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Ancient Egyptians may not have been trading designer handbags in exchange for goods and services, but maybe they should have. According to a study done by Baghunter, Hermès Birkin bags in particular are a better long-term investment than stocks or even gold. While the value of a stock fluctuates over time, the value of luxury brands, specifically Birkin handbags have consistently risen in the past 35 years. In fact, in the past 35 years alone, their value has increased by a chart-shattering 500%, according to the study.
Historical data shows that between the years 1980 and 2015, the S&P 500 returned an average of about 8.65%, while gold had an average real return of -1.5%. Compare that to the average annual increase in value of 14.2% for the Birkin, and consider that the former two investments don’t take into account market conditions, and you’ve got a clear winner. In fact, at its highest point, Birkin bags experienced an increase in value of over 25%! But perhaps the most telling piece of information from the study was that the value of Birkin bags have never declined. Now that’s something.
The study also considered the risk factor involved in trading and buying stocks in comparison to the risk involved with buying and selling designer handbags. It revealed that the designer handbag industry was a less risky investment that often sees higher returns, especially over time. The value of a Birkin isn’t affected by market or economic conditions, and their value has even held up during times of a recession. One of the reasons for this is because unlike gold or stocks, Birkin bags can be maintained and nurtured to hold their value over time—making regular handbag care and maintenance not only a nice habit, but a smart way to proactively protect your investment. (For tips on how to care for and maintain your designer handbag, check out this helpful article!)
Part of the reason the Hermès Birkin holds such a high value to begin with is due to the bag’s low supply and high demand. The handbag industry is especially notorious for having waiting lists, as each bag is handcrafted carefully, skillfully, and uniquely. An Hermès Birkin, from start to finish, takes approximately 48 hours to construct. As you can imagine, the pressures of producing thousands of bags at a time have created quite a waiting list for the luxury brand. It’s been reported that the bag is now on a 6-year waiting list—and it’s not going away anytime soon.
Hermès Birkin bags are not only a symbol of beauty, status, and style, but they’ve recently made headlines for breaking the record of the most of expensive handbag ever sold. In 2015, a hot pink crocodile-skin Birkin bag was sold at an auction for over $223,000. The demand for the bag, and its infamous waiting list, are set to continue growing. In fact, the value of an Hermès Birkin bag is actually expected to double in the next 10 years.
If any of those numbers surprise you, you’re not alone. Now you can finally justify those larger purchases that may have your friends’ heads spinning—because hey, you’re an investor. Getting your hands on one of these beauties, or any luxury designer handbags, for that matter, is not only a fashion statement, but a financially smart one. Who knew shopping could be so profitable?!