The pawnbroking transaction requires an item of security which can be used as collateral for the pledge. The majority of pawnbrokers will be set up to use gold jewellery for this purpose, it can be easily valued, stored and it has a quote market price.
High-end pawnbrokers, such as Hopkins and Jones, located in Charing cross central London, will deal in luxury assets and specialize in products such as Diamond set jewellery and prestige watches such as Rolex Submainers and Patek Philippe Calatrava.
As recently reported in the press, some more unusual items are finding their way into London pawnbrokers:
Addicted to pawn: Why designer handbags are the new gold
By Brian Milligan
Personal Finance reporter
- 26 August 2016
“It’s a Chanel day bag – a timeless classic. If you had 50 in the shop, you’d sell all 50,” says Nathan Finch, managing director of Pickwick pawnbrokers.
We are in the strongroom of his shop in north London, where he is showing off some of the hundreds of bags that customers pledge each year, in return for borrowing money.
Once it was mostly watches, gold or jewellery that people took to pawnbrokers. Now, designer handbags are the big growth area.
They are increasingly high in value – often worth thousands of pounds each, they are easily portable, and there is a seemingly limitless supply.
“For some women, it’s a bit of an addiction. They get their fix from buying a bag. But like most cravings, it comes again,” says Mr Finch.
Debbie Wynter, who runs the pawnbrokers Suttons and Robertsons in central London, calls them “the ladies who lunch”.
“One customer wanted to raise a loan so they could go on holiday on a private jet, in style,” she says.
The bags that hold their value best – and therefore are the easiest to pawn – are the classic designs by Hermes, Louis Vuitton and Chanel.
Two of the most valuable are the Birkin – named after actress Jane Birkin – or the Kelly, as carried by Grace Kelly in one of her classic films.
These are normally worth up to £6,000 each, but one exotic Birkin in pink crocodile skin is currently for sale on a French website for £167,000.
Admittedly it uses pink sapphires to fasten it, and white gold for the lock.
“What’s really interesting is that we are just starting to see these trends, as people move up from being casual buyers to collectors.”
Last year Christies sold a pink Birkin with diamonds in it for £168,000, and three months ago they sold another for £227,000 – a world record price.
End of extract.