Are designer handbags really a worthwhile investment from Hermès to Chanel?

Luxury handbags are increasingly seen as a potential investment in the eyes of consumers and analysts, outperforming other collectibles, according to recent reports.

According to a report by the CNBC financial website, the value of designer handbags from top brands such as Hermes, Chanel, Goyard, and Louis Vuitton experienced comprehensive growth for the first time last year, as shown in a report by luxury resale website Rebag.

Rebag’s report states, “These trends indicate exciting investment opportunities, whether with traditional or more accessible brands.”

A study by Credit Suisse in 2022 revealed that handbags are among the least volatile assets in all collectibles, offering a favorable risk-to-reward ratio, and they have proven to be an effective hedge against inflation.

However, experts note that while some designer handbags, especially classic and rare styles, may hold or even appreciate in value over time, they are not a conventional investment like stocks or real estate.

According to a report by Art Market Research in 2020, luxury handbags have transformed from mere accessories into “the only collectibles centered around women” over the past two decades.

Yet, the rising costs associated with this trend have consequences for women. Jasmine Tucker, Vice President of the National Women’s Law Center, says, “To appear prestigious, you have to dress a certain way, and the cost of women’s dressing may be higher, with lower pay for them.” Tucker added.

In terms of investment, only a small number of luxury handbags are likely to see an increase in value over time rather than depreciation. Rebag found that historically, only the Hermes Birkin and a few other high-end designer bags have a retention rate close to 90% or higher.

A study by Baghunter showed that the value of Birkin bags has been steadily increasing, with an average annual growth rate of 14.2% between 1980 and 2015. Currently, retail prices for a Birkin start at $9,000, but resale prices can reach $30,000 or more, depending on size, color, and condition.

In comparison, due to stock market fluctuations, the average annual return rate of the S&P 500 index is around 10%.

Carolyn McClanahan, a financial planner in Florida and founder of Life Planning Partners, believes that categorizing designer handbags as “investments” is detrimental to women.

McClanahan stated, “When I see someone position a purchase as an investment, it makes me uncomfortable.”

“I fully support people buying nice things, but I wouldn’t call it an investment,” she said.

“If you buy a bag that you’ll keep forever, perhaps that can be seen as a wise purchase,” she added, “but you still need to ensure that your expenses are less than your income, and that you are saving.”

McClanahan emphasized that at some point in life, most women may need to become self-sufficient and take control of their finances, making it all the more essential for women to plan and invest for the future.

(This article is for general informational purposes only and is not meant as a recommendation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or other personal financial advice. For specific investment matters, consult your financial advisor. The Epoch Times does not assume any investment responsibility.)