The Million-Dollar Bag: Why a Hermès Handbag Remains a Serious Investment
- Luxe magazine Switzerland
- 4 hours ago
- 4 min read
The Million-Dollar Bag: Why a Hermès Handbag Remains a Serious Investment
By Patricia Holdener
Why Hermès Handbags Still Outperform Many Luxury Investments.
From the record-setting €8.6 million Birkin to average annual apparel value gains, this article explores why Hermès handbags are considered investment assets, how value evolves and what buyers should be aware of.
Hermès Birkin investment, Hermès handbag resale value, luxury bag investment guide, Birkin ROI, Kelly bag investment, luxury resale market
PHOTO: @Kylie Jenner
When a Handbag Becomes More Than an Accessory
Imagine carrying a handbag that not only complements your outfit, but also appreciates in value. That is precisely the phenomenon surrounding the Hermès Birkin and Kelly bags. In July 2025, the original prototype of the Birkin, made for Jane Birkin in 1984, sold at auction in Paris for €8.6 million (≈ $10.04 million). This extraordinary result crystallised a narrative: luxury handbags specifically those by Hermès are not just status symbols, they may also be investment vehicles. In this piece, we examine how and why Hermès bags hold such potential, what factors drive their value, and what a smart buyer or investor needs to know.
The Market Mechanics: Supply, Demand, and Performance
Controlled Scarcity & Brand Strategy
Hermès has long relied on a dual model of impeccable craftsmanship and controlled supply. As PurseBlog observes, a key factor in Hermès’ resale phenomenon is that “the jump in price for secondary-market sales simply [occurs] due to the difficulty in obtaining a bag from the primary market.” Hermès also reported that its leather goods and saddlery segment grew 18% in 2024, signalling thriving demand.
Retail Price Increases
The base (retail) price of Hermès bags has stepped upward over years. For example, the Birkin 30 in Togo leather rose from around US $7,700 in 2008 to around US $11,600 by 2024. A report from Sotheby’s suggests annual increases of 4-6% are typical, with some years moving higher.
Resale Premiums & Performance
On the secondary market, Hermès frequently performs better than many other collectible assets. For example, PurseBlog reports that “the jump… can vary anywhere from 25% to over 500% of the original retail price” depending on model and condition. More specifically, a study cited on Wikipedia showed that between 1980 and 2015, Birkin bags had an average annual increase of 14.2%.
How Much Can Value Really Rise?
Auction Records & Extreme Cases
The July 2025 sale of Jane Birkin’s original bag is the standout: €8.6 million. This sale doesn’t, of course, reflect the everyday resale figure for a standard Birkin but it shapes the upper bound of the investment case.
General Returns & Expectations
According to a 2025 Fortune article, the long-term compound annual growth rate (CAGR) for a Birkin bag was estimated at around 5% over 40 years, acknowledging that the market is complex. Yet older data (1980-2015) suggested ~14%. Another source notes that certain Birkins “can double in value in 5 years.”
Hence, a realistic investor might expect modest annual growth (5-10%), while high-rarity pieces may yield much higher returns.
Resale Value Snapshot
A 2024-2025 review by Vogue reports that Hermès bags achieve resale values of up to 250% of their original retail price in some cases. Another data-driven blog shows which models hold value best: exotic skins, limited editions and classic sizes lead the pack.
What Makes a “Good” Investment Hermès Bag?
PHOTO: @mon_vintage
Model, Size, Material
Model: Within Hermès, the Birkin and Kelly lines carry the strongest investment potential.
Size & Leather: Smaller-sized bags (e.g., Birkin 25) often have stronger resale demand. One report states the Birkin 25 in 2023 was selling for over twice MSRP on average. Exotics (crocodile, ostrich) significantly amplify value.
Colour & Hardware: Classic neutrals (Noir, Etoupe) are safer. Rare colours, or unusual hardware (diamond, palladium) raise upside but also risk.
Condition & Provenance: Near-mint condition, full set (box, dust bag, receipt) and strong provenance all enhance re-sale value.
PHOTO: @Leonie Hanne
Timing & Market Awareness
Because the retail price itself rises, buying sooner may lock in a lower basis. But resale markets require patience and knowledge of trends. Trend-driven materials or styles may fade. A blog warns that depreciation can occur, and that not all Hermès bags hold equal value.
Liquidity & Risk
While demand is strong, legibility matters: attention to authenticity, fees, resale channel, taxes. As TheFashionLaw observes, Hermès itself is concerned about how the resale “bubble” might affect its brand.
Pros & Cons: Balanced View
Advantages
Tangible asset with intrinsic craftsmanship.
Demand-driven brand with supply constraints.
Secondary market data increasingly robust (Resale platforms, auction houses).
Potential for meaningful returns, especially for rare pieces.
Disadvantages
High initial cost, plus cost of entry (retail waiting lists, client history).
Condition & provenance risk: misuse or mis-documentation reduces value.
Trend risk: even strong brands can have weak performing models.
Transaction costs: auction fees, resale platform commissions, shipping/insurance.
Illiquidity: unlike stocks, resale might take time and price is not guaranteed.
Buyer’s Checklist: How to Approach the Purchase
Define Objective: Are you buying for use, collection or investment?
Select Model & Size: Prioritise models with strong resale history (e.g., Birkin 25, 30; Kelly 28) and classic colour/leather.
Verify Authenticity: Full set (box, dust bag, receipt), trusted dealer or auction house.
Evaluate Condition: “Excellent” grade bags command higher resale. Resale value drops for worn or modified items.
Understand Cost Basis: Include purchase price + fees, store tax, insurance, maintenance.
Plan Exit Strategy: Know your resale channel (auction house, peer-to-peer, resale platform), fee structure and tax implications.
Store Wisely: Maintain in optimum condition climate, padding, leather protection.
Stay Informed: Monitor price trends, especially retail increases (e.g., Hermès May 2025 US price uptick of 4.4-5.9%)
The Bag as Asset
For those willing to approach it thoughtfully, a Hermès handbag is more than a fashion purchase it can function like an alternative asset class. While it may not match the liquidity of stocks or bonds, the combination of strong brand, craft scarcity and global second-hand demand means that many pieces preserve and often increase in value. The record-setting €8.6 million sale of the original Birkin is a dramatic headline, but the real story lies in the incremental value preservation and growth of select models over years.
For the discerning buyer or investor, the key is selection, condition, timing and patience. In a world of intangible digital assets, there is something compelling about a physical object beautifully made, historically significant, and possibly appreciatingthat you can hold in your hand.
