Hermès Bags as an Investment: A Beginner's Guide
So, you’ve seen a few articles lately about how handbags are breaking records on the auction block, the market is going up, and some even say Birkin's are a better investment than gold, and in recent years have beaten the average of the S&P 500. But how can you get in on this? Is it really a safe assumption that you can take a chunk of cash, buy a few bags, and resell them a few years later for a healthy profit? In some cases yes, but not all Birkins are created equal. In this regard, the Handbag market is closer to the stock market; trends change, and while the Birkin and Kelly are timeless, different sizes and colors fluctuate in popularity as tastes evolve. Until five years ago, 35cm Birkins dominated the secondary market, now the 20cm Kelly is the most in demand. With all of this to consider, entering the Handbag market purely with the purpose of maximizing your investment may seem daunting, a gamble even, and it is. Huge amounts of money can be made and lost by accident, and the preferences of buyers can change on a whim. The most fulfilling way to participate is simply to buy what you love, Handbags of this caliber will always be a collectible over an asset; two people’s emotions in an auction room can set previously unthinkable records and move the market by leaps and bounds. But if you have extra ten, or fifty, or a hundred thousand dollars laying around and you’re looking to put it into handbags, here are my tips for investing that cash as safely as possible:
With $10,000, your best bet is to find a Birkin or Kelly that is vintage, in good condition with no major issues. You’re going to want to look for something in an unusual material, or with unusual hardware. These bags that have something slightly different about them are poised to go up in value much faster than an otherwise unremarkable leather bag. Good variations to watch for in this price range are bags with Guilloche hardware, canvas bags with interesting patterns (I would avoid the solid Toile, Officer canvas, and Crinoline, these are generally less popular and less valuable). Options you’re likely find are Mosaic, Potamos, and Jumping patterned canvases. If you see a Doblis Suede bag at this price, buy it, but only if it is all suede, avoid Grizzly bags which have leather detailing at the top, and avoid Ghillies bags with suede panels, as they are not very attractive or popular.
Another smart purchase you may be able to find for ten grand is a vintage 20cm Kelly, but be sure to find one with the round top-handle, rather than just the attached shoulder strap. Most of these are done in black calf box leather with gold hardware, so anything besides that is very unusual and worth grabbing. Calf Box leather is one of the easiest to refurbish, so don’t worry too much about scuffs or rubbing.
The best thing you could potentially get offered these days at Hermes for under $10K would be one of the new 20cm Mini Kelly II’s, which retail for about $7,000 USD, but as of this summer average at auction over $17,000 USD. These are extremely difficult to find in the stores and word is production has been further limited, so don’t hold your breath. If you do manage to find one within this budget on the market, though, that's still a good price to buy.
With $50,000 to invest, you have a few options: you can go all in on one great rare piece, you could go for two rare vintage pieces in the $20K range that have strong followings and already started climbing in value, you could seek out five of the bags from my previous recommendation, or you could pick up three or four regular pristine bags from the store and just sit on them for a few years and hope the market standard annual 10% hold strong.
I suggest splitting your pot and finding two bags that are legitimate rarities with a strong desirability factor. The two materials I’d strongly consider placing at the top of your wishlist are Doblis Suede and Lizard. These days you can still sometimes find 25cm Lizard Birkins and Kellys selling in the $20,000-$30,000 range, though the top of the market for these pieces has recently breached the $100,000 mark. All of the top results are achieved by Ombre Lizard bags which you’re very unlikely to find for under $50K, but examples in other colors have recently been poking above fifty thousand.
The rest of your budget I would put toward a Doblis Suede bag, but again, make sure it is all suede, handles and everything. These bags were born to wear, and the suede develops a serious patina with use. Suede Birkins and Kellys are so rare, any color is a good choice, so if you see one for under $25,000, I suggest giving it careful consideration.
If you’re looking to put something closer to a hundred grand into the bag market, basically you have the buying potential to buy any bag you might want (except for a diamond Hima). The bags that live around the entrance to the size figure club these days are growing in number. Solid color diamond Birkins and Kellys have steadily sold in this range on the auction market for nearly a decade, and don’t show any signs of climbing, so while a diamond Birkin may be a very flashy way to spend $100,000 (and the only type of Birkin or Kelly you can always find for well under retail on the market - the current in store price is hard to pin down but certainly over a quarter million for any size), a diamond bag will serve more as a lock box for you money, and is unlikely to make you any substantial profits.
Your safest bet with $100K would be to try and find a nice white Himalayan Birkin or Kelly, any size will do as long as the condition is good your money will be well spent. You may even be able to find the White Hima’s rarer cousin the Gris Cendre Hima at this price. Auction results over the last decade have shown us all Himalayan Birkins and Kellys are steady climbers, and with more and more leaving the auction block with prices topping $150,000, and sometime $200,000, its unlikely you’ll be able to find these bags around that six figure entrance for much longer.
Of course, if you’re uncomfortable putting all of your money into one handbag, you can cobble together a very smart investment worthy collection, a portfolio if you will, with any combination of the bags suggested here. Be sure you’re only buying from a trusted seller, and know that if you’re considering a rare bag, a few minutes searching for auction results of similar examples is time well spent. Most dealers have a little room to negotiate prices, but don't be insulting with a low offer, everyone knows this market is moving up, so things will work out best when everyone profits. Strong relationships with connected dealers can yield incredible rarities, but if you’re buying as an investment rather than for pure joy, take the time to know what you’re buying and understand it’s history in the market. The smartest investors in this market can multiply their investments many times over, but it takes a well honed eye to spot the hidden gems that will move the fastest. Everything I’ve suggested here should be easily found with a maximum few weeks of searching.