Book Value Vs. Reality

I picked up Michel Specialized German Catalog recently. Amazing detail! The number of varieties, errors, etc. is mind boggling. So of the varieties on some of the stamps I have discovered are in the $1000s of dollars.

If I were to sell some of these stamps to a dealer, what price could I realistically expect?

Pricing depends on a lot of factors. Most collectors expect to be able to buy stamps of average condition and grade for about 10-50% or so of catalog values. That's the retail value. Figure a dealer will give you a half or a third of retail. Large collections, sold as a collection, will rarely realize more than 5 or 10% of catalog. There are a lot of factors involved, though, so it's impossible to make a blanket statement. If your stamp is scarce enough and in ultra-high quality, a dealer may gladly pay full catalog, because he knows he can flip it immediately for, say, 1.5 or 2x catalog. If it's something he thinks he might not be able to sell for awhile, he'll lowball it even more.

Thanks ArtfulHinger. That's kind of what I thought. Is ebay the best place for someone like me to try to get a feeling for market demand?

databanks,
Please consider posting a image here of the stamps you think have value. Some of the folks here can give you a better idea of what you have and what it might be worth.
Don

Thanks Don, I will do that.

Databanks ----If your looking to sell common material , you will get 5% to 20% of catalog ,now common material does not mean low catalog value . The problem here is two fold ,most people don't know what is common material and in a few cases put up rare material at a low percentage of catalog .The second is a lot of sellers search around to see what is already listed of that stamp and have a tendency to list their stuff lower so they can sell it .This what I call the "race to the bottom" prices are falling because everyone wants to sell now and have the best price to make a sale .

Floortrader - good point. But that begs the question: How does someone determine what is common and what is rare?

To sell your stamps and get the most you have to somehow " match the stamps to a buyer" find someone who is looking for that type of item. If you have German stamps and walk them into some local dealer who does a little of all kinds of stamps he will give you something but not even close to what its worth. You have to find someone who "wants" what you have to offer.

In general, common stamps will be cataloged low and rare stamps high. What Paul (floortrader) is trying to point out is that some medium to higher cataloged stamps are actually quite easy to find and therefore not really rare. Dealers will not pay as much, as a percentage of catalog, for the more common high value stamps than they will for the truly rare.

Examples might be the USA Graf Zeppelin stamps or the British Penny Black. They all catalog reasonably high (hundreds of dollars) and they are all easily found. Dealers will only pay a significant portion of catalog value for exceptional examples because they know they can find plenty more of the average ones.

Ah, that makes sense. Thanks for the insight Jim and billsey. I know a little bit about coins. But stamps are by far a more complicated collectible, so I appreciate the time you all are taking to help me learn.

I recognize that Michel does a great job listing varieties, especially for European philately. And I do see a lot of the European sellers pricing material based on a percentage of Michel, which is MUCH higher than Scott pricing for stamps listed by both sources. Some American sellers have gotten into the act- they list material by Scott then quote a catalog value which comes from Michel to make you think they are selling at a reasonable "percentage" of catalog.

All that said, material priced by Michel (say in the range of 40% of cat and up) sits for a really long time unsold. I have been watching some Netherlands sets on ebay for years that have never sold or had their price modified. The seller involved but be wealthy beyond any reckoning, as he is not generating cash flow or inventory turns from his "rarer" material.

So what is rare, and what is rare material worth? It takes time to acquire this knowledge for a given area. My deepest knowledge for pricing is in the KGVI era for British Commonwealth. In this area, Bermuda keyplates showed intensive pricing growth from the late 1980's until perhaps the mid-2000's. Then, several very large holdings of Bermuda keys hit the market making most printings of the keyplates much, much easier to find. Still, sellers held onto established pricing "habits" based on the past, and only very reluctantly began to lower pricing. Even today, keyplates are generally overpriced as SG has not adjusted prices to reflect the market. And why should they? They are a retail stamp business that needs to protect their investment. In the background though, if you are selling they explain the market forces behind much lower buying prices, but they surely do not tell you this if you are buying from them.

As I am learning about new areas of philately, I have realized (with A LOT of help here on SCF) that other countries are cataloged way beyond their market price. Some examples are Germany, Austria, most if not all of Scandanavia, Benelux, and Liechtenstein among others. This may be due to reduced demand in the US which seems to have a withering collector base for European stamps.

The rule of thumb I am developing and learning is to see if certain material is available from US sellers. If it is, then it is overpriced in Michel. If you can't find it in the US (something I see with Spanish and Portuguese Colonies, and certain French Colonies), then the Michel value is somewhat more in tune with the marketplace.

Just some thoughts.

Remember that different catalogs have different standards for grading. Michel is based on the German stamp market, where collectors are very discriminating. A VF stamp in Scott could easily be in poor enough condition that it wouldn't sell in Germany, and a stamp that sells in Germany for full catalog would likely be considered XF or Superb in the US, selling for higher than catalog. SG is a special case since they are quoting their retail listings.

It's all a bit confusing and there is no substitute for experience. That being said you can approximate expected retail by sticking to one catalog and adjusting to the stamp condition or by using percentages and filtering values from a specialized catalog into your chosen catalog.

For instance, if a stamp catalogs at $100 in Scott and has F-VF centering with no faults it will sell for about half catalog. If it has one pulled perf it'll sell for about half that. If it also has a repaired corner perf it'll sell for about half down again, or $12.50...

If the base stamp catalogs for $100 in Scott, for €130 in Michel and an unlisted in Scott variety in Michel is €400, then it should sell as if it were listed in Scott for $300, since 400 is about three times 130.