REPOST: Treasures: Getting a handle on secure investments

While they may seem impractical, items such as designer bags, fine art, and jewellery can actually serve as good investments. Luxurious objects are often rare and are therefore highly sought by niche markets. More insights from

Matte-white Himalaya Niloticus Crocodile Diamond Birkin

Back in the early 1980s, the actress Jane Birkin was on a flight to London when she spilled the contents of her handbag. As she gathered her belongings, the passenger in the next seat suggested that she should have a bag with pockets.
She replied, presumably with gritted teeth, that when Hermès made a bag with pockets, she’d have that one. The man then announced himself as Jean-Louis Dumas, creative director of Hermès and the pair spent the rest of the flight designing Birkin’s ideal handbag.
According to Caitlin Donovan, handbag specialist at Christie’s in New York, the original design was sketched on the back of a sick bag.

Now, the Hermès Birkin holds the record for the most expensive handbag ever sold at auction. This May, a matte-white crocodile skin Birkin 30 with 18k white gold and diamond hardware sold for HKD 2,940,000 (€318,497) at Christie’s, Hong Kong. On November 29, the same auction house is selling another, similarly diamond-encrusted crocodile skin Hermès Birkin handbag (est €162,910 to €217,213).

Louis Vuitton Speedy 25

Handbags can be a serious investment. In January 2016, the online marketplace Baghunter published a study compared three different types of investments: the S&P 500 (an index that reflects the stock market); gold; and Hermès Birkin handbags. The research concluded that the handbags are by far the safest investment of the three as they’re not subject to fluctuations in the market.

Successful investment in anything requires knowledge, skill, and a keen investor’s instinct. These qualities are rare. So are Hermès Birkin handbags. You can’t just rock up and buy one. Only a few are made each year and there’s a six-year waiting list. It also helps to be a valued Hermès customer.
“Connections must be made and brand loyalty displayed before a Birkin is offered,” wrote Colleen Kane in an article for Fortune on June 23, 2015. “Or, if you have double the retail price to burn, you can hire someone else to source a bag.”

Handbag collecting combines luxurious objects with glamour, exclusivity, and a cloak-and-dagger aspect. It’s all very exciting. According to Monika Arora, founder of the online handbag boutique PurseBop, every serious aficionado has a Holy Grail Handbag (HGB). If your objective is to make money, the Financial Times (November 17, 2016) concluded that the best investment handbag was the Chanel 2.55 Medium Classic Flap Bag, which rose in value by more than 230pc between 2004 and 2016.
Paddy Coughlan of Designer Exchange, a shop that both buys and sells designer handbags, agrees that the Chanel Flap is a good investment. “If you’d bought one for €1,800 12 years ago, it would now be worth around €4,480,” he says. “We’ve had people buy one and sell it back to us a few years later. We’ve actually paid them to use it!”

There are also good returns on older handbags. Coughlan recalls a young woman who recently brought her grandmother’s vintage handbags into the shop. The old lady knew that the handbags were valuable. She’d been given them by her husband, who was a diplomat, in 1968 and she’d kept them very carefully. Before she died, she showed her granddaughter the collection.
“I’d like you to have these,” she said. “But I know you’re not that keen on handbags. Keep them if you want to. If you don’t, they’ll help put you through college.”

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