When is the best time to buy a diamond? Diamond prices Up 2.2 – 8.8% 1st Quarter 2014

You’re welcome to try to predict when is the best time to buy a diamond, however it is likely that any time spent trying to figure that out is simply going to cost you in terms of carat weight, color, or clarity, as diamond prices continue to steadily increase. Rapaport Diamond News is reporting steady price increases for diamonds throughout the first quarter of 2014, with the price of one carat diamonds increasing 2.3% throughout that period.

The relative prices of third carat diamonds increased 8.8% during the first quarter of 2014, while the price of half carat diamonds increased 6.6% and the price of three carat diamonds went up 2.2% on average… and it doesn’t seem that things are going to get any better since De Beers raised the price of diamond rough 3-4% at the diamond rough sight sale which was held at the beginning of April, which means that all indications are that diamond prices are going to continue to increase for the 2nd quarter of 2014.

What does this mean for your diamond buying budget?

It might not mean anything if you happen to have a diamond lined up in your sites and you pull the trigger quickly, as it can often take anywhere from a few days to a week or two for online diamond dealers to adjust the price of diamonds in their inventory to reflect increases in diamond prices.

A few diamond dealers who hold exclusive inventory, like Brian Gavin and Crafted by Infinity [distributed via High Performance Diamonds] might even try to maintain the current price of diamonds which they’ve already purchased in order to gain a slight competitive edge… I’m not  saying that they will, but it’s what I used to do when we held physical inventory, because it gave us a slight advantage over competitors who were operating from virtual inventory provided by the diamond cutters, because virtual inventory is far more likely to reflect price increases faster since it is electronically tied into the pricing indexes.

Be advised that in my experience, any new production from Brian Gavin, Crafted by Infinity, and every other diamond cutter, will definitely reflect the current price of diamonds, because it is being produced from diamond rough which was purchased at the new higher prices.

Why do diamond dealers increase the price of existing diamonds?

You might be wondering why diamond dealers tend to increase the price of diamonds which are already in their inventory, the assumption is that it’s greed… however in my experience it is an attempt to ensure that they will be able to maintain the same volume of inventory in the future, because as each diamond sells, it must be replaced with another… and with diamond prices on the rise, that means that the replacement diamond will cost more than the diamond being sold.

But there is also a benefit to trying to maintain the price of current inventory, as a competitive edge against diamond dealers who are working off of virtual inventory… however this approach tends to only pay off in the short term, perhaps for the first few weeks after an increase takes place, then most dealers will have no choice but to raise prices to cover the cost of new production, as two or three price increases are reflected in the marketplace.

About the Author Todd Gray

Todd Gray is a professional diamond buyer with 30+ years of trade experience. He loves to teach people how to buy diamonds that exhibit incredible light performance! In addition to writing for Nice Ice, Todd "ghost writes" blogs and educational content for other diamond sites. When Todd isn't chained to a desk, or consulting for the trade, he enjoys Freediving! (that's like scuba diving, but without air tanks)

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