Fancy Color Diamonds Are Getting Harder For Auction Houses To Find

Come May 15 and 16, both Sotheby’s and Christie’s are showcasing the best and rarest fancy color diamonds that they can obtain. Alongside this positive outlook is our realistic observation; fancy color diamonds are rare and supply is rapidly decreasing. The proof is in the pudding – we saw that the blue diamonds that were sold in New York at the recent April auctions were not new from the mines, but are actually from the secondary market, so they were pre-owned. Does buying pre-owned diamonds make them less valuable? Not at all. In fact, at this auction, we see a 300-year-old blue diamond being offered. However, it does demonstrate that the pool for valuable diamonds to be drawn from exists only from whatever diamonds are already available.

Sotheby’s Top Lots for its Auction

On May 15, Sotheby’s will be the first to open its auction doors in Geneva and will be offering some unique fancy color diamonds. This time, the top lot is not a fancy color diamond, but it is still rare. Their star of the evening is a 51.71 carat D color Flawless diamond that is 3x with no fluorescence. It is valued by the auction house to sell at a price between $8.18 million to $9.46 million, or $158k to $183k per carat. We have seen similar diamonds sell for higher prices, which means that this diamond can possibly sell for an even higher price than the auction house’s estimate. There was a 118.28 carat round brilliant diamond that sold for over $260k per carat in 2013, and an 84.37 carat diamond that sold for $192k per carat in 2007. From my limited knowledge of colorless diamonds (I specialize in fancy color), if this diamond sells for above $190k per carat, it means that the large colorless diamond market is stable. Anything below the $160k per carat estimated price will indicate that large colorless diamonds are getting a hit like the market for their little brothers and sisters. In 2009, a 29.53 carat diamond sold for $118.5k, but that diamond was Internally Flawless, and Flawless diamonds fetch about 65% more than Internally Flawless ones so the clarity should be reflected in the price.

The 51.71 carat D color flawless diamond          Image credit: Sotheby’s

 

Historic Blue Diamond, the Farnese Blue

A 300-year-old blue diamond will appear at auction that evening. It is certified as a 6.16 carat Fancy Dark Grey-Blue diamond with an SI1 clarity, and it has been named the Farnese Blue diamond. In this case, it is not the color that will attract a buyer, but the provenance – the history behind the diamond. It is valued by Sotheby’s to sell at $3.64 million to $5.2 million, or $591k to $844k per carat. This is a large ticket item, but the history behind it will bring its new owner such a delight. This is a unique diamond for a collector and less so for an investor.

The 6.16 carat Fancy Dark Grey-Blue Farnese Blue diamond          Image credit: Sotheby’s

 

A rare pair of earrings will be offered as well. It is a cross combination between blue and pink diamonds. The pair has 4 major diamonds. On 1 side there is a 6.41 carat Fancy Light Blue I1 diamond together with a 8.03 carat Fancy Light Pink VVS2 diamond. On the other side there is a 7.16 carat Fancy Light Pink VVS1 diamond together with a 6.25 carat Fancy Light Blue VVS1 diamond. Both of the diamonds on the latter earring come with certificates stating that they can be re-polished into Internally Flawless clarities. All of the diamonds are pear shapes. The pair of earrings are valued at $2.8 million to $4 million total. Let’s see what happens that evening. It is possible that the market will not be as motivated to buy such light colored diamonds as the auction house believes.

The Fancy Light Pink and Fancy Light Blue diamond earrings          Image credit: Sotheby’s

 

Another diamond being offered is a 2.63 carat Fancy Vivid Purplish Pink SI1 modified round brilliant. It is rare to see such a round diamond at this size and color, so it is unfortunate that the clarity is low. The clarity can be compensated for if the color is extremely strong, which I will see when I arrive in Geneva in just 2 short weeks for the auction. It is valued to sell at a price between $2 million to $3 million, or $759k to $1.138 million per carat. The only reason that this valuation is so high for such a color is due to the fact that it is cut into a round brilliant shape, the rarest shape in fancy color diamonds.

The 2.63 carat Fancy Vivid Purplish Pink SI1 modified round brilliant diamond          Image credit: Sotheby’s

 

The next item for review is the 5.04 carat Fancy Purple-Pink SI1 pear shaped diamond. The balanced color between purple and pink that this diamond exhibits is rare, especially at the 5+ carat size, which fact will compensate for its low clarity. It is valued at $1.2 million to $1.8 million, or $239k to $357k per carat. If the color is nice enough, then we might see a price that will go above its high value.

The 5.04 carat Fancy Purple-Pink SI1 pear shaped diamond          Image credit: Sotheby’s

 

A 2.52 carat Fancy Vivid Yellowish Green diamond is being offered whose color is nice and strong. The auction house has valued it at a price between $500k to $800k, or $198k to $318k per carat. Although it is a half cert, which is an indication of some poorer characteristics, the color may be strong enough to compensate for it.

The 2.52 carat Fancy Vivid Yellowish Green diamond          Image credit: Sotheby’s

 

Another item to be offered by Sotheby’s that night is a 9.70 carat Fancy Light Purplish Pink diamond with a VS2 clarity. It is estimated to sell between $500k to $700k, or $51.5k to $72.1k per carat.

The 9.70 carat Fancy Light Purplish Pink VS2 diamond          Image credit: Sotheby’s

 

A collector’s diamond that will be sold that evening is this 1.43 carat Fancy Deep Bluish Green diamond with an SI2 clarity. The color is very unique and strong. It is estimated to sell at a price between $478k to $582k, or $334.5k to $407.2k per carat. These are very strong prices, perhaps there is an upgrade here? It remains to be seen whether any collectors will see the value and take the plunge.

