A complete guide to investing in original art.
by Tanya Singh
In 1995, the sum total of the art sales in the contemporary and post-war categories amounted to $260 million. Last year, as a result of a decade-long increase, this amount escalated to $7.8 billion.
There is absolutely no doubt that the art market is booming at the moment. However, as with any other commodity, investing in original art too comes with considerable risks.
After all, who can predict the future? There is no guarantee that the current boom will continue or whether it will end in a devastating crash. But one thing is for sure, artists will continue to create and art lovers will continue to invest, regardless of the economic atmosphere. A genuine interest in art, however, is not the only reason for this.
Time and again, original art has proven to be a fine and rewarding long-term investment.
So, whether you are an art collector or a businessman looking to invest your funds, knowing some basic information about the art market is a must.
The first and foremost thing to consider before investing in original art is knowing the difference between an art collection and an art investment. The two might go hand in hand for many, but having a little clarity on your purpose can be the very first step to buying smart.
An art collector is somebody who has a genuine interest in fine art. He has sufficient background knowledge to make personal judgments over works of art and those personal opinions form the basis of his decision to invest in a particular work. An art investor, on the other hand, is someone who has more knowledge of the economic aspect than aesthetics. He views art as a profitable commodity and his decisions are based on the performance of the work in the past as well as predictions for the future.
Ideally, in today’s fast-paced world, it is important for art collectors to know more about investments and vice versa. This is because blindly buying original art solely based on its appearance is like judging a book by its cover. Art does not come cheap and you need to consider its worth in the long run even if you can afford it comfortably now. Investing in art that does not appeal to you is also not the wisest thing to do. The art market is extremely unpredictable and you could be stuck with a work of art you don’t care for at all, for a very long time.
Therefore, investing in original art takes equal parts of knowledge about the financial aspect and a genuine connection to the work of art. As Kym Elphistone, the founder of [Art]iculate, a PR consultancy specializing in fine art, said, “Art collecting should be for the collector’s enjoyment in the first instance but there is no reason why it can’t also be a smart investment if you do your homework.”
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If we consider art market performances of the past, the best time for investing in original art is when the market is uncertain. In other words, when inflation is on the rise, the art market does very well. However, there are some other, more important factors, that come into play when investing in original art besides timing.
The kind of art you are purchasing is one of those factors and a very essential one, too. For example, the contemporary art market is extremely volatile which is exactly why it offers the most rewarding investments. Another factor is the presence of trends that influence the art market significantly. Two years ago, the art market was all about emerging artists. However, the speculation has gone down since then and people, especially those that are focused on investing rather than collecting, are once again starting to drift to established well-known artists.
The market atmosphere and financial benefits aside, art as an investment is not all about the returns. Art enriches your life in several different ways. Not only does it instantly bring a space to life, but also affect your mood and behavior. A beautiful and bright painting can actually contribute to the overall performance in an official space whereas a calm landscape can help you relax and reflect. Your decision of investing in original should not just depend on its value as an asset but also what it adds to your life and to your personal space.
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Therefore, there is no right or fixed time to invest in art. If you see something that catches your attention and really speaks to you, go ahead and utilize that inspiration. As far as the financial aspect is concerned, it might be a risk but if you are cautious and keep the art market trends in mind, you are likely to be rewarded.
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If you are genuinely interested in art, there is a good chance that you visit art galleries often or have some artist friends. That is always a good place to start. Art galleries are perhaps the best place to look for emerging talent as well as popular local artists. Events like art fairs and art shows are a great avenue if you are not very sure about the kind of art you want to invest in. Affordable Art Fair, for example, is the best way to experience a wide variety of accessible and reasonable original art from all over the world.
However, if you are looking to find good yet affordable investments, technology can be a great help. A large number of art galleries have launched online platforms, like Agora’s ARTmine, in order to make their collections available to anyone in any part of the world. Then there are always the big names in the art industry like Christie’s and Sotheby’s that hold art auctions. These can also be reached online.
Once you have decided on investing in original art, there are a number of things you need to think about –
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Investing in art is as much a personal process as it is a calculated decision. You need to be able to emotionally connect with the work and also consider its worth in the future. It might even have some considerable risks however, an art collection is an exciting and enriching journey to embark on. As Sylvia White, the founder and director of Sylvia White Gallery, California said, “As a collector, you will discover that surrounding yourself with art can enrich not only your visual experiences, but instil a sense of vitality to your life and uplift your soul.”
Need some specific advice regarding your art collection or help in starting afresh? Benefit from our curatorial services! To know more, contact us at [email protected]
The benefits and profit aside, the main idea of investing in art should be to find the kind of art that speaks to you and pursue it, as you would your dream house or career.
Tanya Singh is a budding art historian and writer. She is currently pursuing her postgraduate studies at the LASALLE College of the Arts, Singapore. With a versatile portfolio, she has over three years of experience in writing as well as editing.