Valuable Things Lying Around Your House
This weekend I saw the movie “27 dresses”, where the main character has been a bridesmaid 27 times and has accumulated a large collection of bridesmaids dresses, all worn exactly once and consuming valuable New York City storage space. It reminded me to update on my attempts at unloading some of my fiancees old prom dresses. Not surprising, not a single dress sold. I have several theories as to why this is the case.
Many people refuse to buy anything that is used. I’m not quite sure why this is as I’ve seen jeans for sale in designer stores that appear that they have been worn previously. People actually pay a premium for these jeans. The idea of buying anything in a second hand store or consignment store is particularly unappealing.
Generally I am more than willing to consider buying used. This is especially true of things that aren’t really subject to wear. For example, buying used video game discs is a no brainer for me, they will function just as well the 1st time as the 100th time provided they haven’t scratched deeply. A quick visual inspection can easily determine whether the disc is good as new. Video game controllers on the other hand are more tricky. How do I know if the controller has a button that sticks sometimes? Perhaps the control stick is flaky in one particular direction? This is something where buying new buys piece of mind.
Let’s compare this to a prom dress. Unless a bunch of sisters or friends have shared dresses, it’s unlikely to have even been worn more than once, so wear is unlikely to be an issue. I think that changing styles is the larger problem. For whatever reason girls seem to be conditioned to want the latest and greatest style when it comes to prom dresses. The problem with Ebay is convincing them that what you are selling is stylish. A couple of pictures of a dress really cannot do it justice. If there was an easy way to PhotoShop the dress onto a celebrity I bet it would do wonders for Ebay sales.
What we can conclude from these examples is that some things tend to decline precipitously in value, immediately after purchase. On the same token there are some things which may actually increase in value or not decline much. For example, old high capacity computer memory can fetch a premium. The highest capacity module of a certain memory type(EDO, SDRAM, DDR, DDR2) is often quite valuable as people try to breath new life into old PCs, unfortunately the memory hasn’t been built in years and the only supply in the market is used and never sold modules in warehouses. Similarly the highest speed CPU that fits in a certain socket will continue to fetch a premium due to folks upgrading. On the flipside you have parts that will drop precipitously in value from day one. Generally the more you spend for a computer part the more it will depreciate. Consider things like high end video cards that go for $500 one day and are eclipsed in 6 months by a $200 card, that’s $300 you will never see again.
A while back I purchased a nice oak kitchen table with 4 chairs, used from a listing I found on Craigslist. This is a solid wood piece of furniture that probably cost $400 new. It was listed for $125, I offered a nice crisp $100 bill. It was funny because because the husband who was selling hm’ed and hah’ed over the offer for a few seconds, the wife then quickly said, “Sold.” I’ve gotten several years usage out of this table, yet it could probably be sold for the same $100 I paid for it.
The residual value is something to keep in mind when considering a purchase. One can have extremely nice home furnishings for virtually no long term cost simply by buying used. Certainly there is significant depreciation in buying new but not as much as things like clothes. Considering how much value you will get out of something and its residual value can go a long way in helping to make informed purchases.