regardless of price change. >>
this may well be the rule of thumb to live by...and i do understand, appreciate, and subscribe to this point of view.
however, there must be some answer to how the market demand shakes out based on price points. there's lots of coins valued at nosebleed levels in the red book...but how often do these sales take place compared to different price levels? how much more of a risk factor is the price point as it goes up? that's really all i am curious about. maybe i am failing to explain my question adequately...or perhaps it's no different that other collectable markets. the demand decreases as the amount of people that fit into that demographic shrinks.
these coins we buy aren't ours to keep, they're only ours for a while. (paraphrasing neil young)
My main experience with selling big coins was as a dealer. In those cases, the biggest concern for me was to know if a guy I didn't know was passing good checks. I only had four bounced checks in 10+ years of dealing. Three of those were from one collector who ended up on my "cash only" list, and one was from a dealer, who made good immediately.
If it's priced right selling big coins (for me up to $30,000) is not a problem, at least it was wasn't when I was a dealer. I sold a few pieces for up to $75,000, but in those cases I more of an agent or salesman than a dealer. I started in business in the mid 1990s when the coin market was "dead" and retired when it was sort of "dead" in Florida. Between then I enjoyed a nice boom period and some more even times. Like I said, if you have quality coins, fairly priced, selling big ones is not a major problem.
To be honest I more trouble selling low grade, cheap stuff, which is why I avoided stocking it.
<< <i>
<< <i>The exact price point is $17,642.84
Anything beyond this inflection point is handled completely different by the cabal of high end dealers.
haha, very funny.
seriously though...you have to admit there are less people in the market for a ferrari than a hyundai. there must be some data demand relative to the price points. >>
people that can really afford ferraris (versus those that lease them for a bit of a show) can sneeze and buy a hyundai. The market ticks are hyundais to them.
I don't think they see price points in the $22k range the same as the 99% (
Also, the coins in the upper price range are likewise fewer just like the number of people who buy in the upper price range.
Furthermore, the high end coins just seem to keep getting more high end.
(e.g. Legend doesn't have issues moving high end coins.)
So, your question asking about price points and worrying about the number of buyers just doesn't seem to pan out from the get go.
It seems to me from the post... if you have to ask, then you can't afford it might apply. Can you afford it? Is the price right for it??? Is it eye candy?
<< <i>
So, your question asking about price points and worrying about the number of buyers just doesn't seem to pan out from the get go.
It seems to me from the post... if you have to ask, then you can't afford it might apply. Can you afford it? Is the price right for it??? Is it eye candy? >>
fair enough. i didn't *have* to ask...i was just trying to learn more about how the coin market works. so, it seems to be just like any other based on your response.
high end coins move.
<< <i>
It seems to me from the post... if you have to ask, then you can't afford it might apply. Can you afford it? Is the price right for it??? Is it eye candy? >>
I think it's a prudent question to ask when making a purchase that size, regardless of one's financial situation.
<< <i>While more people can afford a $100 coin more than a $22,000 coin, the concept of price points applies more to who the potential buyers are than for the coins they buy. A high pop common coin might be very expensive but very few people are going to be interested at that price. People looking for a chain cent or 1893-S Morgan dollar expect to pay big money and $22K might be a steal. If the coin regularly sells for $20K+ then you'll have people who want to buy it when you're ready to sell. If you paid top dollar for a condition rarity I would expect it would be harder to sell or at least you'd have to find one of those rare individuals who want what you wanted. The current good news is that high end coins (which this would be for me) have a market among the well-heeled if they are nice. A lot of the buyers of $100 coins are not buying coins at all due to the economy. If I'm off base on this thinking I'm positive someone will set me straight. Good luck. >>
Well said, and I agree. Is your 22k a kick butt piece, or just an example? A lot of factors come in to play, but you stand a better chance if your piece is "mainstream," and has "fizzazz."
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
a pricey coin may not move no matter who sells it.... well, at least not at the price you'd hope for.
but if it has fizzazz, it can be consigned and moved....
