Buying a watch at auction
This is the first article about watches I ever wrote for the Wall Street Journal. It appeared in January 2003. The topic is buying a watch at auction. The prices at the time seem like bargains fourteen years later and they were.
Maybe the family legend isn’t true and my father didn’t win the 18-karat gold Vacheron Constantin wristwatch in a card game in 1948.
I don’t mind. I wear the watch each day, it keeps perfect time and I like the way its round face looks on my wrist.
So, why not buy another Vacheron from the 1940s, maybe a rectangular one?
Fortunately, I live in London, home to several respected vintage watch dealers. Unfortunately, dealers charge from £4,000 to £12,000 and beyond for vintage Vacherons, which is more than I want to spend.
Why do people who value watches want one made by Vacheron Constantin or Patek Philippe? Lineage is part of the attraction.
In 2005, Vacheron Constantin will celebrate the 250th anniversary of its founding by Geneva entrepreneur and master watchmaker Jean-Marc Vacheron. Antoine Norbert de Patek, an exiled Polish patriot living in Switzerland, in 1839 founded the company that became Patek Philippe.
Another is exclusivity. Vacheron Constantin today produces between 15,000 and 16,000 watches annually. Patek Philippe says it makes about 30,000 watches each year. Rolex, the watch megabrand, says it produces about 700,000 watches. Timex, the mass maker of watches, produces between 20 and 30 million watches annually.
Both companies can boast of having adorned many illustrious wrists and, in an earlier age, sat in many famous pockets. Queen Victoria, the Russian composer Tchaikovsky, American jazzman Duke Ellington and scientists Marie Curie and Albert Einstein all owned Patek Philippe watches.
The company does not discuss current customers, but recently guitar legend Eric Clapton admitted wearing a Patek Philippe.
In 1955, when four world leaders, Dwight Eisenhower of the United States, Anthony Eden of the United Kingdom, Edgar Faure of France and Nikolai Bulganin of the Soviet Union, met at a summit in Geneva, prominent citizens (let’s face it, if anybody knows about watches, it’s the people of Geneva) presented each man with a Vacheron Constantin.
I didn’t want to buy a vintage watch off the Internet without first seeing it on my wrist. I discovered that auction houses put their catalogues on-line, complete with images, prices paid at past auctions and estimates for future auctions. Prices were about half what dealers charged. Could I buy a watch at an auction? A search of the catalogues revealed Lot 195 in a Nov. 26 Christie’s auction of “Important Watches” – a 14-karat rectangular Vacheron Constantin from 1945. Estimated price: £1,000 to £1,200. ($1,500 – $1,800)
When the catalogue arrived, with a hard copy image of the watch in my hands, I felt the first twinges of that urge to own. I phoned Christie’s and spoke to Richard Chadwick, head of watches for the auction house in London. We arrange a pre-auction viewing.
Auction houses are not museums. You are encouraged to examine any item you’d like to own. At the watch viewing, people try on watches and even open them to have a look inside. The watch I wanted kept good time and sat handsomely on my wrist.
Mr. Chadwick explained that wristwatches became popular during World War I.
In the trenches, with mud, rats and enemy fire, it was easier to look at your wrist than fumble for a pocket watch. The vintage era stretches from that time until 1970, when quartz watches appeared.
“What matters in vintage watches is who made it, when it was made and to a lesser extent the materials used,” Mr. Chadwick said. “Patek Philippe is regarded as the best but watch aficionados appreciate Vacheron Constantin. Vintage watches are very subjective. It comes down to whether or not you like it.”
When asked why auction prices are lower than prices charged by a vintage watch dealer, Mr. Chadwick pointed out that dealers often restore watches before selling them and need to recoup that investment. At auctions, watches are sold “as is,” although watch experts advise bidders on how much restoration a particular watch may need.
He told me that the dial of the watch I was interested in had been refinished, not unusual for a watch that is almost 60 years old, but that it was in good condition.
As for how much to bid, Mr. Chadwick said the watch had admirers and might fetch £2,000 ($3,000). He suggests a limit near that figure. My limit also needs to include the buyer’s premium – a charge on the final price paid by the buyer to the auction house and set at 19.5% on items under £70,000 ($105,000).
In the U.K., vintage watches do not incur VAT, but it is charged on the buyer’s premium, at 17.5%.
I decide my limit is £1,500. Considering the buyer’s premium and VAT, I must stop bidding at £1,200 ($1,800).
I was bidding in person, so I registered with Christie’s on the day of the auction. Registration requires two forms of identification and completion of a document confirming my name, address, and bank details. In return, I was given a paddle – a large card with a number on it. Mine is 482. Auctioneers do not accept bids from anyone without a paddle number.
Bidding began at 10:30 a.m. Eighty-five lots an hour were sold, so for about two hours, I relaxed and enjoyed the drama of an auction.
An image of each lot flashes onto a massive monitor at the front of the room, near the auctioneer’s podium. Two other monitors display the amount being bid in several currencies simultaneously. His voice amplified by four speakers, the auctioneer rhythmically works though the lots. He begins with a brief description, then a rapid-fire rise in the price until his gavel descends and he declares an item sold.
When phone bidders come into play, usually on the higher priced watches, the rhythm slows but the tension increases and people lean forward in their seats.
As the selling of Lot 195 approached, my palms began to sweat. I became anxious and considered backing out. Who needs another watch, I thought. You can only wear one.
Then I heard the auctioneer Ben Wright, Christie’s International Director of Clocks and Watches, call for bids of £500 ($750) on Lot 195.
Another bidder lifted his paddle, and Mr. Wright declared: “500 bid. Any bids at 550?” Up went my paddle immediately, Mr. Wright acknowledged me and asked, “Am I bid 600 now?” I am. “Am I bid 650?” Trying to appear cool, I nodded my head.
When Mr. Wright hit £1,000, I heard the whack of his gavel and his voice. “Sold to paddle number 482, for £1,000.” In other words, me. Bidding lasted about eight seconds.
I felt elated and a little smug, as my winning bid was at the low end of the estimate. I also stayed within my limit. Final prices, plus buyer’s premium, VAT and the catalogue totalled £1,246.13 ($1,869).
Top price that day for a vintage watch was £37,000 ($55,000) for a 1940s Patek Philippe.
After the auction, I went downstairs to the cashier’s desk, paid my bill and collected my watch.
Buying at auction comes with an important caveat: Keep your cool and be ready to deal with disappointment if someone outbids you.
As for me, I’m sure I’ll do it again. After all, I never learned to play cards as well as my father.
After the sale, I discovered a few interesting facts about the watch. The case is 14 carat gold marked 14k in the American fashion. Why 14k on a Swiss made watch? During WW2 when the watch was made the US banned imports of gold from Europe. Swiss watch brands exported watch movements, crystals and dials to the US. The brands produced a gold case to house the movement in the USA – hence the k for carat on my watch. Some people have speculated that my watch and others were assembled on 5th Avenue were many Swiss watch brands had offices.