Invest in art now? As the UK crawls through yet another lockdown, investing in art may be low on your list of current priorities. Far from savvy, investing in art may seem like a terrible idea in the current financial climate, ravaged by Brexit and the pandemic.
Last spring a letter, signed by over 400 artists and creatives, including Grayson Perry and Nick Cave, went viral. It warned of a ‘cultural wasteland’ developing in the UK if the government did not step in to support the struggling arts and culture sectors. Rishi Sunak’s controversial comment that those in the arts should “retrain and find other jobs” did little to inspire confidence.
So, why invest in art when the industry is apparently on its knees? The British-based estate agent, Knight Frank, has been carefully monitoring the changes and fluctuations of the art market through their arm Art Market Research. Their recent report found that despite a cataclysmic year, over the last five years, most collectable pieces have risen in value by a staggering 160%.
Unlike more volatile shares in stocks, art is an asset that doesn’t rise or decline with the financial market. In fact, art nearly always appreciates over time. For those with a serious investment in stocks, investing in art is also a great way to diversify your portfolio and minimise risk. It’s no wonder that last year, leading gallerist David Zwirner, suggested that 2020 was a great year to invest in art.
Indeed, with many people stuck at home and unable to spend, some may find themselves with more disposable income. Choosing to use that money to invest in art is both a lifeline to artists and galleries struggling through the pandemic, and a potentially lucrative financial decision too.
In this article, we offer advice and tips to those looking to invest in art, including insight into how the market has transformed over the past few years.
The changing art market
Too often, the art world is synonymous with exclusivity rather than inclusivity. Since the Renaissance period, art has served as a status symbol for the elite who could display their wealth and power through the oil paintings which lined panelled hallways and dining halls. Centuries later, this association is still hard to shake off. Even today, to those outside this elite remit, buying artwork might feel intimidating.
However, the art market is rapidly changing. Love it or loathe it, technology is revolutionising the world around us and helping democratise the art market. As art moves online, to online galleries and social media platforms like Instagram, a wider range of people have immediate access to a wider range of art.
Whereas auction houses can overwhelm the novice art buyer, online platforms offer clients the chance to deliberate their options at their own pace. A newcomer to the auction house might also be surprised by the nasty buyer premium levied on their purchase. One additional benefit of buying on websites like ours, is that the price listed is the final price you pay (excluding delivery costs).
But in a saturated market, with thousands of artists at your fingertips, how do you know you are making a good investment?
How to invest in art: insider tips
acrylic on canvas.
Size: 120 x 90cm
Look for artists with links to prestigious schools and prizes, like Emmanuelle Revel-Pellet, who was head of the Art Teaching Department at the Louvre for a decade.
A wider range of art available to a wider audience, what’s not to love? Although immediately appealing, without the guidance of industry experts, there is a high risk of choosing an over-priced piece and making a fruitless art investment. This is fine if you are after a purely decorative artwork, but for those looking to make a shrewd investment, the risk can be perilous.
Our founder, Richard Baker-Howard, has over 20 years’ experience navigating the art-market, both in Europe and Asia, over which he has refined a discerning eye for talent. One of the major benefits of choosing to buy through a gallery is the assurance that the artists — and individual artworks — have been handpicked for their quality and artistic merit.
So, what are our tips and tricks to those looking to invest in art?
Should you diversify or specialise your portfolio?
Besides the obvious advice to invest in original pieces, the new art buyer is confronted with two ways to approach collecting. One option is to choose a specific topic or genre to specialise in. This might be something like British landscape art, figurative pop-art style pieces or Cubist, Geometric, Suprematist pieces. Another approach is to diversify your collection, and to invest in art across multiple genres and styles.
Our advice? Choose a topic or style you are genuinely passionate about, learn as much as you can about it, and go with your gut. Over time, as you research and invest in a specific genre of art, your intuitive grasp of what’s good (and what’s not) will intensify. Also, our appreciation of art is an emotional, instinctive experience — if you like something, it’s likely someone else will. If you want to make investments led purely by rationale, stick to investing in bonds.
Good things come to those who wait
Art investment is not a get rich-quick scheme. Generally, you should wait around 10 years after acquiring a piece to sell. This is another reason it is so important to love what you buy, as most likely, you will live with the work for some time. For some, this makes it unappealing to invest in art, but for others this is part of the joy. You may be in for the long haul, but art is one of the rare assets you can literally kick up your feet, sit back, and enjoy in the meantime.
But when the time does come, how do you know when to strike? Keep up with the artist’s developments after buying. Make sure to follow the gallery and the artist’s social media pages, and consider setting up a Google-alert on the artist’s name, or the genre of art you have invested in.
Invest in art and invest in the artist
The value of an art piece depends upon the trajectory of the artist. For this reason, it’s important to research as much as you can about the artist, their background and their story. Look out for artists who have won awards and prizes, or whose work has received recognition and publicity by media outlets. Pay attention to any formal training that the artist has and make a note of which art school they attended. Remember, art-schools and art-awards certainly aren’t all built equally, so look out for prestigious names like the Royal College or Art or Central Saint Martins School of Art and Design.
We are lucky to showcase a range of prestigious award-winning and formally trained fine artists. You can read the biographies of all our artists on our website. If you would like to learn more about one of our artists, or want more in-depth advice about how to invest in art, get in touch.