Chanel and Birkin bags continue to stand the test of time as demand for these luxury accessories continues to hold steady, making them a surprisingly great investment. But did you know that they are an even better investment than gold or playing the stock market? Learn why here!
While many women yearn to own an iconic designer handbag, their hefty price tags can often be daunting. After all, the average price of a Chanel Flap is $5,000, while an Hermes Birkin can set you back anywhere from around $9,500 up to nearly $40,000. However, if you are trying to convince yourself (or your significant other!) that splurging on one of the most coveted accessories around the world is a good idea, here is a good argument: they are a surprisingly great investment.
One recent study conducted by online retailer Baghunter claims that a Hermés Birkin is a better investment than gold or playing the stock market. After comparing the returns of the bag vs. the S&P 500 and gold over a 35-year period, they discovered that the value of these coveted purses have increased more than 500 percent during this time period. In fact, while the S&P 500 and gold went up and down over the years, the Birkin never decreased in value.
Graham Wetzbarger, chief of authenticity at the luxury online consignment retailer TheRealReal, confirms to us that bags such Hermés’ Birkin and Kelly hold their value to due their exclusivity. “Rareness is calculated by age, color, material and condition,” he explains. “There are 40 shades of Hermes blue, with some shades costing $3,000 more compared to others.” However, Hermes bags lose their premium with age, with even a year causing a sizable difference in cost. That being said, Birkins and Kellys regularly sell for over the manufacturer’s suggested retail price.
Others, such as classic, continuous styles from Louis Vuitton (such as the monogram canvas) and Chanel (like the caviar leather) hold their value, even though the brands raise their retail prices about 10% annually. Therefore, these bags may make a great investment as well.
Another great investment in 2018-2019: a bag with a logo. TheRealReal just released their 2018-2019 Mid-year Luxury Resale Report, which demonstrates that iconic, logo-centric bags by heritage brands are rising in retail value. This includes the Dior Saddle Bag (+89%), Gucci Web (+51%), Fendi Zucca (+32%) and Louis Vuitton Montsouris (+26%). “With this logomania in demand, these bags in particular are holding value well at the moment,” Wetzbarger explains.
The good news is, to maximize investment potential, you don’t have to walk into one of the designer’s stores and pay retail for a bag. Wetzbarger suggests acquiring items that are priced well below market value by purchasing them on sale or by thrifting. “Furthermore, copping limited edition pieces or buying an item from one market and selling it to another with a larger demand could have a great payoff. However, keep in mind that time is money,” he adds.
Timing is also a very important component when seeking the maximum return for your item. “You want to sell while your item is still in good condition, while it’s still relevant on social media, and while it’s popular amongst your circle of fashionable people,” he explains. A good way to measure timing is to search consignment websites such as The RealReal for like styles and note the cost and speed that items are being sold. “You can track specific items using the ‘obsessions’ feature, which keeps a customer’s favorites in one place,” he says. “If you see that same style being discounted at retail, you’ve missed the best window.”
But don’t forget to buy a bag that you love and will enjoy carrying around until you are ready to flip it. Also, don’t waste money. “If something isn’t worth full price, wait for it to go on sale,” he adds. “If something has minimal resale value, take that into consideration.” But at the very least, always keep in mind when making a big splurge —knowing your covetable item will sell for a great return takes the sting out of spending big bucks! ■
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