Reselling coveted designer bags can make savvy investors a huge profit, but not all designer brands are created equal in the second-hand market.
Luxury brands hate the resale market because it allows people to profit from counterfeit products, especially when second-hand websites don’t have strict authentication controls.
However, another concern for the high-priced companies is that certain designs sell for more on the resale market and make a fortune for resellers, which can lead to consumers rejecting merchandise that does not hold its value.
Over the past four years, consumers have spent $1.3 trillion on new luxury goods – handbags, clothing, watches and jewelry. Wall Street Journal reported.
The resale market has doubled in size over the past four years, with $49.3 billion worth of luxury goods sold worldwide by 2023.
Reselling coveted designer bags can make savvy investors a huge profit – but not all designer brands are created equal on the second-hand market
Over the past four years, consumers have dropped $1.3 trillion on new luxury goods – handbags, clothing, watches and jewelry
Hermès bags are so sought after and exclusive that aspiring owners are willing to spend serious money on a used bag to avoid waiting for listings
According to data from The Real Real, a popular online marketplace for selling luxury goods, Louis Vuitton handbags lose an average of 40 percent of their value when resold — even though rarer designs like this one seen on Rihanna are doing better than most
The brand’s iconic Kelly bag was named after Princess Grace Kelly and is now an expensive status symbol, with Kyle Richards pictured here in Epsom leather with palladium hardware. The Real Housewives star is an avid handbag collector and at Hermes in Paris with Michael Coste, the brand’s director and VIP whisperer
Hermès bags are so sought after and exclusive that aspiring owners are willing to seriously buy a used bag to avoid playing the Hermes game – which normally involves developing a relationship with a sales associate, an expensive pre- expenditure and a waiting list of a year or longer.
A standard Birkin 25 bag costs about $10,000 in retail value, but can resell for $24,000 or more.
Hermès’ 10-inch Ostrich Birkin bags have proven to be rare, with only 25 sold at auction in the past decade. Their average sales price as of 2020 is $35,000, with a 2021 Noir Ostrich Birkin 25 selling for a generous $40,420 in 2022.
Rare Hermès bags fetch even more money – with a Himalayan Birkin setting a world record in 2020 when it sold at auction for a whopping $382,295.
Birkin bags are not just a fashion statement; they are an indication not only of wealth, but also of status and often fame.
Stars such as Kyle Richards, Victoria Beckham, Paris Hilton, Pippa Middleton, the Kardashians and of course Jane Birkin herself have all owned the famous Birkin bags.
The brand’s iconic Kelly bag is named after Princess Grace Kelly and has now become an expensive status symbol.
On average, second-hand Hermès bags cost 25 percent more than brand new ones purchased directly from the store.
Although used products from luxury brands like Hermès, Patek Philippe and Rolex fetch more money than their brand new versions, most other designers have a lower resale value than their original price.
According to data from The Real Real, a popular online marketplace for selling luxury goods, Louis Vuitton handbags lose an average of 40 percent of their value when resold.
An ostrich Birkin like the one seen here on Jordyn Woods can fetch $40,000 on the resale market, depending on size, color, hardware and condition
Beth Silverberg, an expert on the resale market and a savvy investor, emphasizes that designer handbags are just as lucrative as real estate, art and even stocks.
Christian Dior bags lose half their value on the resale market.
Meanwhile, other brands are seeing their resale values fall – with Burberry’s average falling 17 percent since hiring their new creative director at the end of 2022.
Paris-listed luxury group Kering, which owns Gucci, Balenciaga and Bottega Veneta, has seen values fall, with its top three brands down 10 percent, 14 percent and 23 percent respectively.
Chanel increased the price of its popular mid-size Classic Flap bag by as much as 70 percent during the pandemic – but the bag’s resale price has yet to catch up with the new label.
Some designer brands tried to enter the competition in the resale markets by collaborating with them, a model attempted by Gucci, Stella McCartney and Burberry, but their efforts were short-lived and generally did not bear fruit.
Beth Silverberg, an expert on the resale market and a savvy investor, emphasizes that designer handbags are just as lucrative as real estate, art and even stocks.
Beth Silverberg is pictured with a white vintage Hermès Kelly bag that she bought for $600 but has a retail value of $15,000. She is also holding a rare hot pink Chanel handbag, purchased for $6,000, and an ultra-rare Birkin 20
Silverberg, a former professional poker player, estimates she has made more than $100,000 buying and selling purses from brands like Chanel, Hermès and Louis Vuitton since she started her collection at age 16.
And its earnings are only set to rise after a report from asset manager Credit Suisse predicted that handbags would be one of the best ‘collectible’ investments of 2023 – surpassing jewelery and art in terms of resale value.
“My very first bag was a Louis Vuitton 30 Speedy, which I bought for $150 with the tips I earned as a waitress,” the 55-year-old from Pennsylvania told Dailymail.com.
“I flipped mine for about $600 years ago, but they’re now worth $1,500.
“I’ve always invested in stocks, but my bags have far surpassed anything I’ve made the traditional way.”