Department store high jewelry (luxury jewelry) sales have surged since the war between the United States and Israel and Iran. The retail industry interprets this as some lump-sum money from asset holders who lost places to go due to the war flowing in.
According to the retail industry on the 13th, the March high jewelry sales growth rate at the three major department stores—Lotte, Shinsegae, and Hyundai Department Store—averaged 59.6% from a year earlier. Shinsegae Department Store's growth rate was 68.3%, Hyundai Department Store's was 56%, and Lotte Department Store's was 55%. Considering that the average year-over-year sales growth rate for the high jewelry category that entered the three major department stores for all of 2025 was 33%, this March's growth rate stands out.
High jewelry brands that commonly saw large sales increases at the three major department stores were Van Cleef & Arpels, Cartier, and Bulgari. Prices for precious metals from high jewelry brands vary widely, from 3 million won to tens of millions of won. Precious metal pieces called entry-level jewelry are in the 3 million to 7 million won range, but high-priced precious metals usually run from tens of millions to hundreds of millions of won. Typically, even to buy a single necklace, one has to pay about 100 million won.
The retail industry points to, domestically, the selling of dwellings by multiple-home owners and, internationally, the war between the United States and Israel and Iran as the background for increased high jewelry sales. As people sold homes and did not immediately convert the cash in hand into real estate or stock purchases, some of it went into high jewelry during the wait.
Recently, President Lee Jae-myung has been working to stabilize the real estate market. The government ended the grace period on heavier capital gains taxes for multiple-home owners and decided to temporarily relax the move-in requirement, which had been four months, when a person without a home buys a property from a multiple-home owner. Multiple-home owners had been selling their homes one by one to buy a so-called "one smart home," but recent policies leave little time to do so. That is why proceeds from selling dwellings are not flowing straight back into the real estate market but are first being parked as waiting funds in the financial sector.
A real estate industry official said, "As recently as a year ago, the market centered on one-home owners trading up, so money from selling a dwelling went right into buying a new home, but that movement isn't common now," and added, "Commercial real estate such as retail spaces has long lost buying interest amid the economic downturn, so most funds seem to be flowing into the stock market and elsewhere."
However, even funds flowing into the stock market are not immediately turning into stock purchases and are waiting on the sidelines. That is because price swings in U.S. and Korean markets have widened due to the Middle East war's aftershocks. As of the 6th, balances in securities firms' cash management accounts (CMA) stood at 111.1219 trillion won. That is about a 7% increase from the average balance of 103 trillion won in February. CMAs allow free deposits and withdrawals and pay interest even for a single day of investment, so they are categorized as stock market waiting funds.
A luxury industry official said, "Compared to March last year, the number of sales of high-priced jewelry above 50 million won has increased significantly, rather than entry-level jewelry," and noted, "It appears that part of the lump-sum cash has gone into buying jewelry containing gold and rare gemstones."
High jewelry is strongly viewed as a work of art that concentrates rare, high-priced gemstones and the craftsmanship of artisans. Because it signals social status, purchases are made for investment or collection, and depending on the item, the value does not fall over time or even rises. This is why high jewelry is called "real estate the size of a fingernail." A retail industry official said, "It appears consumption is also taking into account its use as a means of inheritance and gifting that does not incur taxes."