Why Do These Hermès Bags Cost $70,000?

"People get very excited when Tuesday rolls around and we see a spike in website traffic as people close out last week's weekly and see what's in the following auction," Rubinger said.

The idea of a weekly auction is not new, as Heritage has hosted them for other categories, like coins and comics. But for luxury accessories, to start at $1 is "groundbreaking," he said.

"There are lots of places for vintage bags. There aren't places that let them sell at market price," he said. "We don't underprice or overprice. We let people compete and it sells for whatever people want it for. We are really trying to be the market."

In Photos: Pricey Chanel and Hermès Items Auctioned in Beverly Hills

So what are Rubinger's tips to buying a luxury handbag as a collectible?

He said there are three key determinants of value that can apply to other collectibles: condition, rarity and desirability.

The reasons why the crocodile Birkin bag may fetch $70,000 is that it happens to be in "pristine" condition, which is a rare classification by Heritage's standards.

"It looks as it did the moment it came out of the boutique," he said. It's also one of a kind, because it was custom-ordered, which is indicated by a tiny horseshoe stamp next to the Hermès signature. The indigo interior is also not common among Birkin bags.

Its size, 35 centimeters, known informally as a medium-size Birkin bag, is also practical for use and "desirable," Rubinger said.

Personal preference and how you're going to use a bag influences an item's desirability. And yes, even though these bags cost thousands of dollars, they are indeed used by collectors who own them.

"These bags are meant to be used and should be used," said Rubinger.

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