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Are old sneakers worth investing in?

February 8, 2022

Can old sneakers really be a legitimate investment? Many online resellers and even one of the oldest and biggest auctions houses in the world think so. Recent astronomical prices may prove them right.

An Air Jordan sneaker worn and signed by basketball legend Michael Jordan
Nike and Adidas have long been the most desirable brands on the sneaker marketImage: Sothebys/dpa/picture alliance

Investors get creative when it comes to money. Some buy classic cars, property, art or fine wines. Many look for deals in stocks and bonds. Current high inflation and shaky stock markets are pushing investors into more niche markets. And now, more are buying and selling old sneakers.

Sneakers are undoubtedly comfortable to wear. There is a difference, however, between wearing sneakers and collecting or investing thousands of dollars in them. What happened — how did the simple shoe turn into the "next big thing," with its own Sneaker Con conventions and sneakerhead culture?

Blame Michael Jordan and Nike

Long lines to buy popular sneakers have been around in the United States for decades. Starting in the late 1980s, kids made their parents wait in line to get their hands on the latest Nikes from basketball legend Michael Jordan, whose dunking silhouette was used for the Air Jordan logo.

For most, it was not a long-term investment. There were short price shocks when certain pairs came out — but having them was more about being cool. Today, 36 years after they first debuted, Air Jordans have become iconic, and even have their own Wikipedia page.

At the same time, hip-hop music videos turned sneakers into status symbols. Suddenly celebrities, and later social media influencers, were seen wearing brand-name sneakers everywhere. 

Additionally, a turn away from suits and other formal attire toward more relaxed styles made streetwear and sneakers more acceptable in general. When the coronavirus pandemic forced more people to work at home, there was even less need for dress clothes or fancy shoes for the office.

A rack with boxes of old sneakers
Shoes piling up at a StockX operation center in the Netherlands, ready and waiting for new ownersImage: StockX

Keep it comfortable and authentic

What started out as a small subculture of American enthusiasts looking for special sneakers at swap meets or underground events turned into a major fashion trend. It was even exported to the rest of the world, and attracting young new fans. But two things held back the sneaker market: a lack of reliable information on secondhand sales and counterfeit sneakers.

Whether called sneakers, sneaks, tennis shoes, trainers or gym shoes, eBay has long been an easy go-to place to buy and sell sneakers. To keep buyers' trust, it started to authenticate sneakers through external service Sneaker Con Digital in October 2020.

The company personally inspects select brands of new sneakers sold for $100 (€87) and pre-owned pairs sold for over $150. It covers brands like Nike, Adidas, Puma, Gucci and Louis Vuitton.

Shoes being registered at a StockX operation center in the Netherlands
Authenticating sneakers has become a big business in itselfImage: StockX

The program proved so popular that in a little over a year, 1.55 million sneakers sold on eBay were authenticated. In November 2021, eBay bought Sneaker Con's authentication business outright, along with all its operations in the US, the United Kingdom, Canada, Australia and Germany.

It is a sign that the online giant sees pivotal potential in the sneaker business.

Being specialized to build trust

More specialized online platforms have also stepped in. StockX is a Detroit-based online marketplace that connects buyers and sellers, focusing on sneakers and streetwear. Founded by Dan Gilbert and a small team in 2016, the company now has over 1,000 employees at 11 authentication centers in the US, the UK, Canada, the Netherlands, Hong Kong, Australia and South Korea.

Besides authenticating all pieces before they are sent to a buyer, StockX has built up a huge database of price histories, resale prices and long-term trends.

In 2020, it hosted 7.5 million trades worth $1.8 billion. The most expensive shoe sold so far was a Nike Mag Back to the Future from 2016 that sold for $65,000.

Workers processing online orders
Employees at StockX have enough on their plate in processing online ordersImage: Henley Bailey/StockX

The platform has attracted a young user base. Today nearly 70% are under 35, according to Derek Morrison, StockX general manager for Europe, the Middle East and Africa.

"When you look at the data, the resale value of coveted models tends to appreciate steadily over time when kept in a new and unworn condition with original packaging," Morrison told DW. In a recent report, "we showed that a typical Nike Air Max 1 investor saw a 50% return on their portfolio between January 2020 and June 2021." 

Not too late to the show

The ultimate seal of approval for sneakers is their inclusion in Sotheby's sales. The revered auction house — known mostly for modern art, jewels and other high-end objects — started selling sneakers in 2019. It broke a previous record for the most-expensive sneaker in its first auction, selling a Nike Moon Shoe for $437,500.

It continued sneaker auctions until officially launching streetwear as a permanent category in December last year. Brahm Wachter, head of streetwear and modern collectibles at Sotheby's, told DW that "2021 was a banner year for sneakers at Sotheby's and we achieved several important records."

A pair of basketball legend Michael Jordan's famous Air Jordans from his rookie season during an auction preview at Sotheby's
For many customers, nostalgia plays a big part in their decision to invest in sneakersImage: FABRICE COFFRINI/AFP/Getty Images

That year, it hit another auction record for a pair of Nike Air Ships worn by Michael Jordan. This pair sold for $1.47 million in October. A few months before that, the Nike Air Yeezy 1 prototypes worn by Kanye West at the Grammys sold for $1.8 million in a private sale.

"Sneakers in many ways have the same traits as cultural assets like comic books. They mean something to a younger generation, who grew up adoring the designs. Our collectors are [aged] 20 to 40 and have an international spread," said Wachter.

Buyer be brave and beware

In another sign that sneakers have entered the big league, Sotheby's is holding a timed auction, ending on February 8, for 200 pairs of "special trainers" designed by the late Virgil Abloh to raise money for his scholarship fund. The shoes are a collaboration between Louis Vuitton and Nike, and each pair comes in a custom orange Louis Vuitton case. 

The starting bid for each pair was $2,000. Two days before the auction ended, every pair had a bid of at least $24,000. The highest, a size 11, was up to $80,000.

Louis Vuitton and Nike Air Force 1 sneakers designed by Virgil Abloh on sale at Sotheby's
When high fashion meets sneakers, the outcome can be dazzling and pricey streetwearImage: John Angelillo/newscom/picture alliance

The market has indeed grown up, become much more professional and available to a global audience. Talk of crazed kids seem outdated. "I think we will continue to see collectors, who traditionally collect in other categories, move into sneakers and increase the overall number of collectors in the space," said Wachter. Equally, he highlights the importance of comparing prices and looking at longer-term trends. 

Derek Morrison from StockX has another tip: "Always remember that like other investments, there is always an element of risk, and prices can fluctuate for a number of reasons — so nothing is guaranteed."

In other words, investors need to do their homework before taking the sneaker plunge.

Sneakers Rescue steps out in style

Edited by: Hardy Graupner

Timothy Rooks
Timothy Rooks One of DW's team of business reporters, Timothy Rooks is based in Berlin.