Heritage could handle it if no one else.
and undetectable to you, that could be a $5K down the road. One advantage to the Bechtler is that we are in a gold bull market. And even though the bullion value of
this piece is insignificant, the fact that it's gold could draw in some new blood previously more into bullion. I wouldn't expect the Bechtler market to heat up any time soon.
So your downside on the piece if properly graded and decent for the grade is probably 10-15%...a typical dealer markup or auction commish. For a $22K purchase I'd want at
least another gold expert's opinion or a sticker on the coin. If you know your territorial gold and the piece is a sleeper compared to others in this price range, $22K could be a rip.
If you're buying this from a dealer who routinely stocks territorials, your chances of getting a "rip" drop pretty close to zero %. Fwiw a friend of mine handled a raw $5 Bech.
about 3-4 yrs ago that walked into a local shop. It ended up slabbing out at AU55. He sort of figured it was worth around low 20's. A call to Heritage resulted in an over the phone
offer of $20K just based on it being holdered and a fresh coin to the hobby. The owner had no clue what it was worth. Other dealers that had seen the coin thought it was fake and
were giving low ball offers. Ironic that my friend didn't even get reimbursed his time and slabbing fees on the coin as the owner disappeared with the coin once he got it back. No
good deed goes unpunished.
Seeing this is a Bechtler and not a PF67-68 Morgan dollar the market is fairly stable and not quite as subject to short term major price swings. You should have no problem researching
previous sales of similar coins on Heritage Auction Archives or Stacks Bowers to get an idea of what they've been bringing at auction. I would imagine that so-so quality territorials
are sitting in inventories just like everything else. At $22K I'd want some pop for money (ie a coin that was strong for the grade and eye-appealing).
roadrunner
120 coins were listed between 10000-36000, of those 2.50% were sold.
135 coins were listed between 5000-9999, of those 7.41% were sold.
150 coins were listed between 3500-4999, of those 17.33% were sold.
116 coins were listed between 2999-3499, of those 28.45% were sold.
156 coins were listed between 2700-2998, of those 8.33% were sold.
145 coins were listed between 2400-2699, of those 11.03% were sold.
160 coins were listed between 2250-2399, of those 17.50% were sold.
148 coins were listed between 2100-2249, of those 23.65% were sold.
105 coins were listed between 1999-2099, of those 34.29% were sold.
obviously lots of other factors are not being accounted for here, like whether or not some coins were listed at unrealistic prices, rarity, the seller, etc. there are many factors that i am ignoring. i know that. but, i am looking for price trends. it appears to me that the saint market appears to be segmented between two camps...those between 3000 and 5000 are pretty strong and those between 1999 and 2250. the other price points have lower than average sales numbers. what conclusions can be drawn from this? it's interesting, no?
this is the kind of information i was hoping to get insight into...not whether or not i should buy a particular coin. i just wanted to know how much more price is a factor in the resale of a coin...despite all other factors that we already talk about like condition, rarity, eye appeal, popularity, etc. price points do make a difference.
i think that coinbuf has the best response, which is somewhat backed up by this data:
"as the price goes up the buyer pool shrinks and you encounter a more fussy buyer in general."
perhaps that is obvious to most, but was it obvious that there are two different trends in the saint market?
On the lower end things are more rational, market is more efficient.
In honor of the memory of Cpl. Michael E. Thompson
Also, whatever type of coin you buy, keep in mind that the price you pay will matter. If you overpay, you're going to think resale sucks when the time comes. If you rip the coin, you will be impressed with the resale market.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>Comparing ebay data for bullion-related double eagles vs. the prospect of buying an esoteric territorial gold coin is foolish. Forget that approach and simply study the piece in question. >>
again, i'm using the ebay saint market as an example of what i am trying to find out...not as decision criteria for whether or not i should buy this particular coin.
in fact, this thread was never about whether or not i should buy a particular coin. i blame myself for creating that misunderstanding because many have taken it that way. the thread is about how much price is a factor in the resale market for coins and what the trends are. i can see that what i am looking for is just not out there and that it's something i'll have to research on my own.
my decision on whether or not to buy this particular coin got me thinking about this...that's the only reason i mentioned it.
i think my data gathering on ebay reveals there is a saint bullion market at 1999-2250 (within the last 90 days) and a collector market at 3250-5000, btw.
reading the dicussion. Thanks to all !!!
