10 tips on investing in Art

2010-04-02 16:32

Caulfield Interior

A few handy hints on the joys of art collecting and how to avoid the potholes on the road to success by Darren Tiffney

It’s real and it’s yours!  The wonderful thing about owning a work of art is that you can touch, feel, smell, see and enjoy it in your own home.  It can literally transform a space or more importantly how you interpret a space.  An illuminating example of this is when yours truly relocated from London to Harrogate.  Feeling a little sanguine about leaving my first flat, I tackled the careful wrapping of my artwork ready for the removal guys to dropkick them into the van.  It was only when I surveyed the bare walls that I realised how little sentiment I had for the flat; it was the artwork that had defined my home.

The early bird catches the worm
A risky strategy but one that could reap sizeable returns.  If you see a huge spark of potential in a graduate or unknown artist, you may manage to garner their work at a canny price.  The risk is all in the potential of course; that potential may turn out to prefer another career path, and you’re left with an artwork essentially created by an unknown artist.   I was fortunate a number of years ago in spotting the potential of the artist Banksy; an artist who has gone on to national and international acclaim.  

It’s not subject to market forces Unlike other investments such as bonds, shares, the American sub-prime housing market, the art market is uncorrelated to other market forces and rarely follows the same patterns.  This may prove to be an attractive diversification of your portfolio, but word of warning, art is subject to one of the most brutal of forces, that of fashion.  So timing is often the key.

Tackling the cattle market that is the Art Fair
I know, I know, they can be eye-arresting tiring affairs, but you do get to see an enormous volume of art under one roof.  They’re so prevalent now, particularly in central London, that there are now art fairs categorized under such auspices as, price, genre, medium etc so understanding your art taste and going to the right fair will save time.  There is also the added bonus of deals to be had.  Dealers are on their feet for five days solid, and nothing helps those sore pinkies like selling paintings, so they’re ready to deal.

Provenance Not to be sniffed at.  The better known the artist, the more risks are taken with authenticity.  Demand to know the provenance of the work, Nine times out of ten it will be direct from the artist via the gallery, but you never know.  A recent show at the V&A serves to exemplify how fakes can infiltrate the market.

It’s not easy to get rid of quickly Can’t say it any clearer than that.  Art is notoriously quick to buy, but slower to move on, unlike stocks and shares and such like.  There are the auction rooms and the sourcing gallery, but if your work is not in demand, then it might have a luke-warm reaction.

It doesn’t need a lot of money to maintain it
I’m stealing a line from the great Duveen, but it’s a very valid one.  Art is one of the few things you’ll spend a large sum of money on, and not as much again in maintenance.  Save for a touch of restoration or a re-frame every 25 years, looking after your precious piece of art is practically cost-free.  One important but oft overlooked point is insurance.  Do clarify with your insurer that you have adequate cover for your collection.  

Work to a budget Do be realistic.  If your savings are currently being contained by the porcelain prison that is a Natwest Piggy bank, then perhaps you should stop looking at that Monet that’s caught your eye.  Buy artwork within your budget, your pain threshold will increase with time, so it’s always a great idea to start off with works on paper or limited edition prints by big well-known art practitioners, before moving on to large scale investments.

Expanding your use of the Internet
The World Wide Web is an excellent tool to research art, artists, movements and galleries.  Some dealers are very upfront and clear about the price of a particular work, and I think that is a good sign that you won’t pay an over-inflated price for a work of art.  Proper research will show you, who the artist is showing with, what they have, and how much it may cost.  Also bear in mind, galleries are notoriously bad for updating their sites, so be prepared to use the net as a search mechanism, the work you buy may not necessarily be on the website.  

You’ve gotta love it Lastly and most importantly, the art you buy can’t simply be seen through the cold eyes of investment, you have to connect with the art on a personal level.  The toughest task I have is consensus; finding a couple that both enjoy the piece, rather than one or the other.  A word of warning, when you fall in love with art, it can become very, very addictive! Happy hunting! 

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