Good time to sell gold, but beware some buyers and tread cautiously

The price of gold has more than doubled since Armando De la Fuente and his partner opened their Mission pawnshop in April 2007.

The number of customers coming in to sell their jewelry and heirlooms has doubled, as well, De la Fuente said, much as it has across the country.

“I’ve been seeing a lot of people going through their small jewelry boxes, looking for odds and ends, broken pieces, twisted chains and not realizing the amount of value that’s in there,” said De la Fuente, who co-owns Cash Solutions in Mission with his partner, Andy Flores.

Investors have increasingly put their money into safer investments like gold as the economy has soured, said Ansley Chua, a finance professor at the University of Texas-Pan American. The dollar’s falling value has also pushed up gold prices.

The price of gold was around $650 an ounce in April 2007 when De la Fuente was first opening up shop in Mission. Gold prices have hit record highs 14 times within the past two months and closed at $1,146.80 an ounce Friday on the Comex division of the New York Mercantile Exchange — about a 57 percent increase over the past 18 months.

“If you purchased something six years ago or even further back, you can actually sell it at a decent profit,” said Roy Robeles, a manager at Regency Jewelers in McAllen. “Most people have heard on the news that gold is at an all-time high and they think this would be a good time to unload it.”

While it may be one of the best times to sell jewelry, the high price has also saturated the market with scammers and made it more difficult to get a fair price, said Monica Russo, an investigator for the Better Business Bureau of Greater Houston.

Russo said it is best to work with local jewelry stores or pawnshops rather than mail-in, Internet-based companies.

Despite the popularity of Cash4Gold.com, for instance, Russo said there have been 294 complaints lodged against the West Palm Beach, Fla.-based company in the past three years. A majority of the complaints allege the company failed to live up to its contract, she said.

“The (Rio Grande) Valley has quite a few reputable people selling gold for a number of years,” Robeles said. “I don’t see any sense for people to send it to Florida or New York.”

But more businesses have begun buying gold as the price has spiked, as well. De la Fuente said he has seen about 10 locations pop up in the past two years, some of which are no longer in business.

“Make sure it’s a place that’s been in business for a while,” he said.

Russo recommended shopping around at several stores to compare prices. She also said to remove any precious stones from jewelry before trying to sell, because some buyers do not account for them when making an offer.

Most consumers also do not realize that, even though their gold is priced per ounce, it’s also checked for purity, Russo said. Most jewelry is around 10 or 14 carats, which is approximately 59 percent gold.

De la Fuente also recommended separating the pieces of jewelry when presenting them to a buyer.

If you present them all at once, he said, it’s easier for a buyer to “play it safe and say they’re all 10 carat.”

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The Associated Press contributed to this report.

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Nick Pipitone covers McAllen, PSJA, the Mid-Valley and general assignments for The Monitor. He can be reached at (956) 683-4446.