Here’s why you should invest in a Hermès handbag

Outperforming investments in gold or the stock market, if ever there was a reason to splurge on that designer handbag, this is it.

The Luxury Handbag Report 2020, by Art Market Research, tracked sales at 12 major auction houses over the past ten years and documented the rise of the humble handbag’s collectability, with the Hermès Birkin taking centre stage. Published by the Times earlier this year, the report noted that over the past year artworks by Banksy rose by 23 per cent but this was trumped by the Birkin bag’s increase of 42 per cent. Not just art, the bag also outperformed other key collectables including whisky, fine wine, jewellery and watches. Sebastian Duthy, chief executive of Art Market Research said: “This is the fastest growing collectors’ area and it’s the first time that women are running the category.”

In 2019, the sale of just 3,700 designer handbags at auction houses around the world amassed a staggering £26.4 million. Such great performances have promoted auction houses to hold regular handbag auctions with Christie’s even offering a selection of the finest pieces available for immediate sale all year round.

While many may doubt the security of investing in designer handbags, the facts speak for themselves. Documented in the Wealth Report by Knight Frank, the FTSE and gold markets have increased by 39 per cent over the last ten years. Despite considered to be safe investments, the increase pales in comparison to the 108 per cent rise of the Birkin bag.

What makes the Hermès Birkin so special?

Since 1837, Hermès has been world renowned for their quality craftsmanship and there has been little change to that legacy.

Using carefully selected leathers and materials, each Birkin bag is hand stitched by an expert artisan. The process can take over 40 hours but it is worth it as the signature double-needle saddle stitch will never unravel, meaning the Birkin is built to stand the test of time.

Traditional handcraftsmanship in a mass production world is testament to Hermès’ value of quality over quantity. The lengthy process means that the production of Birkin handbags each year is limited but this drives exclusivity. In fact, you cannot simply buy a Birkin in store, rather the Hermès boutique managers will contact potential buyers individually. Because of this, the Birkin has become a highly sought-after status symbol and a must-have accessory for the rich and famous.

The origins of the Birkin are somewhat less glamourous. A chance encounter in 1983 saw actress Jane Birkin sat next to the then creative director of Hermès, Jean-Louis Dumas, during an international flight. Birkin who infamously carried around a wicker basket, complained to Dumas that she couldn’t find a bag big enough to comfortably carry all of her things. By the end of the flight, the Hermès Birkin was born, with all its glory sketched onto the back of a sickness bag.

Since then the Hermès Birkin has become the most collectable bag in the world with a 35 cm crocodile skin Himalaya Birkin, complete with diamond encrusted white-gold hardware, selling for an eye-watering $500,000 in 2019. 

Whereas new bags tend to lose value after the initial purchase, quality brands like Hermès and Chanel gain value with pre-owned pieces in good condition often selling for up to two and a half times their retail price. If you can’t get your hands on a Birkin don’t fret as the Kelly bag is a second favourite.

The Hermès Kelly bag

In 1930, Robert Dumas designed a bag that was “nothing fancy, just a neat, plain, functional bag intended for independent, energetic women.” Originally named ‘Sac à dépêches’, the bag became emblematic of the Hermès design.

Whilst the bag was popular from the beginning, it reached iconic status in 1956 with thanks to Grace Kelly. Paparazzi captured the star using her black leather bag to hide her baby bump. The photograph was seen by millions around the world and prompted endless requests from fans for their own ‘Kelly’ bag. 

While the appearance of the bag has been frequently reinterpreted, the iconic shape has remained the same and its timeless sophistication has continued to prove popular. Since 2010, the average value of Hermès Kelly handbags rose 129 per cent.

Experts say to stick to neutral colours and sophisticated tones such as rose pinks or ink blues with the most popular sizes being 28 and 32 cm. Christie’s currently lists an impressive collection of Kelly bags with prices ranging up to £30,000.

With the financial fallout from the coronavirus teaching us that we should invest our money wisely and luxury handbags taking precedence, we certainly don’t need to be told twice! Now where’s my purse…

By Holly Johnson

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