Market Update 2018: San Francisco Gold Coinage

I don’t write as often about San Francisco gold coinage as I do about the southern branch mints, but I buy and sell a lot of rare San Francisco issues in all denominations and I have a good overall handle on the health of this market. Since I have no interest in ever writing a book on San Francisco gold (I’ll leave this project to someone else…) I think it only fair to provide the occasional long-format article.

Before we look at specific denominations and types, let’s make a few “big picture” overviews.

1. Significant Hoards of SF Gold Are Impacting the Market

With very little fanfare, a large amount of San Francisco gold began entering the market around two years ago. At this point, the biggest impact has been on double eagles and nearly every date with the exception of the rarities (1854-S, 1861-S Paquet, and 1866-S No Motto) has seen a dilution of prices as the result of increased supplies.

While many of these coins are average circulated (EF to mid-range AU), there are some dates which have seen an influx of nice Uncirculated coins in grades as high as MS62 to MS63. It is interesting to note that the majority of the coins I have seen—regardless of grade—have been really choice with attractive natural color. Kudos to the dealers involved with distributing these coins as they’ve left them crusty as opposed to making them bright and shiny.

  1876-S $20.00 PCGS MS63+ CAC

1876-S $20.00 PCGS MS63+ CAC

The series which has seen the greatest impact are Type Two double eagles; especially those dated 1869 through 1876. There have also been some high-quality (MS63 and MS64) Type Three issues; especially those dated 1883 through 1900.

Smaller denominations (gold dollars through half eagles) do not seem to be included in these hoards. Liberty Head eagles are present but seemingly not in any significant quantity. From what I have seen, if any design type of this denomination will be impacted, it will be the With Motto issues—and mainly those dated 1880 and later

2. The Second Wave of S.S. Central America Gold Has Also Entered the Market

2018 will be remembered numismatically for a variety of reasons. One of the major stories was the release of the second wave of S.S. Central America gold coinage.

As expected, there were numerous Choice and Gem 1857-S double eagles in this second group. What were not as expected were a small number of incredible high grade 1856-S and 1857-S gold dollars, quarter eagles, three dollars, and half eagles. An example of this bounty was an 1857-S $3 graded MS67 (!) by PCGS.

From what I’ve seen so far, the higher end San Francisco gold coins from SSCA #2 have sold reasonably briskly while the more mundane coins—as one might expect—have sold more slowly.

Will these coins have an impact on the collector market for San Francisco gold? This is a difficult question to answer. The impact of SSCA #1 was huge; at least as far as creating new collectors of Type One double eagles. This time around, will the buyer of, say, an MS66 1857-S double eagle be compelled to begin a set of high quality double eagles?

3. A Newly Discovered 1854-S Half Eagle Has Set a Price Record for any SF Coin

The mysterious discovery of a fourth specimen of the 1854-S half eagle was met with considerable fanfare when it was announced early in 2018. The coin was authenticated and graded EF45 by NGC.

  1854-S $5.00 NGC EF45, courtesy of Heritage

1854-S $5.00 NGC EF45, courtesy of Heritage

This coin was later consigned to Heritage Auctions and it brought $2,160,000 as Lot 5248 in their 2018 ANA sale.

I was as surprised as anyone regarding the discovery—out of the woodwork—of this coin. While only 268 were made, I’ve always thought it was unusual that a few more hadn’t survived. My best guess was that one or two would be found in the S.S. Central America cargo but none were present (nor were there any of the extremely rare 1854-S quarter eagles).

I think the price realized was a bit of a disappointment. I expected the coin to bring closer to $3 million, but two factors worked against it: the coin wasn’t really attractive and the circumstances behind its discovery were murky enough to not garner the attention of buyers outside of the small pool of known specialists who could afford such a piece.

Now let’s take a look at each denomination of Liberty Head gold coinage from the San Francisco mint and analyze current market trends.

GOLD DOLLARS

The market for high grade San Francisco gold dollars was jump-started by the sale of the Steve Duckor Collection in the 2015 ANA sale. Record prices were set for the 1854-S, 1858-S, 1860-S, and 1870-S (later broken by the Simpson Collection coin in December 2015). Collectors have become more appreciative of the rarity of the seven issues from San Francisco, and whenever I offer a nice Uncirculated San Francisco gold dollar it sells quickly.

The market for collector grade San Francisco gold dollars is reasonably robust, although buyers tend to be very picky. Properly graded coins—especially those graded by PCGS and approved by CAC—are easy to sell and show strong demand.

  1870-S $1.00 PCGS MS62 CAC

1870-S $1.00 PCGS MS62 CAC

The date which seems to be in highest demand is the 1870-S. This is a popular “outlier” issue as it was the only gold dollar from this facility made after the Civil War. It is scarce enough to be challenging but it is available enough to not scare off potential buyers.

