Dilute ferrofluids have important applications in the separation of materials via magnetic levitation. However, dilute ferrofluids pose an additional challenge compared to concentrated ones. Migration of the magnetic nanoparticles toward a magnet is not well counteracted by a buildup of an osmotic pressure gradient, and consequently, homogeneity of the fluid is gradually lost. Here, we investigate this phenomenon by measuring and numerically modeling time-dependent concentration profiles in aqueous ferrofluids in the field of a neodymium magnet and at 10 T in a Bitter magnet. The numerical model incorporates magnetic, frictional, and osmotic forces on the particles and takes into account the polydispersity of the particles and the spatial dependence of the magnetic field. The magnetic sedimentation rate in our most stable ferrofluids can be understood in terms of the magnetophoresis of separate nanoparticles, a best-case scenario when it comes to applications.