Everything You Own Falls into One of Three Categories
by Mark Pusateri
What's it worth? This is the most common question I am asked. Whether we are considering replacement value (retail) or estate value (wholesale...sort of), knowing which of three categories the item falls into is key to producing an accurate valuation.
Utility: Some items are valued solely for their utilitarian characteristics.
Example: A stew pot has value because you can cook in it. In addition, its value will be determined in part by the quality of its construction, its potential longevity, its specialty features (nonstick, etc.) and its current condition. Take all these factors into consideration, as well as the cost of acquiring a new stew pot of comparable quality and you will have the approximate estate value of your stew pot.
Most household items fall into the Utility category: tools, used furniture, dishes, books, etc. One aspect of utility which people sometimes have difficulty grasping is decoration. That an item looks pretty hanging on a wall or sitting on a shelf is actually a form of utility.
Nostalgia: Some items are valued by us because they bring back memories. Nostalgia in Greek literally means, 'longing to return home.' Nostalgia takes the value of an item beyond mere utility.
We are not talking about the sentimental value you might attach to something because it belonged to a family member. Nostalgia value is invested in an entire class of objects, not just one specific object of that class with a particular association.
For example: Some YoYos are valuable because people of a certain age remember playing with them and now want to collect them. Your YoYo will not have any additional value to anyone other than you because it belonged to your father (unless he was famous).
This brings us to an important aspect of Nostalgia value - it is generational. When people reach a certain age and level of success, usually in their forties and fifties, they begin to buy and collect things they remember from their youth. You can see this now in the fact that children of the seventies are seeking out certain Pyrex cookware they remember their mothers using. Some other examples: Dick and Jane readers, metal lunch boxes, classic board games...the list goes on.
Something important to note about Nostalgia items is that they tend NOT to hold their value over time. Once a generation reaches its sixties, the number of people buying items for nostalgia reasons falls off dramatically and prices tumble. You can see this in the depression glass market which has cooled since the boom of the 1980s.
Another good example is found in McGuffy Eclectic Readers. This was a series of books that taught America how to read from the 1890s to the 1930s. Ten years ago, nice examples would readily sell for $100 in antique shops. Today, a dealer would be very fortunate to get $20. The reason for the fall is that those people who grew up in the 1930s and remember using them are no longer in the nostalgia market.
The same pattern, though less dramatic, can be seen in the prices of classic cars. Each generation wants the cars they couldn't have when they were teens.
Affinity: This is the king of the value categories. These are the things that people lust after.
Antiques, fine art, oriental rugs, etc. Names like Tiffany, Rolex, Limoges, Beleek, and Baccarat.
Affinity items have value far in excess of their utility and their desirability crosses generations to transcend nostalgia. These items spawn collectors' groups, magazines, and guide books. Specialty dealers can make very good livings focusing on a single affinity area.
These are the things that appreciate in value over time...for the most part. There is also a dark side to affinity. Remember Beanie Babies? Fads are affinity for affinity's sake; there is no underlying merit to the objects of fad affinity. Those caught up in the fad simply desire the item because other crazed souls do as well.
A cousin of the fad is the manufactured collectible. These are objects made for the sole purpose of selling to collectors. Some hold their value or even appreciate: Lladro, Hummels, limited edition books, certain limited edition prints. Others are basically junk with very little resale value: most collector plates, certain limited edition prints, and just about any 'collectible' sold on TV.
Keep these categories in mind when you shop, or just when looking at the things around your house. Knowing the WHY of value will make you a more astute buyer and collector.
