Lab-grown diamonds have become significantly more accessible over the past five years. For buyers entering the market in 2026, understanding how lab-grown diamonds are valued on resale — and how appraisals work — is genuinely important information that shapes the purchase decision. This guide is written to help you make an informed choice, not to discourage you from buying lab-grown diamonds.
Diagem has supplied both natural and lab-grown diamonds to South African buyers for over 25 years and has watched the market shift dramatically since 2020.
Why Lab-Grown Resale Is Challenging
The lab-grown diamond market has experienced one of the most dramatic price compressions of any commodity in recent memory. In 2020, a 1.00ct F/VS2 lab-grown diamond sold wholesale for approximately $3,500–$4,500 USD. By mid-2025, the same stone was selling wholesale for $400–$600 USD. That is a price drop of approximately 80–90% in five years.
The driver is straightforward: supply scaling dramatically faster than demand. Lab-grown diamond production — primarily from India, China, and the USA — has expanded enormously. The marginal cost of producing a lab-grown diamond continues to fall as the technology matures. Unlike natural diamonds, where new supply is geologically constrained, lab-grown production can be increased indefinitely as long as reactors and facilities exist.
For buyers, this means two things:
- Lab-grown diamonds purchased even 3–5 years ago have lost most of their market value. A stone purchased in 2021 for R35,000 might fetch R6,000–R10,000 today at best.
- The future trajectory of lab-grown prices is almost certainly flat or downward. Technology improvements continue to reduce production costs, and supply continues to increase. There is no supply constraint mechanism that would cause prices to recover meaningfully.
This does not mean lab-grown diamonds are a bad purchase. It means they should be understood as a consumable luxury good — something you buy for the enjoyment and beauty it provides — not as a store of value. Compare this with natural diamonds, where price trends, while not consistently upward, are fundamentally supported by finite and declining natural supply. See our diamond investment guide and natural diamonds page for a fuller comparison.
How Appraisals Work for Lab-Grown Diamonds
This is where many lab-grown diamond owners encounter a confusing gap between paper value and market reality.
When you have a lab-grown diamond appraised for insurance purposes, the appraiser will typically value the stone at its replacement cost — what it would cost to replace it with an equivalent stone at current retail prices. Because retail prices for lab-grown diamonds have also fallen significantly (though not as dramatically as wholesale), the insurance value will typically be set at current retail replacement cost.
This creates an apparent situation where your stone is “worth” a certain amount according to the appraisal, but would actually sell for significantly less on the secondary market. The appraisal value is not a lie — it genuinely reflects what a retailer would charge you today for an equivalent stone. But the secondary market price for a used stone is typically 20–40% of that appraisal figure, if you can find a buyer at all.
Getting Your Lab-Grown Diamond Appraised
For insurance purposes, any SAASGEM or GAASA-accredited gemologist in South Africa can appraise a lab-grown diamond. You will need your IGI LGDG certificate (or GIA report if your stone was graded by GIA). The appraiser will verify the stone against the certificate and issue a written valuation at replacement cost. This typically costs R300–R700 and is required by most insurers for scheduled jewellery cover.
Insurance Implications for Lab-Grown Diamond Owners
Lab-grown diamonds should be insured, but some nuances are worth understanding:
- Insure at replacement cost, not at what you paid. If lab-grown prices have dropped significantly since your purchase, your stone’s replacement cost may be lower than your purchase price. Get a current appraisal rather than insuring at the original invoice value.
- Update your insurance valuation every 2–3 years. Lab-grown prices are changing faster than natural diamond prices. An appraisal from 2022 is likely materially overstated relative to current replacement cost, which means you may be paying unnecessarily high insurance premiums.
- Understand what your policy pays on a claim. Most policies pay replacement cost. If your 1.00ct lab-grown is lost or stolen, the insurer will replace it with an equivalent stone at current cost — which may be well below what you originally paid.
Natural vs Lab-Grown: A Value Comparison
- Finite, declining supply
- Price supported by scarcity
- Holds value better on resale
- Easier to find secondary buyers
- Better long-term investment profile
- Higher purchase price
- Unlimited supply potential
- Prices falling as costs drop
- Very limited resale market
- Resale typically 10–25% of cost
- Not suitable as investment
- Lower purchase price
The right framing for a lab-grown diamond is this: you are buying beauty and brilliance at a lower price point. You are not buying a store of value. For many buyers, that trade-off is entirely rational — the stone looks identical to a natural diamond, wears identically, and provides the same aesthetic experience. The difference only matters if you ever want to sell it.
Realistic Expectations If You Want to Sell
If you have a lab-grown diamond and want to sell, here is what to realistically expect in the South African market:
- Most pawnbrokers will accept lab-grown diamonds but will offer very little — typically 10–20% of original cost.
- Diamond dealers may or may not be interested, depending on current inventory and market conditions. Lab-grown stones that were fashionable shapes 3–4 years ago (round brilliant, oval) are more sellable than unusual shapes.
- Private sales are possible but finding a buyer who is comfortable purchasing a lab-grown diamond privately takes time. The IGI LGDG certificate is essential documentation for any private sale.
- Online platforms that specifically deal in pre-owned lab-grown diamonds exist internationally (primarily in the USA) but shipping internationally from South Africa involves customs complications.
The honest summary: treat the sale price of a lab-grown diamond as a pleasant bonus if it works out, not as something to count on.
Making an Informed Decision at Purchase Time
The best time to understand lab-grown resale dynamics is before you buy, not after. If long-term value matters to you, choose a GIA-certified natural diamond. If beauty, size, and current enjoyment are the priorities and you are comfortable with the consumable-luxury framing, a well-certified lab-grown diamond from a reputable supplier is an excellent choice at its current price point.
David at Diagem will always be straight with you about this trade-off. We sell both natural and lab-grown diamonds because they serve genuinely different buyer needs — and the right choice depends entirely on your situation.
Questions about lab-grown diamond appraisal, insurance, or resale in South Africa? Chat with David for honest, no-pressure guidance.
Chat with David on WhatsAppOr contact Diagem online — we’re based at Knox Safes, 1 River Street, Houghton Estate, Johannesburg. Appointments by arrangement; nationwide delivery available.