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How to Invest in Handbags That Hold Their Value

With the stock market in turmoil, luxury items, particularly designer handbags, are becoming highly sought-after investment commodities.

According to a July research by the Business of Fashion, 40% of US customers had purchased or were planned to purchase one, helping the category grow from a worldwide market of $72 billion this year to an anticipated $100 billion in 2026.

If you buy them to store and trade instead than carry, that brand-new purse may provide an amazing return on investment: According to a Credit Suisse Group AG report published in June, the value of Chanel bags increased by 24.5% over the previous year. Those designed by the late Karl Lagerfeld are extremely sought for.

Over other categories such as cars or wine, the whole luxury bag market was singled out for its risk-reward potential. According to Credit Suisse, handbags have yearly volatility of 2.5% to 5%, with returns in the mid-single digits.

They're not going to replace your BlackRock ETFs—retail prices may range from around $2,000 for an entry-level Balenciaga bag to more than $50,000 for some of Hermès' rarer, exotic-skin Birkins. However, they provide an opportunity for investors of all levels to participate in a pleasant game. (According to an August research by resale website TheRealReal, Gen Z and millennial consumers account for 41% of its clients, with Gen Z being the age group most likely to buy and try to turn stuff around rapidly to earn a profit.)

We canvassed the world’s best secondhand bag dealers, asking for recommendations for investment-worthy totes in two categories: first, a bag that’s already proved bankable on the secondary market; and second, a bag you can find in retail boutiques right now that the experts expect to offer impressive returns in the future.

To achieve the best price, which is far more than the average, a bag must be in pristine condition, preferably with tags still attached. A bag must be unusual at retail—sold in limited quantities or produced from a sought-after material—in order to gain in value rather than just hold it.

The Hermès So Black Birkin, a Jean-Paul Gaultier-era limited edition with black hardware and leather, is recommended by two experts. "It's alluring, the way it draws you in," swoons Diane D'Amato, Heritage Auctions Inc.'s director of luxury accessories, private sales, and boutique. Because none of the So Black designs have been republished, Judy Taylor, president and CEO of reseller Madison Avenue Couture, pushes for it.

The Potential: If you walk into a Goyard shop today, you'll be kindly requested not to take any photographs. "The associates are also not permitted to send you images," D'Amato explains. "With practically little promotion, no e-commerce, and only a few storefronts in key cities, the brand guarantees its exclusivity." She recommends a Plumet Pocket Wallet, which was released in 2018 and can also be used as a crossbody bag.

Price: It began at $1,080 at the time and has already risen to $1,310 at the store, with most Goyard models keeping 111% of its worth, according to D'Amato's calculations: "Goyard has a significant ROI, and I anticipate tremendous growth in the future."

The 1961 hobo-style model made popular as a paparazzi shield by the former first lady in the 1970s has been carried by Kate Moss, Harry Styles, and everyone else. Gucci design directors such as Tom Ford, Frida Giannini, and Alessandro Michele have reworked it. "It's the ideal investment item," says Sophie Hersan, co-founder of Vestiaire Collective SA, a Paris-based online secondhand business that operates in more than 50 countries. "Most antique Gucci bags have a retention value of plus-100%."

Site for resale According to Rebag, a medium Gucci Jackie 1961 Hobo in GG Supreme Canvas costs between $2,320 and $2,575. It is currently available for $2,850.

The Potential Stuff: "It was unlike anything at the time," Hersan recalls of the popular bag made by then-creative director Nicolas Ghesquière in 2001. "It had a slouchy silhouette with tassels and studs and no branding." The executives at Balenciaga refused to approve it." Determined, the designer had 25 manufactured and distributed them to influencers such as Carine Roitfeld and Emmanuelle Alt, and the rest, as they say, is history.

Price: The City line of Balenciaga grew into two new ones, the Neo Classic and the Cagole. The Cagole (seen above) is now the most popular bag on TheRealReal; new variants in multicoloured crocodile start at $2,500. Meanwhile, lightly used City bags for between $500 and $1,000 may be obtained on Vestiaire.