A corrected version of the story is below:
Luxury handbags making splash on the auction block
A growing auction market: Hermes, Louis Vuitton and Chanel handbags; record price: $203,150
By ULA ILNYTZKY
Hermes, Chanel, Louis Vuitton. What woman wouldn't covet a handbag by one of these iconic fashion houses?
The still red-hot status handbag market — driven by celebrity trendsetters such as Katie Holmes and Victoria Beckham — has not escaped the notice of some big auction houses. They say it's a new and growing category that is attracting a global clientele of sellers and buyers.
"For the last five years there's been an incredible growth and interest from the average consumer in that type of piece," said Matt Rubinger, director of luxury accessories at Heritage Auctions.
Dallas-based Heritage has embraced the market wholeheartedly since its first dedicated handbag auction in December 2010.
At its holiday sale a year later, a red crocodile skin Hermes Birkin bag set a world auction record when it sold for $203,150. A blue crocodile version at the same auction sold for $113,525, and a shiny red crocodile Birkin fetched $95,600. All three shattered the previous record of $82,100 for a black crocodile Birkin sold at Christie's London in 2009 — two years after Christies sold two dozen Hermes Kelly bags and other designer handbags and accessories. That 2007 sale convinced Christie's to get in this game, and there is a London auction planned by Christie's for November with 70 bags by Hermes coupled with vintage couture of early 20th century designs by Chanel, Louis Vuitton and Lanvin.
This past January, Heritage expanded to include weekly online sales that start at $1 and have no reserve and estimates. Generally, pieces sell from $500 to $2,500.
There is the occasional bargain, though: Recently, a rare Louis Vuitton top-handle bag in navy-blue Lucite realized $325 during a Heritage weekly sale, and a vintage Carlos Falchi clutch sold for as little as $69.
"It's often the more modern versions, the brightest colours and rare leathers that sell for the highest prices," said Christie's fashion specialist Clare Borthwick.
These bags are relatively new pieces, most designed in the last 20 years, although some date back to 1950.
So, what's all the fuss?
It comes down to quality and craftsmanship, with Hermes positioned at the very top as the ultimate must-have status symbol with its tailored and sophisticated Birkin and Kelly silhouettes. (The bags are named after French actress Jane Birkin and the late Grace Kelly.) They are fine leather, limited edition, hand-crafted pieces that "take hours and hours and hours" to make, said Rubinger.
Other popular, classic and coveted bags are the Louis Vuitton duffel-style Keepall and its smaller-sized cousin, the Speedy, and the Chanel classic flap bag — with its signature chain strap.
The waiting list for a new Hermes bag can be considerable, leading many people to discover auctions as a viable alternative, added Carole Gordon, head of Bonhams' jewelry department, which combines its fashion accessory categories under one umbrella. Auctions are also often home to "unusual and one of a kind pieces," she said. It's also a place where styles no longer available in the retail market can be discovered.
While many people may think it's crass to spend five or six digits on a bag, the auction houses said they hold their value.
"Hermes bags appreciate the moment you buy them," said Rubinger. Compare that "to someone who spent $200 on a bag in the primarily market that isn't worth anything as soon as they buy it — with no secondary market for it."
"The really tried and true pieces hold their value and increase their value over time. There's a huge market for these pieces," he added.
Depending on the brand, the model and the piece, a seller can get between 50 and 120 cents on the dollar, said Rubinger.
"Most of our buyers buy to wear. We don't necessarily have collectors," said Borthwick. "We don't know if that might change in the future."
Strong prices at a May Bonhams auction featuring Hermes bags from a private collection, most of them unused and in their original packaging, were "a reflection of the rarity of these bespoke items," said Gordon, adding that the British auctioneer was considering holding future handbag sales.
Rubinger said he gets consignment pieces every day.
To prove his point, during an interview he walked over to a large unopened box sitting on a table in Heritage's New York office that had just arrived from Qatar. He slit it open to find two Louis Vuitton purses: A green mousseline mink and crystal Demi Lune Limited Edition Show Bag and a LV monogram multicolour Keepall. Both will be offered at Heritage's Dec. 4 holiday sale with a pre-sale estimate of $2,000 to $3,000.
Rubinger produced two other rare pieces that will be included in the sale: A Hermes shearling Kelly bag estimated to sell for $15,000 to $20,000 and a Hermes sterling silver mini Kelly bag with presentation box estimated to bring $20,000 to $30,000.
Online: Heritage Auctions: www.ha.com