Diamonds and 5 Other Luxuries That Are Getting Cheaper

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The slowdown in China and falling commodity prices give buyers of jewelry, watches and wine more bargaining power.

After years of belt-tightening, Americans may finally be getting back in the mood to live a little: Consumer sentiment, despite the stock market’s recent hiccup, is back to levels not seen since 2007.

And it turns out this may be a good time to buy. In reporting the upcoming MONEY magazine feature “What to Do With $1000 Now,” we learned that many luxury goods—from diamonds to Swiss watches—are either coming down in price or becoming more accessible, with companies offering less-expensive lines in an attempt to draw in more customers.

Here’s why: While the American economy has been on the mend, those in Europe and Asia—China in particular—are sputtering. Over the past decade, China’s remarkable economic growth has been minting new millionaires. These new rich account for nearly a third of luxury spending, according to consulting from Bain & Co. But now with China’s growth slowing, and a government anti-corruption campaign targeting public displays wealth, their spending is cooling off too.

Now add in falling prices for commodities like gold and silver.

Luxury purveyors don’t like to publicly slash prices. But they’re subject to the same laws of supply and demand as everyone else. The result is that there are likely deals to be had—whether it’s in the form of a lower sticker price or just getting more for your money. Here is where you can start looking.


    China has become the world’s second largest market for diamonds, so Shanghai’s stock market plunge alone would bad enough for diamond producers. But even before that, the $80 billion industry was hurting. As regulators cracked down on the banking industry in the wake of the financial crisis, financing for much of the famously secretive and informal diamond industry dried up. That’s forced many traders to sell off inventory, flooding the market with gems. At the start of August diamond prices were down 14%, year over year. The weakness is filtering through into consumer prices too. At online retailer Blue Nile, a round, 1.4 carat diamond with clarity rated VS1, recently retailed for $9,932 on the site, down about 10% from $11,085 last year. At a more down-to-earth price point, two 0.36 carat diamonds with setting for earrings that used to cost about $1,500 can now be had for just over $1000.