There are two basic signs that tell us how to determine the quality of a rug:
1) Small, tight knots and a fine pattern with a clear design on the front as well as on the back of the rug.
2) The wool should feel oily, and full of lanolin.
Handmade rugs are more valuable then machine made. The back of the rug will help you determine whether it is a handmade rug or machine made.
A handmade rug has the same, vibrant design as the front of the rug. The more knots per square inch and the more intricate the design, the more valuable the rug.
Silk rugs are the most expensive rugs on the market. In addition, when examining antique rugs other factors enter in. Originality, rarity and overall condition are important factors.