Grosse Pointers Join The Gold Rush

The skyrocketing price of gold, which hit a historical high of $1,917.90 per ounce Aug. 22, has for months been prompting Americans to reach into jewelry and safe deposit boxes to trade their valuables in for cash. Grosse Pointers are among them. 

Visits to several of the cities’ jewelers revealed varied and at times charged opinions about gold buying in this historically affluent community. Some jewelers spoke openly while others declined comment altogether or provided background only. 

Yes, the jewelers said, Grosse Pointers are selling their gold.

Gold buying is not new. As James Cole, owner of on Mack in the Woods, noted, “jewelers in general have always used gold to offset the cost of special order work or repairs.” Take ring sizing: jewelers typically charge less to make a ring smaller than they do to enlarge it because they keep the gold they remove. People have “forever” traded in gold jewelry to jewelers to apply its value to a new piece of jewelry, he said. 

in the Woods does not buy gold but does allow customers to trade in their pieces.

The phenomenon of “individuals selling gold strictly for the money it represents is new—within the past three or four years,” said Cole, who has a sign in his store window reading “I Buy Gold.” Despite the growing popularity of gold selling, customers are still looking for discretion.

“Because of its relationship to pawning, people see an underlying stigma to gold buying,” Cole said. He also suggested there are regional variances in the public’s perception of selling their valuables. In some parts of the country, people may view this as practical, he observed. “Midwesterners are sentimental”—they're uncomfortable with the idea of selling items that have been in their family.

Other Grosse Pointe jewelers insist that most of their customers are merely unloading items they truly don’t want in exchange for the unprecedented cash payment.

John Ahee, vice president of , said his store does not advertise gold buying because of negative public perception but is nevertheless happy to provide the service. The store, he said, buys gold outright and also welcomes trade-ins.

“Some people have gold pieces they’ve never worn, or something they no longer want because it brings bad memories,” he said. With gold at record-high prices—it was valued at $250 an ounce ten years ago, he noted by way of comparison—it’s a great time to “turn those pieces into something fun and fresh and new.”

is perhaps the boldest advertiser of gold buying—he’s placed a large yellow sign in his storefront window. Manager Kim Pascarella said each day customers from Grosse Pointe and the surrounding area are bringing in several thousand dollars worth of precious metals to sell. While some of it is platinum and sterling silver, about 80% of this volume is gold, she said.

The items Dimaggio sees, Pascarella said, “are broken, mismatched. A lot of it is yellow gold because the customer has moved on to white metal and it’s no longer fitting into their wardrobe. With gold going so high, people feel it’s the right time to cash in.”

Pascarella, who said Dimaggio is also buying fine time pieces and precious stones, believes the soaring price of gold has caused much of the stigma associated with gold buying to pass away. Now, she said, it’s just smart business.

“I think people are very happy to do it,” she said, adding that appraisals are free and take just a few minutes. “Everyone has need for some extra money right now, and people are making use of jewelry they don’t want.” While there is occasionally someone “who comes in out of misfortune—they’re pressed to sell to pay the mortgage or medical bills,” she estimates “95% of our customers are very happy when they come in. Every time I give an estimate I see very excited expressions.”

Prices for jewelry vary according to the purity of the gold used, but Joe Dimaggio said his customers can realize upwards of $38 per gram for fine jewelry made of 18K gold or higher.

“I’ve seen people pulling stuff out of drawers and getting more money from us than they paid for it 15 years ago,” he said.

 If you’re thinking of selling gold, here are some things to remember:

• Mail-in gold buyers will usually pay you less for your gold than independent, store-based jewelers because they have higher overhead, such as packaging, postage and advertising.
• Make sure to shop around and get at least two or three quotes before deciding where to sell.
• The price of gold fluctuates hourly, just like the currency exchange rate. That means a jeweler could theoretically pay more (or less) for the same gold ring in the afternoon than he or she would in the morning on any given day. But since it’s impossible to predict and the price changes are not usually that great, it’s not worth worrying about.
• The karat of gold is a measure of its purity. 12K gold contains less gold (and more alloys) than 18K gold. Therefore, you will get more money for an 18K gold ring than for a 12K gold ring of the same weight because it contains more gold.
• Jewelers take a portion of the value of your gold as payment for the service of buying it. The most important question you should ask a jeweler is, “What percentage of the spot price will I get?” In other words, you are asking what percentage of the gold value they will keep and what percentage you will get. What you’ll accept is a personal decision, but 85% or higher is considered a very good payout.
• Jewelers will pay more for precious metals in bulk, so you’ll get a higher price per gram if you bring in a bag of jewelry than if you bring in a single bracelet.
• You will often realize more value for your gold if you trade it in to a jeweler than if you sell it outright. Jewelers can discount their own items, and sometimes pay more for your gold if you apply the value toward the purchase of a new item rather than simply taking the cash.
• The single best thing a consumer can do is to know what he or she has before taking the gold into a store for a price quote. Weigh the items, know what karat grade you have and use an online calculator to calculate how much your items are actually worth.