The 1.43 carat Fancy Deep Bluish Green SI2 diamond          Image credit: Sotheby’s

Christie’s Top Lots for its Auction

The following day, Christie’s is hoping that they will attract the top dollar investors as well. Their highest valued diamond is also a colorless diamond; but this one is by the famous Harry Winston. The 50.47 carat D color diamond has VVS1 clarity (but is potentially Internally Flawless) and is classified as a Type IIa. It is currently valued to sell at a price between $5.1 million to $7.15 million, or $101k to $141.6k per carat.

The 50.47 carat D color diamond VVS1 diamond          Image credit: Christie’s 

 

The second highest valued item of the auction is a 33.51 carat Fancy Light Purplish Pink VS2 diamond. It is valued to sell between $4.08 million to $5.1 million, or $122k to $152k per carat. As recently as November 2017, a 33.63 carat Fancy Light Pink was sold for $381k per carat at a Christie’s Geneva auction, but that diamond was upgraded to a Fancy Pink, which justifies the high price paid. Is this one also upgradeable? Is this the new selling point that auction houses are using to push their listings?

The 33.51 carat Fancy Light Purplish Pink VS2 diamond          Image credit: Christie’s

 

It has been a while since we last saw an amazing pure Fancy Vivid Yellow diamond, and this 20.49 carat Fancy Vivid Yellow VVS1 is just such a diamond. It is valued at $3.88 million to $4.6 million, or $189k to $224k per carat. Rarely do we see a fancy vivid yellow diamond valued at these levels. There is a very small percentage of yellow diamonds in this unique category. The highest price ever paid for a Fancy Vivid Yellow was $250k per carat. Will we see a new record here?

The 20.49 carat Fancy Vivid Yellow VVS1 diamond          Image credit: Christie’s

 

The next item in terms of value is the 8.52 carat Fancy Intense Purplish Pink diamond with a rare VVS1 clarity. It is valued between $3.57 million to $5.1 million, or $419k to $600k per carat. In our opinion, the valuation is modest. If the color is strong, the price will exceed the high end of the auction house’s estimate. There is a possibility that the color is weak enough to be closer to a Fancy Pink, at which case the lower end value is indeed appropriate. We will be examining the diamond right before the auction and will be able to determine its true appeal then.

The 8.52 carat Fancy Intense Purplish Pink VVS1 diamond          Image credit: Christie’s

 

This value range that the diamond was given is far below the record price paid for such a color and size. The current record is $1.88 million per carat which was paid back in May 2017 at the Sotheby’s Geneva auction for a 7.04 Fancy Intense Purplish Pink VS1 diamond. That diamond was most likely upgraded to a Fancy Vivid Pink color following its purchase, which could justify the high price that it earned.

The 7.04 Fancy Intense Purplish Pink VS1 diamond          Image credit: Sotheby’s

 

The next item is unique in terms of color combination. Normally we combine pink and blue diamonds in rings, but this ring has a combination of yellow and blue diamonds instead. The ring features a 5.03 carat Fancy Vivid Yellow SI2 diamond and a 4.16 carat Fancy Vivid Blue SI1 diamond. It is disappointing to see such low clarities, but hopefully the colors are strong enough to compensate. The ring is valued at $2.55 million to $3.57 million. Such a vivid yellow with a clarity would be valued at $35k to $40k per carat, a total of about $200k for the diamond, which means that the rest of the value is stored inside the vivid blue diamond. That value is between $2.35 million and $3.35 million, or about $564k to $805k per carat. If the vivid blue diamond can be recut, remain above 4 carat and be upgraded to a VS2 or VS1 clarity (depending where the flaws are), there is a great chance that this valuation is low. We will see its viewed potential by the closing price of the ring.

The blue diamond and yellow diamond ring          Image credit: Christie’s

 

A 5.19 carat Fancy Intense Pink SI2 diamond will be sold by Christie’s and has been evaluated to sell at a price between $1.5 million to $2 million, or $295k to $393k per carat. The price range reflects that of a Fancy Pink, a lower color grade than Fancy Intense Pink, so perhaps the color is weak and the auction house took that into account when making their estimation. If the color is strong, and it can be re-polished to a VS2, the price will exceed the high value.

The 5.19 carat Fancy Intense Pink SI2 diamond          Image credit: Christie’s

 

The last item of discussion is a 21.03 carat Fancy Light Pink VVS2 diamond with a potential upgrade in clarity. It is valued at $1 million to $1.53 million, or $48.5k to $72.8k per carat. There are no records of any other light pink diamonds sold at auction except for the famous 19.07 carat Fancy Light Pink historical diamond sold on November 14, 2017 at the Christie’s Geneva auction. It was sold for a total of $14.46 million or $758k per carat. Perhaps this diamond will contribute to establishing an auction price history for this diamond color and color intensity.

The 21.03 carat Fancy Light Pink VVS2 diamond          Image credit: Christie’s

The 19.07 carat Fancy Light Pink “Le Grand Mazarin” diamond          Image credit: Christie’s

 

Our overall view is that not many unique diamonds will be presented this month in Geneva, which reflects the difficulties that the auction houses are having to find rare items for the public. This further demonstrates that rarity will cost investors and collectors top dollar, but they are willing to pay for those items. The auction arena is a great “profile-raising” way to educate investors and collectors. However, at the end of the day when an investor does the necessary due diligence and research, they will end up finding what they need, without necessarily needing an auction house in order to buy it. Got any questions about the standards of auction house diamonds or about what makes a diamond qualify for our list of highlights? Ask us in the comments!

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