QUARTER EAGLES

I’ve noticed a surge in popularity for this denomination in the last two years and the demand for nice San Francisco quarter eagles has shown an upward trend.

The most popular San Francisco quarter eagles remain the four Civil War issues (1861-S, 1862-S, 1863-S, and 1865-S). These are popular in all grades. New prices records were set for the 1861-S (in 2016) and the 1865-S (in 2018), and high-grade examples of the scarcer Reconstruction Era dates have sold for strong prices in their most recent auction appearances.

  1854-S $2.50 PCGS VF35

1854-S $2.50 PCGS VF35

The extremely rare 1854-S is an issue which deserves a paragraph or two of its own. Since 2013 there have been just three auction appearances representing two distinct coins. One—the lowest graded piece known—brought an extremely strong $193,875 in March 2014. The second—graded VF35 by PCGS—sold for $264,000 in April 2018 after realizing $282,000 in November 2013 (full disclosure: I was the buyer of this coin in 2013).

Admittedly, three APRs in five years is a very small sample size. In my opinion, the March 2014 APR for the low grade 1854-S was about 25% higher than it should have been. The April 2018 APR was lower than I expected, and this is likely attributable to two factors: first, there were no major collectors who currently needed an 1854-S for their quarter eagle sets and second, the coin in question had some pin scratches which may have been a turn-off to perspective buyers.

Excluding the 1854-S, the San Francisco quarter eagle set consists of just 21 different coins and this is a readily completable set. I anticipate demand by set collectors to increase in the next few years and I feel that most San Francisco quarter eagles remain excellent values at current levels.

THREE DOLLARS

The market for high-grade San Francisco three dollars (and this denomination in general) was jump-started by the sale of the Pogue/Great Lakes Collection by Stack’s Bowers in their February 2016 auction. Record prices were set for the 1856-S and the 1857-S (later broken by private treaty sales of finer coins from the S.S. Central America).

Interest in Three Dollar gold pieces was frosty—to say the least—from 2006 to early 2016. The sale of the Pogue Collection, coupled with the presence of some great San Francisco Threes in the S.S. Central America, has made this series more popular than at any time I can remember in over a decade.

  1856-S $3.00 PCGS MS64

1856-S $3.00 PCGS MS64

Not including the unique 1870-S in the Bass Collection, there are just four Three Dollar gold pieces from the San Francisco mint. None of these is rare in circulated grades although the 1855-S and the 1860-S are challenging to locate in the higher AU grades with choice original surfaces. All of these dates—even the semi-available 1856-S—are rare to very rare in Uncirculated.

I expect demand to remain steady for these issues but the really nice survivors—whether they grade Extremely Fine or Mint State—should see greatly increased demand in coming years.

HALF EAGLES

If I had to select the denomination of San Francisco Liberty Head gold coinage which has the most upside potential I’d unhesitatingly select the No Motto half eagle issues (produced from 1854 through 1866) and the early run of With Motto half eagle issues (1866 through 1876). These coins aren’t exactly inexpensive but for collectors who can afford to spend $10,000-20,000+ per item, they can find truly rare items which qualify in the Condition Census. Clearly, this series offers a lot of bang for the buck.

  1864-S $5.00 PCGS AG03 CAC

1864-S $5.00 PCGS AG03 CAC

The most popular San Francisco half eagles—to no one’s surprise—are the five Civil War issues. The rarest of these is the 1864-S. I recently sold a PCGS/CAC AG-3 and I was surprised at the interest this coin generated. I lost count at eight different orders and this is a coin which I had priced at more than double the PCGS Price Guide for a Good-4.

The dates which, in my opinion, still offer the best value for collectors of San Francisco No Motto half eagles include the 1858-S and the 1861-S. I have sold solid Condition Census examples of both of these issues for around $12,500-15,000 and these are dates which are essentially unknown in Uncirculated.

There are no true rarities in the With Motto half eagle series from San Francisco and it is a feasible challenge to attempt this set in the AU-Uncirculated range. The two keys are the 1866-S Motto and the 1876-S.

Despite the rarity and affordability of these two design types, I regard the San Francisco half eagles to be underappreciated and comparatively underpriced. This could change, however, in the next few years.

EAGLES

In the 2000s, Liberty Head double eagles—especially the Type One issues—were the series du jour in Liberty Head gold. In the late 2010s, I’d place this honor on Liberty Head eagles—especially the No Motto issues.

No Motto eagles were produced at three mints: Philadelphia, New Orleans, and San Francisco. Of these three mints, the coins from San Francisco show the greatest across-the-board rarity.

