When Meg Randell started her career as an auctioneer a decade ago, many of the clients she met with were used to selling traditional assets like old paintings or antique ceramics, and never thought the bags sitting in their closets could prove as valuable.

Yet today, the auction house regularly sells Chanel and Louis Vuitton bags for thousands of pounds at auction. Rare editions can fetch even more: in July, Bonhams sold a well-used Hermès Birkin 35 that belonged to Jane Birkin herself for £119,000 ($143,334), almost eight times Bonhams’ original £15,000 estimate.

“I’d see couples coming in, and the guy would be like, ‘Well, she thinks her handbag’s worth something,’” said Randell, now head of designer handbags and fashion at London auction house Bonhams.

“What’s interesting is I almost never have those conversations anymore,” Randell said. “Almost everybody understands that there is value in these bags. Whilst it might not be the intrinsic value of jewellery … they’re finally being really appreciated as having the sort of extended lifespan of really beautiful objects.”

In years past, luxury bags from brands other than Hermès weren’t thought of as something whose value could increase over time, or even an asset class at all. That is generally still the case: beyond Birkins and Kelly’s, whose short supplies have long fuelled markups in the secondary market, most bags continue to depreciate after purchase. Yet as primary market prices rise and top luxury labels tighten distribution, bags are garnering higher prices at resale, with some styles from coveted brands are retaining a significant portion of their retail value both at auction and on online resale sites.

At luxury consignment site The RealReal, average prices for designer bags are up 26 percent year-to-date compared with 2019, roughly mirroring broader hikes in the primary market. (In the US, the average price for a designer bag has increased 27 percent since 2019, according to research from BoF Insights.) Yet among the three most popular brands — Hermès as well as Louis Vuitton and Chanel — prices have increased as much as 55 percent. In the case of Chanel, a pristine condition classic medium double flap bag can sell for above current retail value, according to the resale site. Even with signs of wear, the style commands on average 74 percent of its current retail price.

Price Rush

Much of this shift is linked to escalating prices more broadly in the primary market. For example, Chanel’s classic medium flap bag, which retailed at $4,400 in 2012, costs almost $9,000 in stores today.

“That type of appreciation for the most part is faster than inflation, and faster than some other assets,” said Cynthia Houlton, global head of fashion and accessories at Sotheby’s.

The most exclusive brands have helped drive designer bags to become a category for auction houses, with the likes of Sotheby’s and Christie’s selling such bags for significant sums. The surge in popularity prompted the research arm of property company Knight Frank to introduce bags as a tracked investment class in its annual Luxury Investment Index in 2020, joining watches and vintage wines, among other categories.

Hermès bags have long commanded the highest prices on the secondary market, but increasingly other mega brands are catching up.

“While you might buy a Hermès bag and sell it a few years later, and make a profit, there are other brands like Chanel and Louis Vuitton, where you might not make a profit, but actually you’ve had the bag for years and you still realise 80 percent of the original value on the secondary market,” said Bonhams’ Randell, “which is kind of incredible — particularly for people who maybe bought the bag 10 years ago without ever considering that one day they could sell it for a real amount of money.”

Resale sites have experienced similar changes. Before the Covid-19 pandemic, the online resale market was growing fast, thanks to the rise of specialist luxury resale sites like The RealReal, Hardly Ever Worn It (HEWI) and Rebag, while shopping for second-hand luxury goods started to shed the stigma of diminishing the quality or specialness of a purchase.

During the pandemic, demand heightened for the most exclusive brands on the resale market as many shoppers redirected their discretionary spending from restaurants and holidays towards items like designer bags, prioritising top luxury brands and classic styles that they felt would remain culturally relevant over a long period of time.

With accessibility and availability in the primary market disrupted thanks to supply chain constraints, shipping delays, travel bans and store closures, an influx of new customers turned to the resale market to get their handbag fix. For brands that already tightly controlled distribution, resale was the only way many first-time shoppers could access their products. A Saint Louis tote from Goyard, for example, retains over 90 percent of retail value on average on The RealReal, even when well-used, the platform said.

“With the few brands that are holding out from e-commerce, they don’t have the same accessibility from the primary market if you’re not shopping in-store or have your sales associate that you’re working with,” said Kelly McSweeney, merchandising manager at The RealReal. “That unintentionally paves the way for resale, where people can … get that immediate gratification.”

Now, handbag prices on the secondary market are beginning to stabilise, as many shoppers return to pre-Covid spending habits, said McSweeney. But demand for bags “continues to be really strong,” she said. “The handbag demand shows no signs of slowing down anytime soon.”

Trendy vs. Classic Styles

The accessibility and affordability of a bag will determine how much of its retail value it holds at resale. But what’s happening in stores — and the products the most desirable brands are pushing — can change dynamics pretty quickly.

About six months before Dior relaunched its saddle bag in the summer of 2018, Bonham’s Randall had a vintage purple ostrich Saddle style for auction, priced at about £300. It didn’t get any bids. However, following Dior’s re-release of the style, Randall put the vintage bag back on offer and it sold for nearly £2,000.

The resale price of Dior increased 40 percent last year compared with 2019, according to Bernstein analysis of data from luxury bag resale platform Rebag.

At luxury resale site HEWI, average selling prices for Prada and Fendi bags this year are up 48 percent and 78 percent respectively compared with 2019 levels. Sales director Natalie Kurukgy attributes the surge to the reboot of vintage styles like the Fendi baguette and Prada’s nylon range, as well as heightened interest in Fendi’s Peekaboo bag.

That said, the average selling price for a Fendi baguette or Peekaboo bag at HEWI remains around the £1,000 mark, compared to around £2,000 for a baguette or £4,000 for a Peekaboo at Fendi’s stores. By comparison, “in the case of Chanel and Hermès, customers are willing to pay close to market price for the right bag,” she noted. Ultimately, the most exclusive brands — in terms of price and scarcity — are the ones that command the highest levels of desirability.

“If we think of Chanel, and Louis Vuitton, I think a lot of the reasons why their most classic bags are retaining and gaining in value is it takes a long time for a brand to build that trust, create that provenance to create this iconic image of these bags,” said Sotheby’s Houlton. “You just can’t do that overnight.”

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