How to invest in handbags, the luxury most likely to hold value

by MARK ELLWOOD

WITH the stock market roiling, luxury goods — especially designer handbags — are becoming a hotly sought-after investment commodity. One July study from the Business of Fashion said 40% of US consumers had bought or were planning to buy one, helping bolster the category from a global market of US$72 billion (RM320.87 billion) this year to a predicted US$100 billion in 2026.

Buy them to store and trade, rather than tote, and that as-new purse could offer an impressive return on investment (ROI): In June a study from Credit Suisse Group AG showed that Chanel bags rose in value 24.5% from the previous year. Those by the house’s late designer Karl Lagerfeld are especially coveted.

The entire luxury bag sector was singled out, over other categories like cars or wine, for its risk-reward proposition. Handbags, Credit Suisse says, had annualised volatilities of 2.5% to 5%, with mid-single-digit returns.

They aren’t going to replace your BlackRock exchange-traded funds — retail prices can range from about US$2,000 for an entry-level Balenciaga bag to more than US$50,000 for some of the rarer, exotic-skin Birkins made by Hermès. But they offer an opportunity for investors at many levels to get into a fun game.

(An August study by resale website TheRealReal reported that Gen Z and millennial shoppers make up 41% of its customers, with Gen Z the age group fastest to buy and try to turn items around quickly to make a profit.)

We canvassed the world’s best secondhand bag dealers, asking for recommendations for investment-worthy totes in two categories: First, a bag that’s already proved bankable on the secondary market; and second, a bag you can find in retail boutiques right now that the experts expect to offer impressive returns in the future.

To get the best price, which is well above average, a bag must be in absolute mint condition, preferably with tags on. And to increase in value, rather than just hold it, a bag must have been rare at retail — sold in limited quantities or made from a sought-after material.

Two experts recommend the Hermès So Black Birkin, a Jean-Paul Gaultier-era limited edition in which both hardware and leather are black – pic source: Heritage Auctions

So Black Birkin

Money’s In the Bag: Two experts recommend the Hermès So Black Birkin, a Jean-Paul Gaultier-era limited edition in which both hardware and leather are black.

“It’s seductive, the way it draws you in,” swoons Diane D’Amato, director of luxury accessories, private sales and boutique at Heritage Auctions Inc. Judy Taylor, president and CEO of reseller Madison Avenue Couture, advocates for it because none of the So Black designs have been reissued.

Price: A So Black in crocodile fetched US$208,000 three years ago. Taylor says a 35cm So Black Matte Alligator Birkin in mint condition can go for US$175,000. This year, she sold a never-used So Black Birkin 30cm from 2011 for US$75,000.

Goyard Plumet Pocket Wallet

The Stuff of Potential: Step inside a Goyard store today and you’ll be politely asked not to take any photos. “The associates aren’t allowed to send you pictures either,” D’Amato says. “The brand ensures its exclusivity with almost no advertising, no e-commerce and very few stores in select cities.”

The best investment piece, she says, is a Plumet Pocket Wallet first introduced in 2018 that can also be worn as a crossbody bag.

Price: It started at US$1,080 then and has already reached US$1,310 at the store, with most Goyard models holding about 111% of their value, according to D’Amato’s calculations: “Goyard has a substantial ROI, and I foresee impressive growth moving forward.”

Gucci Jackie

Money’s In the Bag: Kate Moss, Harry Styles, and everyone else has carried the 1961 hobo-style model made famous as a paparazzi shield by the former first lady in the 1970s. It’s been reinterpreted by Gucci creative directors including Tom Ford, Frida Giannini and Alessandro Michele.

“It’s the perfect investment piece,” says Sophie Hersan, co-founder of Paris-based online consignment store Vestiaire Collective SA, which operates in more than 50 countries. “Most vintage Gucci bags have plus-100% retention values.”

Price: Resale site Rebag, which tracks historical prices, estimates a medium Gucci Jackie 1961 Hobo in GG Supreme Canvas runs US$2,320 to US$2,575. New, it now starts at US$2,850.

The limited edition Louis Vuitton Monogramouflage Speedy was part of the multiyear collaboration between Japanese artist Murakami and then creative director Marc Jacobs – pic source: sothebys.com

Louis Vuitton Monogramouflage Speedy

Money’s In the Bag: It was part of the multiyear collaboration between Japanese artist Takashi Murakami and then creative director Marc Jacobs, and limited distribution has helped the bag soar from US$1,530 to more than US$7,000 in the last 14 years.

“The Marc Jacobs era is a time when LV seemed to come alive,” says Lara Osborn, senior procurement director of reseller Fashionphile Group LLC, which opened a huge space in New York this spring. “This is unisex, utilitarian and camo is like leopard, in that it can be pulled off as a neutral.”

Price: The resale website Grailed lists a good-condition Louis Vuitton Monogramouflage Speedy 35 for US$7,650.

Fendi Baguette

The Stuff of Potential: The trend toward re-editions means everything old is new again — especially handbags. “It’s the increasing popularity of Y2K culture in the Gen Z market,” says Hanushka Toni, co-founder of London-based online reseller Sellier Ltd. “Bags that were released in the past are being launched again, often in new materials or colourways.” Her standout future investment among these is the Fendi Baguette, that “Sex and the City”-toted staple, ideally in lilac-coloured sequins.

Price: A new Baguette 1997 in lilac sequins, featuring a matching, satin-lined internal compartment, is available on the Fendi website for US$4,300.

The Kelly started out as the Sac à dépêches in the 1930s, but earned its nickname after Princess Grace Kelly famously used one to hide her baby bump in 1956

Hermès Kelly

Money’s In the Bag: The Kelly started out as the Sac à dépêches in the 1930s but earned its nickname (and, later, official moniker) after Princess Grace Kelly famously used one to hide her baby bump in 1956. Vintage models can now fetch as much as US$60,000, according to Vogue stylist Clare Richardson, who recently started the consignment platform Reluxe.

She says her current favourite is the Kelly Sellier in Epsom leather. It’s finely grained but also scratch-resistant; it cost US$10,300 new in 2021. The colours to hunt down are black with gold hardware or the brownish étoupe, also with gold: “They’re easy to style — and timeless.”