Lab Grown Diamonds Resale Value: Do Lab Diamonds Hold Their Value

Lab Grown Diamonds Resale Value: Do Lab Diamonds Hold Their Value

For many decades, diamonds have been revered, but nowadays, there are a lot of environmental concerns surrounding the mining process. This has led to the development of lab grown diamonds, an alternative that has been created owing to technological advancements.

In recent times, the market for lab grown diamonds has been growing and receiving great acceptance from consumers and emerging as a captivating counterpart that offers similar shine and brilliance. But since lab grown diamonds are new entrants on the block, they are often surrounded by enormous misconceptions due to a lack of awareness.  

The most common one that bothers the consumers is the value retention of lab grown diamonds. As a result, it is believed that natural diamonds have a higher rarity and offer better resale value & buyback policy. Through this blog, let's explore the resale value of lab grown diamonds and determine if they hold their value over time in comparison to natural diamonds.

What are Lab Grown Diamonds?

lab grown diamond resale value

 

Lab grown diamonds are diamonds created in controlled laboratory environments that simulate the conditions present in the Earth's mantle, where natural diamonds form over millions of years. These diamonds retain the same physical, chemical, and optical properties as natural diamonds.

There are two methods to produce lab grown diamonds, namely, Chemical Vapour Deposition (CVD) and High Pressure-High Temperature (HPHT). In the CVD technique, a natural diamond seed is infused with gases under controlled temperature & pressure conditions, resulting in diamonds that are 100% carbon. The HPHT method, on the other hand, uses molten metal as a catalyst, which results in the resultant diamond having certain chemical impurities.

Why Are Lab Grown Diamonds Less Expensive Than Mined Diamonds?

According to a study by Frost & Sullivan, lab grown diamonds can be up to 40% more affordable than their mined counterparts. The reason for this considerable difference in cost is the efficient production method and the absence of expenses associated with mining.

Thanks to the latest technological advancements, lab grown diamonds have the same elegant beauty as natural diamonds but are much more affordable. This makes them perfect for individuals who want the same quality as natural diamonds at pocket-friendly prices.

Is There a Resale Value for Lab Grown Diamonds?

Lab diamonds do hold a resale value. However, the value of lab diamonds can vary depending on the seller. Some sellers also offer buyback programs promising to buy back jewellery at 50% to 80% of its original value. Brands like Limelight Diamonds which offer 80% buyback and 100% exchange can be real deal-sealers for consumers. With the market for lab diamonds continuously developing, it is possible that the demand for lab diamonds may increase in the future.

Factors That Influence the Resale Value of Lab Grown Diamonds

The resale value of any diamond, be it lab grown or mined, depends on several crucial factors. The factors that influence the resale value of lab grown diamonds are:

Quality and Grading

The quality and grading of lab grown diamonds are crucial in determining their resale value. Diamonds graded with high colour, clarity, and cut ratings will likely steer better prices in the resale market.

Market Acceptance

The growing popularity and consumer acceptance of lab grown diamonds are essential for their resale value. As lab grown diamonds become more recognised and sought-after, their resale value is likely to improve.

Brand Reputation

Lab grown diamonds from reputable and established brands may hold higher resale value due to consumer trust and recognition.

Demand and Supply

The market's balance between demand and supply also affects the resale value. If the demand for lab grown diamonds outpaces the supply, their resale value may increase.

If you're planning to buy lab grown diamonds for resale, it's important to do your research and understand the advantages of sustainable diamonds. It's also helpful to assess the current demand and market trends for lab grown diamonds to make an informed decision.

How to Get the Best Resale Value for Lab Grown Diamonds:

To maximise the resale value of your lab grown diamond, consider the following tips:

Certificates and Documentation

Ensure your lab grown diamond is certified by renowned gemological institutes like SGL, GIA, or IGI. These certificates provide crucial information about the diamond's quality and authenticity, providing confidence to potential buyers.

Proper Storage and Care

Securely store your lab grown diamond in a jewellery box or pouch when unused. Regular cleaning and maintenance will preserve its brilliance and appeal, enhancing its resale value.

Timing the Sale

Consider market trends and timing when selling your lab grown diamond. If the demand for lab grown diamonds rises, you can anticipate a higher resale value for your diamond.

What is the Average Resale Value of a 1-Carat Lab Grown Diamond?

While the resale value of lab grown diamonds varies based on various factors, the Gemological Institute of America (GIA) data indicates that a 1-carat lab grown diamond can retain around 50-70% of its original purchase price upon resale. This range fluctuates based on market conditions, diamond quality, and other external factors.

Are Lab Grown Diamonds in Demand?

Lab grown diamonds are rapidly climbing the popularity ladder as consumers are inclining toward ethical and sustainable products. According to a report by McKinsey & Company, the global market for lab grown diamonds has grown at an annual rate of 15-20% in recent years.

Consumers are increasingly becoming aware of the environmental impact of traditional diamond mining and are turning to lab grown diamonds as a more eco-friendly and ethical choice. According to a survey conducted by MVI Marketing, a clear majority of 66% of millennials are willing to consider buying lab grown diamonds.

The market for lab grown diamonds is not limited to specific regions. The US, India and China are among the top markets for these diamonds, with the US being the largest consumer market.

As the demand for lab grown diamonds increases, more manufacturers and retailers enter the market, increasing competition. This also means there are more choices to evaluate when purchasing.

The demand for lab grown diamonds is expected to remain strong, making them a compelling choice for conscious consumers. However, like any investment, the long-term value of lab grown diamonds is influenced by various factors, making thorough research and informed decision-making essential for potential buyers and sellers.

Conclusion

Lab grown diamonds have undoubtedly emerged as a viable and attractive alternative to mined diamonds, providing the same sparkle at a more affordable price. As a result, definitely, one can sell lab grown diamonds and get the equivalent resale value compared to natural diamonds.

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