When considering various investment options like stocks, bonds, and property, designer handbags may not immediately come to mind. However, it is worth exploring their potential as a means of diversifying your investments.
Based on the research conducted by Art Market Research (AMR), handbags have surpassed traditional investment options such as art, classic cars, and rare whiskies in terms of their potential to generate returns. Over the past decade, luxury bags from renowned brands like Hermès, Chanel, and Louis Vuitton have witnessed an impressive increase in value, with an average appreciation of 83%.
In terms of context, the value of coins has risen by 21%, first-edition books by 42%, and watches, considered the primary choice for fashionable investments, by a significant 72%.
Based on the report, in 2019, an impressive sum of £26.4 million ($32.9 million) was generated from the sale of over 3,500 designer handbags at auction.
The highly sought-after item would undoubtedly be the Himalayan Birkin handbag crafted from crocodile skin, created by the renowned brand Hermès. This particular handbag has consistently been regarded as the most valuable and desirable in the world. It achieved a record-breaking sale in 2016, where a white gold and diamond-adorned Birkin fetched an impressive sum of 2.8 million Hong Kong Dollars, equivalent to approximately $372,600.
The top ten highest-priced Hermès handbags ever sold at auctions have exclusively been crocodile-skin Birkins.
The appreciation in value of the bag mentioned, although impressive at 93% over the past ten years, is not as significant as the increase seen in the value of the Hermès Kelly bag, which has risen by 129% during the same timeframe. In a similar vein, Chanel flap bags have experienced a remarkable increase of 132%.
For individuals with expendable assets, purchasing preloved designer handbags can be a lucrative investment strategy. The exclusivity and higher price tags of certain bags, whether due to limited availability or luxurious craftsmanship, greatly increases their desirability among collectors and investors.
It is evident that a significant number of individuals hold a strong attachment to their handbag assortments, often accumulating a substantial value reaching into the millions. These passionate collectors are resolute in retaining possession of their cherished bags and show no inclination to part ways with them.
For the foreseeable future, those involved in the buying and selling of designer handbags can benefit from the current situation where supply and demand are in their favour.
Despite the lock down restrictions, Christie’s recent designer handbag auction was a resounding success, with all items selling out and generating an impressive £1.34 million ($1.67 million) in total revenue.
The auction also included a Himalayan Birkin handbag featuring a crocodile design, which surpassed its estimated value and sold for an impressive £125,000 ($156,000).