In the world of collecting unique items, investing in luxury handbags has become a significant trend, attracting both experienced and novice female investors. While we have a strong affection for handbags, the idea of buying them for profit might seem unusual when most people think of investing in things like stocks and shares. However, it’s interesting to note that the word ‘investment’ originally meant ‘to clothe’ in Latin. This suggests that these fashionable accessories could be some of the most suitable investments of all.
A senior investment manager, explains that for investors who already have a diversified investment portfolio, luxury handbags can be an appealing alternative option. She points out that alternative investments, like handbags, fine wine, yachts, and art, work differently compared to traditional investments. Research from Credit Suisse even shows that among these ‘collectible’ investments, jewelry, handbags, and watches are some of the most reliable choices.
Why Luxury Bags Make for a Smart Investment
Much like aged fine wines and artwork from the masters of old, vintage bags have taken center stage in the investment arena. Leading experts in the world of luxury handbags, including the founders of London’s premier pre-owned luxury goods boutiques, suggest that this surge in interest for collectible investments has been influenced, in part, by shifting consumer preferences.
According to the founder of GabyLuxxy, “More and more buyers are becoming conscious of the environmental impact of their consumption habits.” As the environmentally-conscious Generation Z gains more purchasing power, sustainability has emerged as a prominent element of brand narratives and marketing efforts. This places certain segments of the fashion industry, such as the pre-owned market, at an advantage due to their inherent sustainability.
She further emphasizes this point, stating, “The fashion industry is taking steps to reduce its environmental footprint, and purchasing second-hand handbags is an eco-friendly way to shop, as it minimizes waste and pollution.” She highlights that the surge in the second-hand shopping market can be attributed, in large part, to the ease of accessibility to these products. From online retailers to social sellers and even platforms like TikTok selling, vintage shopping has never been as convenient and within reach as it is today.
Which Luxury Bags Are Wise Investment Choices?
So, which luxury bags should you consider for investment purposes? GabyLuxxy affirms that, at her firm, the majority of inquiries revolve around what she calls “the holy trinity of brands: Chanel, Hermès, and Louis Vuitton.” Notably, the prices of Chanel and Hermès handbags typically see an annual increase of around 12 percent, making bag investments more financially rewarding compared to other assets.
Hermès, in particular, frequently finds itself at the center of discussions about “investment bags,” thanks to the deliberate rarity and limited availability of its products. The economic principle driving this is straightforward: supply versus demand. As Hanushka Toni, co-founder of Sellier Knightsbridge, elucidates, “Chanel and Hermès are the most coveted brands in this category, and their value stems from the scarcity of supply combined with tremendous demand in the resale market.”
In 2022, Business of Fashion projected that the luxury leather goods industry would reach a value of $100 billion by 2027. During lockdowns, searches for Hermès bags surged by a remarkable 430 percent. While there may be no official waiting list to purchase a new Hermès bag, it’s not uncommon to hear stories of fortunate owners who patiently waited for years to acquire one. This dynamic creates the perfect recipe for an investment-worthy handbag.
The outcome? Not only is acquiring a second-hand Hermès bag more attainable, but it’s also financially astute. A study conducted by Deloitte and Credit Suisse in 2020 revealed that Hermès Birkin bags yielded an average return of 38 percent, marking the highest return among all collectible assets. In 2018, an exceptionally rare Himalaya Birkin bag fetched a record-breaking €189,000 at an auction. These figures make the average pre-owned retail price of around €10,000 appear quite the bargain.
Gucci Attaché
Reminiscent of styles popular in the 1970s, Gucci’s curved bag falls into a category of silhouettes that is reportedly on the rise. “Crescent and half-moon shaped bags have been and are certainly still trending,” McSweeney shares. “Looking at the second half of 2021 versus the same 2022 time period, we saw a 67% uptick in demand for the shape. We’re seeing strong demand for Gucci’s re-issued Attaché.”
Hermès Kelly 28
If there was ever a shoo-in for the best investment handbag list, it’s the Hermès Kelly 28. Originally designed in the 1930s by Robert Dumas, the son-in-law of the fashion house’s former president Émile Hermès, the Kelly is the most original Hermès bag (yes, it even came before the Birkin).
Louis Vuitton Neverfull
Making a comeback of its own, Louis Vuitton’s most iconic tote was recently praised by Vogue writer Liana Satenstein as a perfect executive tote. In her words, “The standard investment piece has an air of killer executive realness. It means business.”
Chanel Classic Mini Flap Bag
Originally designed in 1955 by Gabrielle Chanel, the Classic Mini Flap Bag is the epitome of an accessory that has stood the test of time. In fact, according to The RealReal, it still flies like hotcakes. “The iconic Flap Bag is a consistent best-seller,” shares McSweeney. In the past decade alone, this bag’s value has increased by 100%.
Jacquemus Chiquito Bag
A crowd favorite, Jacquemus’ signature handbag has undoubtedly made waves in the fashion world. Since launching in 2018, it has made runway cameos in nearly all of Jacquemus’ shows and is carried by Bella Hadid, Kendall Jenner, Rihanna, and more stylish icons. According to the team at The RealReal, this mini bag is only becoming more valuable with time.