As they have been for many years, diamonds remain the top choice for engagement rings and wedding bands. However, you’ll need to choose whether to buy laboratory-created or mined diamonds. While price is important, value is subjective. The symbolism and sentiment behind your choice of ceremonial gems are also precious to you and your partner. Here are some issues to consider when deciding whether lab-grown diamonds are as valuable as mined diamonds to you and your partner.
Deciding the Value of Diamonds
So, where do you begin in measuring the value of diamonds? Generally speaking, you can look at three features:
- Purchase prices
- Resale prices, and
- Emotional or sentimental value.
While these qualities aren’t absolute in nature, once you’ve considered them, deciding which type of diamond to buy should be easier.
Compare Purchase Prices
Let’s start with an obvious matter—the difference in price between naturally formed and manufactured diamonds. While lab-grown diamonds are as genuine a diamond as their mined counterparts, the cost difference comes from how they are created and sourced.
Creating diamonds in a lab is expensive. Specialized equipment, technicians, sourced material, and energy are all needed in the production process. But mining production costs are much higher. Remote locations, the depth from which diamonds must be extracted, constructing mines, roads, rail, and housing miners and technicians, are significant input costs. Laboratories come out ahead, producing diamonds at roughly 50% to 70% less cost than mined diamonds.
Both industries incur the same costs for transforming raw diamonds into commercial gems. Cutting, polishing, and precious metal settings significantly add to each diamond stone’s retail price.
The 4Cs — Carat, Cut, Color, and Clarity
The price of a specific diamond comes from four characteristics—carat, cut, clarity, and color. Expert diamond graders examine the faceted stones, using grading systems to certify each gem’s authenticity and precise qualities. The rating given to the diamond is used to set its retail price.
With the lower cost of production, lab-grown gems sell for over 50% less than an identical mined diamond — a significant boost for your jewelry budget. The cost-saving can be used to buy a larger center point diamond or more diamonds for an elaborate setting. Or perhaps to save more money for the honeymoon! You certainly have more options if you choose lower-priced lab-created diamonds.
Resale Comparison Between Lab-Grown and Mined Diamonds
Sadly, lab-grown and natural diamonds significantly decrease in price as soon as you walk your precious purchase out of the store. Depending on market conditions and how long you have kept the gems, you can lose anywhere between 30 - 50% of the initial price or more.
In reality, most diamonds do not appreciate in value much over the years unless they’re a spectacular gem like the Hope or the Kohinoor. Mined diamonds do, however, appear to retain a higher value on resale than laboratory diamonds because they were purchased at a higher price to begin with. Regardless of what type of diamond you are reselling, you will be losing money off your original investment. However, your net loss will be higher when reselling a mined diamond compared to reselling a lab-grown diamond.