I think there is always a market for the top few pieces.
Quality Quality Quality
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"Sou Mangueira......."
many of those are dealer or even housed owned coins with strong reserves. That's why many are just bought back and tried again or tried elsewhere. The lower priced coins
are often sent to auction to sell, not to be bought back. The commission and buy back structure tends to support that. But frankly, one is probably not thinking very clearly if
they are sending $2,000-$3,000 $20's to auction at a 10-15% commish (45-90 days to be paid) when they can usually be sold outright for 5-10% with immediate payment.
I'll put a stab on the original question and state that the $20K range is probably a more risky venture than coins in the under $15K range and $30-$50K range. The big buyers want
high powered expensive coins, the higher the price the better (assuming quality, rarity, and demand are there). But it's tough to find honest to goodness rarities at the $20K range
if one is looking at classic gold coins. It's sort of too cheap for the deep pocket boys and way too expensive for 99% of collectors.
roadrunner
<< <i>The lower priced saints in this example are probably being sent to market with low to minimal reserves. More of them are owned by collectors. On the $10K and up range
many of those are dealer or even housed owned coins with strong reserves. That's why many are just bought back and tried again or tried elsewhere. The lower priced coins
are often sent to auction to sell, not to be bought back. The commission and buy back structure tends to support that. But frankly, one is probably not thinking very clearly if
they are sending $2,000-$3,000 $20's to auction at a 10-15% commish (45-90 days to be paid) when they can usually be sold outright for 5-10% with immediate payment.
I'll put a stab on the original question and state that the $20K range is probably a more risky venture than coins in the under $15K range and $30-$50K range. The big buyers want
high powered expensive coins, the higher the price the better (assuming quality, rarity, and demand are there). But it's tough to find honest to goodness rarities at the $20K range
if one is looking at classic gold coins. It's sort of too cheap for the deep pocket boys and way too expensive for 99% of collectors.
roadrunner >>
Interesting perspective
But there are a few more things you might consider:
Do you know the coin type and series?
How long do you expect to keep the coin before resale? (Be honest with yourself here - do you have a savings to cover life's challenges or would you be forced to sell the coin if something happened?)
Does the person you are buying it from have a good reputation in the industry, and is that person known for handling nice coins?
Have you bought coins from this person before? Have you sold any coins back to this person? How are they when it comes to buying back a coin?
In a transaction at this level, the seller is almost as important as the coin.
Is the coin certified by PCGS or NGC? Does it have a CAC sticker? What generation holder is it in?
Do you have any coins to trade for the coin you want? Will the seller give you good trade-in value for those? Even if you take a loss on paper with the trade-ins, this may still make it easier for you to shell out the remaining cash for the coin.
This list could go on...but again, I try to keep these decisions simple.
<< <i>The exact price point is $17,642.84
Anything beyond this inflection point is handled completely different by the cabal of high end dealers.
I haven't had a chance to read the whole thread.
HOwever, I can speak from experience.
The best advice I can offer is be prepared to sit on it for a while, and make sure the coin you buy is THE ONE you want in the THE SERIES you want to collect.
I made the mistake of buying some key dates, and then changed collecting interest, and had to take a minor loss on them.
Also, it was also eye-opening when trying to sell the coins. As you know, there are myriad ways to sell (ebay, consign etc.) and finding the right venue can be challenging.
I remember reading on someone else's thread to try selling a few coins, or always be selling something, to maintain a familiarity with how hot/cold the market is and how easy/hard it is to move a coin.
My two cents.
however, certain very rare very thinly traded coins will either set records due to bidding wars when they do appear or fly off dealers' web sites as soon as they're listed (if they even make it past the want lists of "preferred clients")
which is which really depends on the specific pieces and the context when theyre offered for sale
Liberty: Parent of Science & Industry
<< <i>The exact price point is $17,642.84
Anything beyond this inflection point is handled completely different by the cabal of high end dealers.
Does that include buyer's premium? I gotta know!