HARRY POTTER fans who have bought JK Rowling’s novels right from the start could be sitting on thousands of pounds.

The first edition of Harry Potter and the Philosopher’s Stone was limited to only 500 copies in hardback and over 1,000 in paperback. As a result, a signed copy of a first-edition hardback (which sold for £10.99 in 1997) notched up a world record of £27,370 at Bloomsbury Auctions in London in May this year.

Prices can oscillate, with Bonhams securing £9,000 last month for a book that had originally been purchased with tokens given as a school prize.

Investing in modern first editions - usually those printed after 1900 - has become big business with good profits for those who do their homework.

“Modern first editions appeal to many people because they are authors they can relate to and quite often have read,” according to Roddy Newlands of Bloomsbury Auctions.

To check for a first edition, look on the copyright page for a series of numbers that should run in reverse order from 10 to one. Publishers also use terms like “First published” or “First printing”.

Avoid subsequent copies described as “new edition”, “this edition”, extra phrases like “second impression” or those made for book clubs.

Many of the Potter first editions were consigned to school libraries and became very worn, although a paperback can still fetch up to £900.

This is unusual as normally only hardbacks have investment potential. Look for mint condition - as close as possible to the pristine state in which the book was bought.

Potter potential is not limited to the first book. There were three first-edition issues of the third book - with one sent to Australia. This used Rowling’s Christian name, Joanne, instead of her initials. She objected and the publisher has never repeated it. Yet this variation is sufficient to give the book a premium, selling for £1,000.

An author’s signature can add even more to the value of a first edition. One dedicated to Grainne, who ran the Edinburgh cafe where Rowling wrote the first Potter, is offered by dealer Adrian Harrington for £32,500.

Another, inscribed “To David, with best wishes, J K Rowling” - given to the seller when he was a boy - realised £25,000 this year at Bloomsbury Auctions.

However, there are many faked autographs for sale on the internet. Always check with a recognised authority in the field.

Occasionally signed examples make no price difference, such as with Louis de Bernières’ Captain Corelli’s Mandolin and works by Jeffrey Archer.

Collectors are also drawn by the dustjacket. The price difference between a first edition with and without a jacket can be huge.

At auction, Brighton Rock by Graham Greene can fetch £200 to £300 without its wrapper but more than £30,000 with.

Few dustjackets survive, explaining the high prices they can bring to a first edition.

Star examples include Dashiell Hammett’s The Maltese Falcon from 1930 (more than £35,000), and Agatha Christie’s first Poirot novel, The Mysterious Affair at Styles, from 1921 (more than £20,000) and HG Wells’s The First Men in the Moon from 1901 (£12,000).

Perhaps the ultimate is the first issue of Ulysses by James Joyce from 1922. It was published in various limited states but the rarest was 100 copies on special paper, signed by Joyce. These can now fetch more than £150,000.

Matthew Haley of Bonhams tips Ian Fleming. A first edition of Fleming’s Casino Royale, from 1953, sells for between £5,000 and £10,000 depending on the condition of the wrapper. Inscribed, this can jump to £20,000.

Expect to pay £550 for Fleming’s Goldfinger, from 1959, but the price rises to £700 when inscribed by actress Honor Blackman, who played Pussy Galore, and to £2,500 when signed by the author.

Beatrix Potter’s The Tale of Peter Rabbit from 1901, even without the jacket, can fetch up to £40,000 and JRR Tolkien’s The Hobbit, from 1937, achieves £15,000 to £20,000.

It is unlikely that de luxe limited editions - signed by authors such as William Boyd, Kazuo Ishiguro, Stephen King or Ian McEwan - have investment potential because they are not first editions.

They may look attractive but they lack collecting value.

TIPS ON COLLECTING

Go for the first edition of the first book by an author who later becomes popular. Usually only hardback first editions have investment potential, though this is not the case with Harry Potter.

Books that have been televised or made into films can also increase in value.

A book should resemble its original state of publication and dust wrappers, if issued, should be in near mint condition.

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