What you need to know about passion investing

Collecting luxury objects can be a great way to diversify your investments, too, once you have a pot of money in pensions, stocks and shares. Their value often goes up and down in an opposite way to the more traditional investments and, in some cases, they can act as a hedge against inflation.

As with shares, not all beautiful products will make money for you. Some of them can become totally unfashionable for no apparent reason and lose value, much like poor-performing investment funds, so you need to know which items to buy and when and where to sell them to make a profit.

Here’s what you need to know about some of the most popular passion investments…

Top toys

When you think about investing in toys as collectibles, the first name that comes to mind is Lego. A study in 2021 by the National Research University Higher School of Economics in Russia found that investing in Lego could be more lucrative than gold, art and wine! In fact, the most expensive vintage Lego set ever sold was an unopened Lego 375-2 Castle, which recently fetched $11,565 (around £9,498). The market for secondhand Lego sets rises in value by 11% a year. Then there are dolls, specifically Barbie and Sindy, which are highly collectable and, in some cases, very valuable. For example, an original 1959 boxed Barbie with the black and white swimsuit in mint condition can now fetch around £8,000.

Antiques expert Tracy Martin is a fan of Sindy dolls and says that although they’re nowhere near as valuable as the best Barbies, some can go for a lot of money. ‘If you’re clever, you could make a few hundred on a rare one,’ she says. ‘I had a really good find 10 years ago when I paid £18 for a box of assorted Sindy dolls. One of them was a Mitzi – Sindy’s French cousin. Her hair was cut and her fingers a bit chewed, but I still got £350 for her.’

WHAT TO LOOK FOR: Lego regularly launches special sets alongside big movies or TV shows, and it’s their rarity that makes them valuable. For information on Lego trends, try brickpicker.com. Condition of collectable dolls is also important: there should be no greening, their fingers, toes and legs should not be chewed and their hair and clothes should be in good condition.

WHERE TO BUY AND SELL: For Lego, try eBay or specialist sites such as bricklink.com. eBay has a massive market for Barbie and Sindy dolls, too, as does Etsy.

Handbags to hang on to

Luxury handbags have performed remarkably well financially in recent years; the latest Knight Frank Luxury Investment Index shows that designer handbags rose in value by 60% over the last 10 years.

The Birkin 25, for example, retails new for about £9,000, but can be instantly resold for more than double its value at auction or on one of the resale sites. On the secondary market, you can potentially make money by picking up a luxury bag that’s ‘on the up’. The Chanel flap bag, for example, is doing well right now.

WHAT TO LOOK FOR: All top-flight luxury handbags are going up in price at the moment, including Hermès, Gucci, Louis Vuitton and Chanel, says Meg Randell, head of designer handbags and fashion at Bonhams auction house. ‘If you pick something classic, the chances are you can make money later on,’ she says. ‘The way to really make money is to find the bags that currently sell for hundreds but could retail for much more at a later date. For example, the Fendi Baguettes were more affordable a few years ago, costing hundreds each, but now sell for thousands.’ With secondhand bags, look for items that are in good condition, and always ensure they are authenticated, with paperwork to back it up.

WHERE TO BUY AND SELL: Specialist sites include wilson55.com, fellows.co.uk, vestiairecollective.com and bagista.co.uk

Furniture that’s future-proof

Investing in furniture needs thought – and space! Interestingly, 20th century (and even 21st century) items can be more collectable than much older and more recognisable ‘antiques’. When it comes to new furniture, look for one-off designer pieces that have not been copied elsewhere. As with everything, it’s important that you buy what you love first and hope that it will rise in value second.

WHAT TO LOOK FOR: Tracy says that Scandinavian furniture is huge at the moment – and she doesn’t mean Ikea! ‘It depends on the maker and the style, but items from the 1950s and 1960s are particularly popular right now. A Lamino sheepskin chair, for example, can go for more than £1,000.’ She also points out that 1970s teak furniture has started to rise in value. ‘Look out for the maker’s mark to be sure it’s genuine,’ says Tracy. ‘The condition of the piece will affect its value: there should be no sunlight bleaching, damage to the wood or woodworm to get the maximum price at resale.’

