Are Luxury Handbags a Better Investment than Art?
Luxury handbags were once considered simply a high-priced gift up until some, from the likes of Hermès, Chanel and Louis Vuitton began slowly increasing their prices over the years, eventually reaching figures that now potentially make them worth an investment rather, than just something bought merely out of fancy. Making a financial investment means putting your money in places where it will have the prospective to increment over time and generate profit. However, in terms of luxury bag investments, very few of them increase in value unless they are the aforementioned brands. So can they really be considered a better investment than art these days?
When it comes to the topic of luxury handbags, they have been a very marketable, sought-after commodity for years, driving a consistent supply and demand between brand and consumer. Much like art, jewellery and antiques, the luxury handbag has become somewhat of a collectable investment, but does that place it in the same ranking as the other assets? From the Chanel Classic Flap to the Hermès Birkin, to some, specifically the fashion fanatics, the answer is a definite yes.
A luxury handbag’s potential to resell for more than it was bought for depends on the rarity of the bag, the market value and the designer label. This mainly works in favour of big brands like Hermès, Chanel and Louis Vuitton who offer timeless collections that never really go out of style. Bags by these brands have sometimes sold on popular resale sites such as Ebay, Vestiaire Collective and Grailed for over 40% their original selling price. Vestiaire recently saw its highest sale made yet after a very rare Hermès “Faubourg” Birkin bag sold for €158,000 on the platform last May. Its exclusive design was essentially unreachable as Hermès had only produced 50 bags of the Faubourg model in 2019, that were made solely for the brand’s VIP customers.
The downside, however, to purchasing luxury bags as investments, is that the ones that show a greater promise of guaranteeing profit are almost impossible to obtain. Depending on the exclusivity of the bag, there is likely to be a long waiting list for it, which can last from up to 4-10 years. The Hermès Birkin bag specifically, has played a renowned role for its waiting lists, making it even more difficult for celebrities to get their hands on one.
Ultimately, designer handbags as rare as those of Hermès can be purchased with a high chance of profit when resold, therefore placing them under the investment cluster. That’s not to say, however, that luxury bags as an investment do not have their drawbacks. The harder the bag is to buy, the more it is yearned for possession. And in the case of Hermès and its limited supply and long waiting lists, collectors are often prepared to pay 2-3 times the original selling price in order to get their hands on one.
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