Art & Investing
The Myth of Investing in Art
Art is a special asset class and requires more involvement than other forms of investments. Artworks are by definition unique (unlike shares, where it does not matter which one you own). So it’s worth to do your due diligence before you buy.
We don’t think it is wise to buy a work if you don’t love it. Unlike other investments, you will not get any monetary interest or dividends while you own it – “just” enjoyment, so it’s important to like what you buy.
However, just loving an artwork doesn’t make it an investment, either. Thousands of art buyers have purchased art in good faith, only to be bitterly disappointed when they wanted to sell their ‘good investment’.
Here is what Brett and Sue say about our advice:
“We have come a long way in our art education thanks to David and Brigitte, having first met them to authenticate and value paintings. Their professional approach and knowledge of the art market has been instrumental in providing us with the skills and confidence to build a significant art collection.
We have used many of the services offered by Banziger Hulme Fine Art Experts, including authentication, valuations, pre-purchase reports, auction bidding as well as arranging the re-framing of several artworks. David has also “curated” our collection, just as he has curated many public exhibitions. David has a great ‘eye’ for this and the difference it made was nothing short of amazing.
When buying art it is sometimes difficult to decipher between factual information and “sales pitch”. This is where the expert advice offered by Banziger Hulme is invaluable because it is always honest, trustworthy and impartial.
If you are considering embarking on the exciting journey of Art Collecting, then we highly recommend you take David and Brigitte along with you, as they make great travel guides!
David is talking about art as investment and the expert advice you need here.
Read more testimonials from satisfied clients.
Consider the resale value
If you buy art as investment, it is essential to consider the resale value – is there any at all? We believe that of all art sold, only about 10 % will retain its value after sale.
However: if you inform yourself on the artist and his work and you are happy to spend $ 5,000 or $ 10,000 on a painting that has no re-sale value, that is fine of course, too.
But not too many art buyers can afford to spend larger sums without thinking. With art, you actually can consider the resale value – unlike with most other goods, which never hold, and even much less increase, their value.
We believe that when an artwork maintains its value, it represents already a good investment. Capital gains would be achieved over several years, not in the short term.
And measuring the performance of art can be very tricky, as there are so many different factors to consider: the artist, the period, the medium, the individual artwork, development of prices over a period of years.
I am ready to buy. What do I do?
If you decide to buy art, our first advice would be: wait, don’t buy. Train your eye by visiting public and commercial galleries and also art fairs. Speak with gallery owners and people who have bought art before. Learn about art, read books and art magazines.
We also firmly believe that buying art is for everyone who is interested. All you need is the commitment to pursue art, and find out what you like. Set aside a budget, which can start from under $ 1000, and be prepared to wait before you make your first purchase.
To help you in this process, it is a good idea to get to know experienced gallery-owner and artists personally. A relationship with an independent art consultant will provide you with completely unbiased information and advice.
When you are ready to buy, use these general purchasing guidelines:
* Set yourself a budget
* Buy what you like
* Buy a good name
* Buy from a reputable source
Buying at auction requires thorough research on the artist, his works, his periods and techniques as well as his prices. A work sold through a reputable auction house is validated and can be resold at a later date.
Purchase works by emerging artists from cutting edge galleries – this is higher risk, but lower outlay – and you get to enjoy contemporary art, while supporting a young artist.
As art consultants with excellent contacts in the art industry, we are uniquely equipped to assist you both in buying at fine art auctions and through the best art galleries. We are Approved Service Providers (Valuers and Consultants) with the Australian Antique and Art Dealers Association.
See how we could help you achieve your art goals with our art advisory service.
If you would like to find out more about your art, just contact us with your enquiry.
If you would like to get more information and tips on art, fine art auctions or investing in art, you can join our mailing list here.