Are Designer Handbags a Good Investment?

designer handbags
Chanel store in Las Vegas

Designer Handbag Prices Up Over Time

Ordinary handbags have little value after a few years.  An old no-name bag could be sold at a thrift store or on eBay for a few bucks.  However, other bags like Chanel generally hold their value for many years, and in some rare cases even appreciate it.  Should you buy a designer handbag purely as an investment?

The general consensus among women who purchase designer handbags is that they hold their value far better over time than normal consumer goods.  A 2016 study by Baghunter showed that since 1955 a Chanel Medium Class Flap Bag has:

  • Has increased every year since 1955
  • Has beaten the increase in housing prices since 1955
  • Has beaten the stock market (S&P 500) in the last 6 years
  • Appreciated 70% in the last 6 years

Analyzing the Case for Designer Handbag Investment

However, keep in mind that they are comparing the retail prices of new Chanel Medium Class Flap Bags over time.  If you buy at retail and then re-sell it a year or two later, you are unlikely to be able to sell for the same price as a brand new bag being sold at a retail store.  The price of virtually any new consumer good is going to go up over time, simply due to inflation.  An investor would only be concerned with what a how much more a used Chanel Medium Class Flap Bag would sell for a few years after it was bought.

While designer handbags hold their value better than other consumer goods, you will likely still sell it for less than you paid.  The percentage decline will be nothing like the 90+% decline of a typical no-name bag, but it will still generally sell for less than you bought it.  If you buy at retail and plan on selling it down the road, you need to ask yourself is the enjoyment that I gain from owning this bag for 3-4 years going to be worth the amount that the bag will decline in value (not to mention the time value of money of waiting a few years to get your money back).  For many women, the answer is a resounding yes.

A Better Way to Invest in Designer Handbags

Can designer handbags be a good investment?  The people that make money buying and selling designer handbags will be those that find a used bag selling for less than it is worth, then turn around and immediately sell it for more money.  There are a number of websites that offer to buy your bags such as BagBorrowOrSteal, Rebagg, and Tradesy.  You should find out in advance what a used bag would be worth, then buy it for less than this amount (don’t forget to subtract the transaction fees the sites charge).  You might find a buying opportunity at a thrift store, an estate sale, on Craigslist, or through some other private seller.  Designer hand bag investing can be profitable, but just buying a bag at a retail store and holding it is probably not a realistic way to do it.

 

 

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