Thinking about buying a diamond, or wondering what yours is really worth?
Here’s the truth most jewelers won’t tell you:
Diamonds are generally a poor investment.
Whether natural or lab grown, most diamonds lose value the moment you buy them. The difference is how much you lose, and that’s where understanding the market really matters.
If you’re comparing natural vs lab grown diamonds, this guide will help you make a smarter financial decision, especially if you ever plan on reselling.
Natural vs. Lab Grown Diamonds: What’s the Difference?
At a basic level, both are real diamonds.
They share:
- The same chemical structure (carbon)
- The same physical properties
- The same visual appearance
Natural Diamonds
- Formed over billions of years underground
- Limited supply (but still widely available)
- Traditionally marketed as “valuable”
Lab Grown Diamonds
- Created in weeks using advanced technology
- Increasingly abundant
- Much lower upfront cost
They are visually identical, but financially very different.
The Biggest Myth: Diamonds as an Investment
Let’s be direct: Diamonds are NOT a good investment for most people.
Here’s why:
- Retail markups are extremely high (with diamond jewelry usually having markups of 10x to 20x the raw material value)
- Resale markets operate at wholesale pricing, where most engagement ring diamonds sell for at most $50
- Demand is inconsistent outside of top-tier stones
- Most buyers overpay based on emotion, not value
Even natural diamonds, which are often positioned as “assets”, rarely resell for anything close to what you paid.
Unless you are:
- A professional gemologist
- Buying rare, investment-grade stones
- Deeply familiar with wholesale markets
You should not think of diamonds as an investment.
Diamond Resale Value: The Reality
Natural Diamonds
- Can retain some value
- Still typically sell for far less than retail price
- Prices have been declining in recent years
When dealing with stones larger than 1 carat, their resale value does start to grow exponentially, but it’s still far from what you likely originally spent for the diamond to begin with.
Lab Grown Diamonds
- Much cheaper upfront (often 60–90% less)
- Little to no resale value
- Prices continue to fall as production increases
Why Natural Diamond Prices Are Dropping
This is important, and often overlooked.
As lab grown diamonds become more popular and widely available, they are putting pressure on the entire diamond market.
What we’ve seen over the past few years:
- Increased supply of lab grown diamonds
- Falling prices for lab grown stones
- Reduced demand for natural diamonds at high retail prices
- Downward pressure on natural diamond resale value
In simple terms, if consumers can get the same look for a fraction of the price, they will.
That shift is already happening, and it’s affecting resale markets.
So Which Should You Buy?
Here’s the honest answer most people need:
If You’re Buying for Jewelry (Most People)
Lab grown diamonds usually make more financial sense
Why?
- You’ll spend significantly less upfront
- You get the same look and durability
- You avoid overpaying for perceived “investment value”
Yes, you likely won’t resell it for much, but you also didn’t overspend to begin with.
If You’re Thinking About Resale Value
Natural diamonds are less bad, but still not something we would recommend.
- You’ll pay much more upfront
- You still likely won’t recover your cost
- Market prices are becoming less predictable
The Real Takeaway
- Lab grown = better for buying
- Natural = technically better for resale
- Neither = strong investment for most people
When all is said and done, you’ll likely have more money in your pocket buying and selling a lab grown diamond ring than you would buying and selling a natural diamond ring of the same size.
How to Tell Lab Grown vs Natural Diamonds
Short answer: you can’t, at least not without proper tools costing tens of thousands of dollars.
Even professionals use:
- Spectroscopy
- UV analysis
- Advanced gemological equipment
Some lab grown diamonds have laser inscriptions, but they’re microscopic and difficult to detect.
If it matters, get it professionally tested.
Selling Diamonds: What You Should Expect
If you’re planning to sell diamonds for cash, here’s what to know:
- Most diamonds sell for far less than expected
- Retail price does not equal resale value, and usually reflects 10x to 20x the raw material or resale value
- Condition, size, and quality all matter
- Lab grown diamonds typically have minimal resale demand
Setting realistic expectations is important.
How The Gold Guys Help You Sell Diamonds
At The Gold Guys, we focus on honest, market-based evaluations.
What We Buy
- Natural diamonds
- Gold, silver, platinum, and palladium
- Jewelry, coins, and bullion
(Lab grown diamonds generally have limited resale value and are typically not purchased.)
How It Works
- In-store evaluation or secure mail-in kit
- Transparent pricing based on real market demand
- Fast, straightforward payment
For larger stones, we work with trusted partners to verify authenticity and ensure accurate valuation.
Buy Smart, Not Emotional
Diamonds are beautiful, but financially, they’re often misunderstood.
- They are not reliable investments
- They are retail products with markups
- Their resale value is usually lower than expected
If you’re buying: Lab grown diamonds often give you the best value for your money
If you’re selling: Understanding the market helps you avoid surprises
And if you already own diamonds or precious metals, it may be worth finding out what they’re actually worth today.
Frequently Asked Questions: Natural vs Lab Grown Diamonds
- Are diamonds a good investment?
- No. For most people, diamonds are not a good investment due to high markups and weak resale value. Do your own research before considering investing in diamonds.
- Is it better to buy lab grown or natural diamonds?
- For most buyers, lab grown diamonds offer better value because they cost significantly less upfront.
- Do lab grown diamonds have resale value?
- Very little. Most lab grown diamonds have minimal secondhand demand.
- Do natural diamonds hold value?
- Some do, but most still sell for less than retail price, and prices have been declining.
- Why are diamond prices dropping?
- Increased availability of lab grown diamonds is reducing demand and putting pressure on natural diamond prices.
- Can I sell my diamond to The Gold Guys?
- Yes, we buy natural diamonds and precious metals, with transparent pricing based on current market demand.
