The answer
is it depends.
The investment
aspect of handmade oriental rugs is a byline that unfortunately is often
used by rug dealers trying to close a sale. For the majority of customers,
the idea of a handmade rug having future value is secondary to getting
what they want.
It is important
to remember that a typical investment is something that one buys with
the intention of selling for a profit. An investment should have a liquid
and efficient secondary market. A liquid market means that anywhere
in the USA you should be able to sell your rug within a short time period.
An efficient market means that anywhere in the USA you should be able
to sell your rug for the nearly the same price. Neither of these markets
exist for rugs having less than at least 50-75 years of age. We come
closest to a liquid and effecient market for antique oriental rugs in
the finer auction houses like Sotheby's.
Regardless of whether
we are discussing rugs, antiques, homes, or stocks the price is directly
affected by the scarcity of the item and demand for the item. The craftsmanship
of a home or quality of a rug does not affect the resale price when
the item is not in demand.
Why is this important
for oriental rugs?
- In the short
term if an oriental rug is still available from the importers and
the wholesale price has not increased, then retail rug stores will
not be interested in buying your rug back at the retail price you
paid. At this time you are trying to sell a used rug.
- After 50-75
years, if the rug is in excellent condition for its age, your rug
may be scarce. Other similar rugs will have been damaged and will
have lost their value.
- Even if your
rug is scarce, in fifty to sixty years, the future market of buyers
will decide if the colors and design of your rug is desirable. Your
children and grandchildren will create the demand. As we all know,
tastes change.
The best way to insure you are buying an oriental rug at a fair price
is to buy from an established rug dealer that has earned the trust of
the community.
There are new handmade oriental rugs that are considered
investment quality.
These rugs tend to be the finest example of rugs from the different
weaving areas. They can be tribal or formal designs. What they share
is the highest quality materials and execution of design. What they
also share is a very high price. There are no deals when we are talking
about investment quality rugs. The rug market is very aware of what
makes a fine rug and they are priced accordingly.
Buy Back Guarantees
A rug store that
guarantees to buy back your rug at your purchase price is trying to
close the sale, hoping that only a few people ever take them up on their
buy back guarantee. Do not be surprised to find it difficult to return
the rug after you have used it for more than a year. Ask yourself, "What
other industry uses such a guarantee to sell an item?". Furniture
stores do not guarantee to buy back their furniture. Mercedes-Benz does
not guarantee to buy back their automobiles. Why would a reputable rug
dealer offer a guarantee that goes against the fundamentals of good
business.
At W.E. Esber Imported
Rugs, we have been "buying back" or "taking-in-trade"
our customers' rugs for as long as we have been in business. The difference
in our practice is that we give you the current wholesale value of the
rug in its current condition. If we gave you the retail price, we would
not be able to make a profit.
You are buying a handmade rug that you will walk on and vacuum for many
decades. It is made out of natural materials. If you take care of your
rug it will outlast five or six broadloom carpets. An oriental rug's
design will help hide stains and can be thoroughly cleaned. It should
contribute to the beauty of your home and in turn the quality of your
life. After 30 years, do you want all of that and to sell it back for
the price you paid?
To learn
more about oriental rugs please read the "Oriental
Rug Buying Guide." I also encourage anyone to visit our store
and ask for me, Chet Esber. I would be happy to help you learn more
about handmade oriental rugs.
