To Dream, to Collect

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There are many kinds of collectors out there nowadays, high-end and otherwise; some collect rare coins, while others are interested in stamps. Certain groups adore antiques, furniture, or even real estate. When it comes to investments, most people appear to be attracted to the idea of direct and larger returns through such processes, and there is almost always a passion for something that fuels these intentions of theirs. Investing in art, for instance, seems to be very good at combining both emotional and commercial success for the interested parties, and there is more than one reason why.

Don't miss our latest interview to the italian collector Umberta Gnutti Beretta...

The Art of Investing… in Art

So, is art a good investment? To begin with, if we look at the most recent art market reports, we can see that the sales on the global scale reached as much as $67.4 billion (The UBS and Art Basel Report for 2018), continuing a steady rise and marking one of the best periods of the past decade. You could have also noticed that art is becoming an asset class even if you are not interested in reports - think of the news headlines constantly made courtesy artworks by Jean-Michel Basquiat, Claude Monet, KAWS and of course Leonardo da Vinci, whose 600-years-old “Salvator Mundi” became the most expensive painting ever sold in auction in 2017 - because it is now worth a staggering 450 million dollars!

But leaving the numbers, the science and the assumption that investing in art might just be quite a lucrative venture completely aside, art is one of those things you can simply appreciate for what it is. You can buy a masterpiece, be it a painting, a sculpture, a print, a photograph, just because you liked it, because it spoke to you, or because it would look nice on your wall or inside your collection.

Whether you already know something about the world of art, or investing in general, it is always a good idea to jot down the reasons why you should do it, and what the rules of the game are. As in other fields of investment, it is also important to educate yourself and learn about making the right moves at the right time. While it is exciting to see a painting’s value rising tens of millions of dollars over the course of just a few years, we should not ignore the fact that the art market is not exactly a transparent one, it caters to taste, and it sometimes succumbs to forgeries. And, like many other markets, it leaves you with an item you must care for and maintain.

Fear not, though! The reasons in favor of investing in art certainly win on our pros-and-cons list; for one thing, unlike stocks for example, an artwork is a long-term investment that will definitely pay off one way or another; if not through actual money, then through the pure pleasure of looking at it.

 

 

Tips for Investing in Art

There are two questions that art investment experts agree that one should ask themselves before setting off on this adventure: “What kind of art do I like?” and “What is my budget?”

The first question, like art itself, is quite subjective. Browsing through art history books, going to see exhibitions in museums and galleries, seeing festivals and biennials, and visiting artist studios and art fairs are some of the good ways to get familiar with the sort of medium, style, subject matter and technique that appeals to you most. Once you find your niche, it is crucial that you obtain enough (good) information on the author, their history, important works and other projects, whether they produce unique works or series of them, etc. Talking to gallerists and art dealers is also never a bad idea, as you might learn valuable information and take useful pointers. 

Nowadays another helpful tool for reaching your favorite artist is Instagram. Read our article Latest artistic trends on Instagram!

In many cases, first-time artwork buyers tend to be impulsive, but being careful with your finances and a thorough investigation into what you are about to buy, like with many other things in life, applies here as well. Collecting art is a process that is almost bound to take years, which only makes it that much more beautiful, and there is really no perfecting it - every artwork is a story, an experience for itself, extra knowledge for the future.

The bottom line here, as suggested by many who are collectors themselves - buy what you like!

Another myth which surrounds the art market is that buying artworks is reserved for the rich only. Surely only artworks worth millions will end up on the news, but that does not mean that there are no affordable artworks out there. This of course relates to the second aforementioned question: you should definitely not let it discourage you if your budget is one of a millionaire, because artwork prices have a vast range. Even if it turns out that one of your favorite artists of all time is Andy Warhol, and you just found out that none of his five top-selling artworks goes beyond $30 million, chances are you can still find a print of his for a few thousand. In fact, some experienced collectors often advise their younger counterparts to focus solely on, say, drawings produced by blue-chip artists, as those often evoke the artist’s intention almost as well as a canvas from the same period would. Don't miss our recent article --> 4 Most Expensive Artworks by Living Artists...

If you are not interested in shooting stars, so to speak, going with your gut is fine too, but when it comes to less-known artists, do your homework and check on them properly - whether they are signed with a gallery, if they have exhibitions history, what their reputation is like, etc. Auction sales records such as Artnet and Artprice are also good sources of information on that someone’s previous sales, as well as on those who sell within the same price range.

And if you only like that one artist? That’s fine too! If you are lucky and an artwork from that artist (be it from yours or someone else’s collection) sells well, chances are that all the other artworks will increase in value, especially if they’re a part of a series/limited edition, and there are not many of them out there. This way, you can have your cake and eat it too - you own an artist you love, but you can also sell it at a profit. Best of both worlds! Keep in mind, however, that basically no artist ever produced perfect artworks at all times, so some might be more difficult to sell than others.

What happens when you got an eye on an artwork and you are willing to spend some cash on it? Wise planning, be it long-term or short-term, is recommended. A successful strategy can take your art collection long way, and getting in touch with professional advisors may not be a bad idea, depending on how serious you will be about the whole thing - they surely know how to navigate the art market’s muddy waters and will likely keep you out of trouble. If you also team up with a broker, your chances of flipping the works you own might increase (minus the fee you will pay them, of course).  

 

 

Where To Buy Art?

If you decide to do the art-buying business on your own, there are a few options out there for you. As you might guess, these too depend on your taste and preferences, and some experts might even say that this step is as important as the “how to invest in art” part. Perhaps asking yourself a couple of questions again will point you in the direction that is right for you: “Do I want to buy my artwork online?” or “Do I want to see it in person, and then decide?”

If you opt for the former, all you need is a computer, an internet connection, and a lot of curiosity. An encouraging fact is that the online art market is on a rise lately, growing 9.8% in 2018 according to the Hiscox Online Art Trade report, amounting to a total of $4.6 billion. Not bad! In fact, there are a few business models operating on the world wide web contributing to these numbers, including e-commerce, selling platforms and auction houses. But it’s not just about finding the right seller - the internet can be a good place for gathering information from other collectors and, surprisingly or not, many younger collectors find their artwork of choice on Instagram.

Speaking of auctions and galleries, they (still) exist in physical forms as well. If you prefer to experience an artwork you wish to buy in person, as mentioned before visiting galleries, artist studios and art fairs is the way to go. Such a decision will also allow you to bargain for a better price, something that is not so common online. Same can be said for art fairs, where galleries are showing their best works outside of their traditional setting. Last but not least, if you’re an adrenaline junkie, the tensions within an auction salesroom might just satisfy that crave for you, and put your name out there as one of a serious contestant.  

Art as an Investiment and a Pleasure

When it comes to the art market, there is only one rule - there are no rules. This, however, is what makes it interesting, because the possibilities are many. In any case, what you will surely be left with is the feeling of satisfaction of owning a meaningful artwork. The journey of acquiring one, as we can see, is an exciting, creative one, and it involves visiting exhibitions, talking to art professionals and artists themselves, and caring for the piece itself in a special way. What’s there not to like?

Courtesy cover images Sotheby's.

Stay Tuned to Kooness magazine for more exciting news from the art world.

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