As well a joy and passion, art can also be a worthy long-term investment. Collectable art expert Kerry-Anne Blanket talks us through the best way to invest in art and why you should.
I’m not art expert, but I do like buying pieces which appeal to me and I take an interest in art auctions. In the past I did reasonably well on a collection of Charles Blackman prints and I love my Max Dupain photos, particularly his beach series.
Art collecting has a long history and it’s certainly the most aesthetically pleasing way you’ll ever invest your money. If you’re intrigued to learn the how to invest in art, collectable art expert Kerry-Anne Blanket, from KAB Gallery outlines the top things you need to know.
1. Learn about the market
Given we’re now spending more time in our own homes, art investment can be a clever way to acquire an appreciating asset that you can enjoy for years before you decide to sell. With that in mind, Kerry-Anne recommends spending time researching the various art styles – and the artists who create them – to get a general feel for the type of artwork you are interested in.
“Look at important art prizes and consider both the judged winner, as well as the people’s choice. Additionally, narrow your search to concentrate on just a handful of artists that you like, so you can become as familiar as possible with the market for their work,” Kerry-Anne says.
2. You don’t need to be an expert, but you should talk to one
“There are so many facets of the Australian art market, keeping up to date with the entire spectrum is a full time job,” says Kerry-Anne. “I really recommend finding a gallerist who is immersed in the industry and talking to them.
“A reputable gallery will be constantly monitoring the art market for growth opportunities. For example, at KAB Gallery, I’m tremendously selective about which artists and work I choose to stock, selecting not only high-quality original works, but those that I feel will hold or increase their value over time, based on what I know about the market.
“Be sure to ask the gallerist lots of questions about the artist’s sales history, what prizes they may have won, their art-making process, how their works are selling on the secondary resale market and about their future projects and upcoming exhibitions. Again, a good gallerist will be happy to talk through these questions via phone or email and really guide you through the buying process.”
3. Only touch originals
“When buying for investment purposes it’s vitally important to ensure you are purchasing an original piece of art,” says Kerry Anne. “Even if the gallery presents you with a high-quality giclee print which is identical to the original image, it’s important to remember that it is only a copy.
“The rarity and originality of an artwork contributes substantially to its resale value. So I can’t stress this point enough – without rarity and originality, you’re handicapping your potential investment return, even before you begin.”
4. Buy something with broad appeal
When looking for a piece of investment art, one of Kerry-Anne’s most important tips is to purchase work with a broad appeal. This allows it to stand the test of time and attract buyers when it comes time for you to sell. Kerry-Anne suggests look at “People’s Choice” awards to confirm you are in the right track.
At the end of the day, any art investment only has a value if someone is willing to buy it from you. So investing in something others will like down the track is so important.
5. Weigh up the risks
Like any investment, it’s important to consider the risks before you invest in art. “Ideally, though not always, good art will continue appreciating in value over time. But like any investment, investing in art carries risk, so it’s important to choose well and wisely,” Kerry-Anne warns.
“Like any market, the art market has its ups and downs, and given the subjective nature of art appreciation, artists who were once in favour can just as easily fall out of favour. On the plus side, one of the perks of art as an asset is that its value doesn’t tend to rise or fall with the stock market, so even if the stock market takes a dive, your art investment is likely to hold, or even increase in value.”
6. Play the long game
Kerry-Anne stresses that profits from art won’t happen overnight. So art is generally not an investment for those looking to make a quick dollar.
“I would say art investment is definitely for the patient, and you should be looking at a time window of at least 10 years or more before you look to sell,” she say. “While there are exceptions to this rule, especially for an artist with an already proven sales history, they are few and far between, and you would likely be short-changing yourself to sell earlier.”
7. Make sure you love it
“Most art investors start out as collectors, so if you’re already looking at buying a piece of art for your home, it makes sense to turn this genuine interest into an appreciating asset,” says Kerry-Anne. “Generally my overall advice is to consider the aesthetic pleasure first, and the financial benefits second, because then the enjoyment of your investment is immediate and consistent, regardless of whether the markets rise or fall.”
On the other hand, Kerry-Anne suggests that if you really don’t enjoy art for art’s sake, there may be other investment avenues better suited to you.
8. Look after your investment
If you’re buying an original artwork with the intent to sell in the future, you need to be responsible for keeping that artwork in pristine condition, advises Kerry-Anne. “The artwork needs to maintain its original quality, so you need to factor in conservation aspects such as temperature, humidity and sunlight. If you put it into specialised art storage you’ll need to consider the fees associated with that over time, as well as insurance should you choose to go down that route.
“Also be aware that some mediums, particularly delicate works on paper, are riskier to store as long-term investments than a work on canvas, for the simple reason that the paper itself is a much more fragile medium than a quality linen canvas.”
9. Do your research and sell with confidence
Another important consideration if you want to invest in art is what happens down the road. When it comes time to sell your investment, again this is the time to bring in an art expert to gauge their estimate of the value of the work. That way you can enter any negotiations with all the information you need to make a winning deal.
“There are several avenues through which you could sell your investment, ranging from a private sale negotiated directly between yourself and another collector, to selling it on consignment (or even directly to) a gallery, or selling on the secondary market via a reputable art auction house such as Smith & Singer, Leonard Joel, or Davidson Auctions,” advises Kerry-Anne. “While an auction is usually the quickest and cheapest no-fuss option for selling your work, it is essentially a wholesale market, so the price you receive generally is a reflection on those benefits.”