  1856-S $10.00 PCGS MS61

1856-S $10.00 PCGS MS61

The only two San Francisco eagles of this design which are available with any degree of regularity are the 1854-S and the 1856-S, and even these are very rare in Uncirculated. Most of the other dozen range from very scarce to very rare and virtually all are nearly impossible to locate in Uncirculated.

The most popular No Motto San Francisco eagles are the six Civil War issues. The rarest single issue is the 1864-S which I rate as the rarest collectable gold coin from this mint and one of the two rarest dates in the entire series along with the 1875.

  1864-S $10.00 NGC AU55

1864-S $10.00 NGC AU55

Other No Motto eagles from San Francisco which I would call your attention to if you are mulling this series include the 1860-S, 1865-S Normal Date, and the 1866-S No Motto. This trio is very rare and will present the specialist with real challenges in obtaining nice examples.

The With Motto eagles from San Francisco have proven less popular than their No Motto counterparts and this is due to the fact that there are a number of mundane issues produced after 1878. I personally look at the With Motto type as two entirely different collecting challenges: the 1866-1878 dates which are mostly rare in AU and virtually impossible in Uncirculated, and the 1879-1907 dates which exist in quantity—for the most part—in grades up through MS63. It is important to note that the hoards mentioned at the beginning of this article do include quantities of later date San Francisco eagles which will no doubt impact populations and prices on higher grade.

I would rate the current market for No Motto San Francisco Liberty Head eagles as very good. The Admiral Collection (sold by Heritage in February 2018) contained a number of important individual coins and a number of records for individual dates were set in 2016 and 2017 auctions. I don’t think this market can support more than a few active collectors at any given time based on the small supply of nice coins. The market for With Motto San Francisco Liberty Head eagles is more of a mixed bag. The scarcer issues from 1866 through 1878 show some strength, but I feel these are still underappreciated in comparison to their 1854-1866 counterparts. The 1879-1907 issues seem ripe for a well-managed promotion given the relative availability of nice coins.

DOUBLE EAGLES

There has probably never been a better time to start a collection of collector quality San Francisco double eagles. There are significant quantities of exceptional coins in the market and price levels—for certain dates—are the most favorable they have been for many years. Let me give you an example. In 2016, you’d have to spend $3,250-3,750 for a nice 1855-S graded AU55 by PCGS. Today, an 1855-S in PCGS AU55—not CAC approved but still crusty and pleasing—is likely to be $1,000 cheaper. This is true with other Type One dates such as 1858-S, 1859-S, 1860-S, and others.

  1860-S $20.00 PCGS AU55 CAC

1860-S $20.00 PCGS AU55 CAC

How should one value truly scarce San Francisco double eagles in a market characterized by increased supply and decreased demand? The 1854-S in AU55 offers an interesting case study. In 2018, there have been three really nice PCGS AU55s—none with CAC approval—and prices have held firm at $19,200 (3/18), $19,200 (6/18), and $21,600 (8/18). This proves there was enough demand for this date in this grade for prices to remain stable. But what about the next three nice PCGS AU55s—if they exist?

The Type One market seems a bit less impacted by hoards than the Type Two and Type Three markets due to a larger collector base.

  1871-S $20.00 PCGS AU58 CAC

1871-S $20.00 PCGS AU58 CAC

Type Two double eagles from San Francisco were less popular than their Type One counterparts, and an influx of nice coins has softened prices by 10-30%. I anticipate collector and dealer support as levels become irresistible. As an example, a date like the 1871-S in AU58 now sells for just a small premium over a common issue; I have seen decent ones trade for $1,400-1,500. A few years ago, these brought over $2,000.

  1880-S $20.00 PCGS MS61

1880-S $20.00 PCGS MS61

The Type Three market will require careful scrutiny for potential new collectors. Dates such as the 1879-S, 1880-S, and 1881-S—where there are huge price differences between MS61, MS62, and MS63 grades—could see adverse reaction if an influx of nice coins from Europe continues. I’d advise working with a seasoned dealer who is able to identify the best value grades for each issue.

The market for San Francisco double eagles is likely to be more investor and marketing-driven than the other denominations from this mint. This makes sense given the relative availability of these coins, their large size, and the neat back story behind each of the three denominations. I don’t view this as a negative at all but one must remember that no marketer is going to focus on coins like No Motto eagles when so few coins are available.

I like the potential for an increase in demand for the San Francisco gold market in the coming years. These coins were under-appreciated for years and it seemed inevitable that collectors—and dealers—would focus on this alternative to the Southern branch mint/Carson City coins which have been the “go to” choice for most dated gold collectors since the 1970’s.

Let DWN help you assemble a world-class collection of San Francisco gold coinage. Contact us by email (dwn@ont.com) or by phone/text (214-675-9897).