Are luxury bags really a good investment? 7 expert tips, from buying legacy brands like Dior, Chanel and Hermès, to diversifying your portfolio with Rolex, Patek Philippe – yes, and stocks and bonds

Apr 26 , 2023

A model carries one of the most valuable handbags in the world, a matt white Himalaya Niloticus crocodile diamond Hermès Birkin with 18k gold and diamond hardware. Photo: AFP

Luxury fashion items like handbags, jewellery and watches have seen their value grow over time, prompting investors to investigate their potential – but don’t sell all your stocks just yet

Classic Chanel Flap Bags and Hermès Birkins tend to appreciate in value, but expect to pay more upfront – and if in doubt on what to choose, try timeless staples and neutral colours

In the past decade alone, the price of a classic Chanel bag has risen by 100 per cent, making it an even more sought-after item not just for fashion fans, but for investors as well.

In fact, its price growth has outperformed both the stock market and gold, and shows no sign of slowing down. And it’s not just Chanel – other designer bags, jewellery and watches are all growing in price as time goes by.

A Chanel leather bag is attractive not only to fashionistas, but investors, too. Photo: Chanel

So should we invest in luxury bags? Not necessarily, according to the experts.

“In most cases, the answer is no,” says Thomas Kralow, professional investor, financial markets expert and founder of an online learning platform for traders and investors. “The second an item is used, its value instantly begins to decline. Even if kept untouched, the price of a bag can be influenced by changes in fashion trends, consumer preferences, and the state of the economy.”

Legacy fashion brands such as Chanel are more likely to retain value. Photo: Shutterstock

Kralow continues: “Plus, the market for luxury bags is highly speculative and subject to fluctuations, so unless you have a highly desirable product made by a legacy brand, predicting whether it will retain its value over time is impossible.”

But that seems to be changing slowly in recent years. “The situation has changed, with legacy brands having increased their prices dramatically. Higher price tags typically mean fewer are sold and, with time, this scarcity pushes up resale prices,” he added.

Christina Ricci attends HBO’s Official Golden Globe Awards After-Party at Circa 55 Restaurant in Los Angeles, California, in January 2019. Photo: AFP

Over the past decade, the stock market has increased by 10 per cent and gold by 21 per cent, but a Chanel bag continued to increase in value, up to 100 per cent, even after they swapped their 24-carat gold buckle for cheaper materials. In 2005, one of the brand’s classic bags costs US$1,650, and these days they’re worth over US$10,000.

“Just recently, actress Christina Ricci sold her collection of Chanel bags to fund her divorce, making use of her luxury goods as a true investment piece rather than accessories,” Kralow revealed.