Scott Humphreys from Peppermill Interiors suggests that stackable chairs can also be worth investing in as they’re timeless design classics – and reasonably priced, too. For example, right now you can pick up vintage French plywood stacking chairs for £60 each on eBay. ‘Plywood stacking chairs are widely available; many people may already have them stored in their home or could find them in charity shops and at online auctions. With some deep cleaning and care, these chairs can be easily restored to their former glory and resold,’ Scott says.

WHERE TO BUY AND SELL: Local auctions and antique fairs are the best places to buy and sell collectable furniture and furnishings. You can find out about upcoming auctions at The Saleroom (the-saleroom.com/en-gb) and Auction Sale Finder (auctionsalefinder.co.uk).

You can also find out about local antiques fairs at Antiques Atlas (antiques-atlas.com/dbevents). Other good sites for vintage items include huntvintage.co, vinterior.co and loveantiques.com.

The value of art

According to the Knight Frank Luxury Investment Index, art is currently the fastest-growing luxury asset, up by 30% last year. If you’re just starting out as a collector, it’s worth looking at the less expensive artworks, such as limited-edition prints (these are signed by the artist and you’re guaranteed there are only a few in existence). ‘For a budding art collector who loves well-known artists, you can still buy work by a “name” for not much money,’ says Jessie Bromovsky from the Prints and Editions department at Bonhams.

The trick is to pick up prints by artists who are going to get bigger, but that can be hard to call, even if you’re an expert. Right now, she recommends artists that sell in the low hundreds, such as Peter Blake, a quintessential English artist who is very affordable. A Peter Blake screen print from 2014 sold for £11,475 in March last year, for example. Keith Haring is also worth considering.

WHAT TO LOOK FOR: It’s best to go for prints with runs of less than 100 or, even better, no more than 20 or 30. Things to think about include whether it’s signed by the artist and the condition of the piece.

WHERE TO BUY AND SELL: The Affordable Art Fair (affordableartfair.com) runs events around the country. Look, also, for independent galleries in your local area that sell the kind of works you like. Dawn Titherington, owner of Windermere Fine Art Gallery, says: ‘One art distributor (the people who sell on behalf of the artist) I recommend is Wishbone Publishing, which looks after highly sought-after, internationally acclaimed artists, such as Michelle Mackie, JJ Adams and Paul Oz.’ Sell through an auction house (find a list at the-saleroom.com/en-gb/auctioneers) and they will appraise your print free of charge and help to set a reserve price.

‘I made more than £5,000 from a handbag’

Yvonne Evans, 66, from York, has been collecting luxury handbags and shoes since she was in her 30s. ‘What started as a love of designer handbags soon became a lifeline when I was made redundant,’ she says.

‘Selling them taught me that certain items don’t depreciate in value and can, in fact, increase significantly! I now exclusively collect limited edition handbags and designer shoes. The best brands for making money are Mulberry, Chanel and Jimmy Choo.’

Her best purchase has been a Loewe handbag, which she originally bought for £599 and sold a couple of years later for £6,000. Yvonne says she buys from websites such as Vinted and eBay, as well as high street shops. ‘I tend to keep the items for about two years, enjoying them myself while taking incredible care to keep them looking their best. By then, the item has spent long enough “in demand” to push prices up. You learn to play the market like a stock exchange and predict what will still be desirable later on.’

Private buyers come directly to Yvonne now, but she also lists on eBay: ‘I look to see what others are selling for. Always make sure to add a minimum sale price; I once forgot and there were lots of tears!’

3 golden rules of passion investing

Think long term

As with more traditional investments, you usually need to hold on to passion items for a good few years in order for their value to grow. Sometimes you could be lucky and see stellar growth in the first couple of years, but generally you have to wait at least five years to see a profit.

Take care