Thinking about investing in a lab grown diamond? You might be wondering if it’s a smart investment. It’s a reasonable thing to consider since lab grown diamonds are still a costly piece of jewelry.
While lab grown diamonds are beautiful pieces that come with a lower price point, that doesn't always correlate with their resale value. In this guide, we’re telling you everything you need to know about the value of lab grown diamonds so you can decide if it’s the right investment for you.
Are Lab Diamonds a Good Financial Investment?
Answering the question whether lab grown diamonds are a good investment or not depends on how you look at the question. Financially speaking, if you wanted to sell your jewelry in the future, then no, lab diamonds wouldn’t be a good investment. That’s because they have a lower resale value than natural diamonds do.
But, if you’re looking to invest in your personal jewelry collection with affordable pieces, then yes, lab diamonds are a good investment! Lab diamonds contain the same properties as natural diamonds, making them just as real. This means you can have real diamond jewelry to wear and pass down as family heirlooms for a lesser cost than natural diamond jewelry.
Understanding Resale Value: Lab Grown vs. Natural Diamonds
Some people don’t plan to keep every piece of jewelry, especially when they have high-end pieces. Whether you’re needing to sell an old ring or necklace, the type of stone it showcases plays a factor in how much you get back.
Let’s look into the resale value of lab grown diamonds versus natural diamonds to see which one protects you in the long run.
Why Do Natural Diamonds Have a Higher Resale Value?
We’ve already said that lab grown diamonds do not have resale value as high as natural diamonds. Natural diamonds are considered to be more rare and valuable since they’re sourced from the earth, and take years and years to form.
It takes a lot of time, money, and resources to find natural diamonds. That’s not the case with lab diamonds, so they’re able to be made quicker and indefinitely. This is what makes them not as rare and lowers their resale value.
What is the Current Resale Market for Lab Diamonds?
Have a lab diamond you’re looking to sell? Good news: turns out, the demand for lab diamonds has increased over the last decade, but resale value still tends to be low. Man-made diamonds are already priced between 30%-70% lower than natural diamonds. When they’re being sold secondhand, the price drops even lower. When you sell a lab grown diamond secondhand, they’re usually sold from 10%-30% of the original retail cost.
The "Emotional ROI": Redefining Your Diamond's Investment
Like we mentioned earlier, determining the value of your diamond investment depends on how you feel about the piece. Your diamond jewelry doesn’t just have a financial value, it has an emotional one as well.
This takes money out of the being the center of the investment, and focuses more on:
- The joy the diamond brings.
- Memories associated with the piece.
- Whether or not the diamond was sourced while upholding ethical standards.
- Jewelry legacy passed down through family heirlooms.
Shifting your perspective on the investment to focus on the emotional appeal of the diamond allows you to view the piece in a different light.
The True "Value" of a Lab Grown Diamond
Here are some more valuable reasons to consider investing in a lab grown diamond over a natural one.
More Carat for Your Cash
Carats are one of the 4Cs diamonds are graded by to determine their value. Carat refers to the diamond's weight, not the size like most people think. Typically, diamonds with higher carats come with a high price tag. This is especially true for natural diamonds. Since lab grown
diamonds are more available, it’s possible to find a jewelry piece with a higher carat size you can afford.
Higher Quality for a Lower Price
Since lab grown diamonds contain the same properties as natural ones, their quality isn’t lowered. In fact, a lab diamond’s quality is just as high and more affordable. So you’re still adding an impressive piece to your collection without having to spend more outside your budget.
Peace of Mind: Ethical and Environmental Benefits
Because natural diamonds are found in the earth, specialized mining tools have to be used to find them. With this comes possible ethical and environmental issues like human labor rights violations, habitat destruction, and pollution.
Making diamonds in a lab does not come with the same issues. They’re eliminated since the same process isn’t required. People who value sustainability and protecting the environment may find this more appealing and see lab grown diamonds as more valuable than natural ones, especially since they’re just as real.
What About Very Rare or Colored Lab Diamonds?
Lab grown diamonds that are colored or considered to be “very rare” still have a lower resale value than natural diamonds. It all circles back to the lack of natural rarity since they were still produced in a laboratory.