(Hand-colored photo taken in Prague, Czech Republic, 2003)There is a long history behind hand-colored photos. This Wikipedia entry has a very good description of the history with some good links concerning technique. I'm a bit of a purist. I still shoot on B&W film, make a silver print on fiber-base matte surface paper and color with oils. One of my prints would last, with proper display or storage, forever.
This is a good article on hand-coloring using a modern digital camera and paper. Although the old-fashioned look could be recreated this way, I doubt that it would have anywhere near the archival qualities. But if you are a scrapbook aficionado or just want a new hobby, this may be your best bet.
One of the more prolific colorists was the early 20th century photographer Wallace Nutting. If you type "history of hand-colored photographs" into the Google you'll get at least 157,000 pages to view at your leisure. Everyone has a unique style, Nutting is one of many.

