LUXURY HANDBAGS ARE A BETTER INVESTMENT THAN CARS OR RARE WHISKY IN 2021
Fast cars, fine art, rare whisky and luxury fashion are increasingly desirable among those looking for their next passion investment. And with rising demand for extravagant items in the last year, there’s certainly money to be made.
Most Lucrative Luxury Investment Pieces for 2021
Fashion-lovers have long known the thrill of owning expertly crafted, timeless designer accessories, and it seems the rest of the world is finally catching up.
Over the past year, luxury investments like high-end handbags and wristwatches have been noticeably increasing in value. But of all the passion investments we could possibly lust over, luxury bags dominate for their ability to turn heads and a profit.
Having officially become recognised as assets, handbags have out-performed artwork and other popular collectables to become one of the most profitable, in-demand luxury investments in the world.
Most in-demand investments last year:
- Handbags: +17%
- Fine wine: +13%
- Classic cars: +6%
- Watches: +5%
Meanwhile, there was a drop in the demand for other passion investments, like art (-11%) and rare whisky (-4%).
Lalage Beaumont says, “we all know the irresistible allure of an iconic bag, and over the last 12 months, designer pieces have surged in demand as more people look for the mood boost that comes with a glamorous purchase. Whether for investment or the simple love of shopping, an increase in online auctions and sales means handbags top the must-have list for shoppers across the world.”
More than a Status Symbol: Handbags are Too Hot to Handle Right Now!
Our favourite luxury brands pride themselves on keeping certain details largely secret, including how to get your hands on a particular colour and leather. This sense of mystery keeps things exclusive and keeps consumers craving more. Demand also outweighs supply enough to drive prices steadily upward.
Between the start of 2020 and 2021, online demand for ‘designer handbags’, ‘designer watch’ and ‘designer accessories’ all saw a notable increase as more buyers sought out some of the best luxury items to invest in.
So, how does a luxury fashion purchase stack up against other more traditional investments?
As if we need any more reasons to shop handbags, recent research on one iconic designer handbag showed that its retail price increases by an average of 3% yearly – more than double a standard ISA’s annual interest rate.
Other popular styles see increases of approximately 12-14% in retail value every year. This return on investment outweighs what you would get from a savings account or a low-risk stock investment.
If you’re shopping for an investment bag, here are a few key things to think about.
- Material: Invest in a material that will wear better and last longer. Leather is a clear winner, and other options like vegan leather or quality canvas will keep their integrity over time.
- Shape: Choose a bag in a classic shape that will last over multiple seasons, instead of a more unusual design that follows a specific trend.
- Supply vs demand: There’s a lot of value in timeless classics, but certain markets will always have their eye on a limited-edition piece. You might hit gold with a rare and unique luxury bag.
- Resale potential: Find out how much you could resell your bag for – if it appreciates in value, you could get much more for it than you paid.
- Branding: Some bags carry conspicuous logos, while others are more subtle. Depending on the brand you’re buying, look at the trends to see whether their ‘logo-splash’ designs or their more minimal bags have held their value better over the years.
It might sound like a fashionista’s dream and a financier’s nightmare, but the facts speak for themselves: investing your funds in a beautiful designer bag could bring you better returns than stashing it away in a savings account or even investing in stocks. And even if it doesn’t, you deserve a gorgeous new addition anyway.
What a perfect excuse to splurge!
This content is for informational purposes only, and is not intended as financial, tax, legal, investment, or other advice. You should consult a qualified financial adviser before making any decision or taking any action regarding your finances.