Art Superfund Pitfalls

Increasingly, we are valuing artworks included in superannuation funds. The main talk so far has been about the rules regarding the display of the artworks at the home or office of the superfund’s beneficiary.

We at Banziger Hulme however are concerned about something much more elementary: where is the art sourced from?

This is a very important question. When we value artworks owned by a superfund, the rules say that we have to give a market value for the works.

To give an example: we have just valued some artworks by well known and well respected Australian artists with a good track record in the auction room. However, the works in question were purchased at high retail prices – when similar works could easily have been purchased through the auction room for up to half the price paid.

Although there are solid gains on the values of both the artists, it will probably take many years for the auction room or market value to catch up with the retail price paid for the paintings.

It’s important to remember: When purchasing works in the secondary market for superannuation purposes, they are better bought at auction with good advice from an art consultant or unbiased advisor.

Contemporary art is a different matter and can be sourced from the best galleries and on occasion also in the auction room – again it’s best to seek impartial advice prior to purchase.

There are a lot of different art publications and they generally focus on the primary or contemporary market. We recommend subscribing to the Australian Art Market Report for a good overview of the whole market, both primary and secondary. It’s concise and also not full of advertising…  Available only on subscription

PLEASE  seek the advice of an unbiased, independent art professional who is not an art dealer, before you proceed with any art purchase for a superannuation fund, or indeed if the purchase is with a view to investment.

We can assist you with professional advice and reports so you can make an informed decision.  A lot of art is sold as an investment, when in reality only a fraction of art sold fits into that category. If you want some of your art for investment, we can at least show you where and how to buy it, without getting your fingers burnt.

Contact us via email or send us an art enquiry .

Written by

Brigitte Banziger

Hi, my name is Brigitte Banziger and I am an art consultant and manager at Banziger Hulme Fine Art Consultants, Australia's art valuation and art advice experts. We specialise in art valuations for insurance purposes, for family division, deceased estates, superannuation funds and market values, and advise clients regarding purchase and sales of art (art brokerage). Our services are sought by private clients, companies, public galleries and councils alike. Our aim is to provide professional service with friendly, approachable manner.

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