Hermès Birkin bag a better investment than gold and stock market? See what experts say about investing in the iconic luxury handbags, inspired by Jane Birkin

Produced by: Harshita
Designed by: Mohsin Shaikh

Jane Birkin, the British-born singer and actress, who became a style icon passed away on July 16 in Paris at the age of 76.  She was the inspiration for Hermès chief executive Jean-Louis Dumas in creating the luxurious Birkin Bags that almost every celebrity seems to don these days

Jane Birkin’s death

In 1983, Jane Birkin was travelling on a flight from Paris to London. She had just put her straw bag in the overhead compartment, when the contents fell to the deck, leaving her scrambling to replace them. She was seated near Dumas, and told him that she could not find a leather bag she liked

Jane Birkin's chance
meeting with Hermès chief

A year later, Dumas presented Jane Birkin with the Birkin bag, a spacious yet sophisticated leather design perfect for everyday use. The Birkin's pockets make it highly functional, and the bag seals to prevent anything from spilling. From humble beginnings, the Hermes Birkin was born, making its official debut in 1984

The origin of Birkin bags

To date, Hermès Birkin bags are some of the most expensive bags in the world, ranging anywhere from $9,000 to half a million dollars for the more high-end designs. The Birkin’s hard-to-get reputation is part of its allure. The details of how to purchase one directly from Hermès remain a closely-guarded secret

Price of Hermès Birkin bags

Hermès makes the bags in France using premium materials like calfskin, alligator skin, and even ostrich skin. Each bag is made entirely by hand. It takes the artisans 18 to 40 hours to complete one bag. In some cases, a Birkin can sell for multiples of the original retail price. The Diamond Himalaya Birkin bag is infamous for being the most expensive handbag ever sold at auction. In 2022, Sotheby's sold a Diamond Himalaya Birkin 30 for over US $450,000

Most expensive Birkin bag

Deloitte and Credit Suisse had reported earlier that the Hermès Birkin saw returns of 38% on average in 2020, the highest of all luxury bag collectibles. At the end of 2019, Knight Frank introduced Hermès handbags into their Luxury Investment Index (KFLII) and with 13% annual growth, they were the year’s top-performing asset class

Birkin Bags as an investment

According to Rebag's 'Clair Report' for 2022, Hermès handbags continued to top the Brand Value Index, retaining an average of 103% of their retail value. That means on average, Hermès bags end up being worth more on the resale market than their initial retail value. Due to the higher resale value, some experts even suggest buying Birkin bags for investment purposes

High resale value of
Birkin bags

Phoebe Chamier, senior investment manager at Brooks Macdonald, at a 2022 discussion hosted by Female Folio, said that luxury handbags are a viable alternative bucket for investors with well-rounded portfolios. She added that alternative assets can behave differently to stocks and shares, a category that also includes art, wine and cars. In a time that’s been “sensationally bad for traditional assets”, handbags “can be that uncorrelated return”, Chamier had said

Investing in Birkin bags

According to a 2016 Baghunter study, between 1980 and 2015, Hermes Birkin Bags had an average annual returns rate of 14% compared to 8.65% of S&P 500 and 1.9% of Gold. The Birkin bag has increased in value by nearly 500% in the past 35 years

Birkin vs S&P 500 and Gold

Based on the data collected by Baghunter in 2017, Birkin bags saw an 18% average rise in value since January 2016. The Birkin is extremely likely to continue breaking records and increasing in value year on year regardless of the economic situation or other external influences which impact the other markets, as per Baghunter

Birkin bags as investments 

Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Business Today. Investors should consult their financial advisors before taking any position

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