Though they may be a good option, it is difficult to predict who will make it big in the future. For this, you need to take advice from experts in the field, says Seth. Copal recommends Dhaneshwar Shah, a sought-after artist internationally, known for the beauty of scale he brings by playing with the size and proportion of objects.
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Three years ago, his paintings - acrylic on canvas -- cost Rs 50,, They are now available for Rs 2 lakh, says Seth. However, as an emerging artist does not have an established track record, you need more research into the gallery that represents him and his history. However, for the Indian art world, the recent crash was its first. During the global financial meltdown, the works of most artists saw a steep fall in prices and leaders of yesteryears remained on top See chart on valuations of progressive artists. In fact, after the recession, qualitative work is more in demand, says Thacker, and that too of renowned artists.
Prices of works of a number of established contemporary artists continue to fall.
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This is because a number of buyers of these paintings between and were non-Indians, who are now selling see chart on valuations of contemporary artists. Many private wealth firms offer services wherein they design your portfolio and even store your paintings and help you sell. They have art connoisseurs and savvy collectors on board. You can also tie up with a gallery.
Ideally, buy from an established art gallery or an auction house like Saffronart in India or Christie's and Sotheby's internationally. These also give you an indication of which artists are up for sale, along with prices and a history on their works. Seth says you must check a few important documents while purchasing art - certificate of authenticity, authenticity guarantee, a provenance certificate, that is, the whole chain from where the artwork has moved, and a full-value invoice.
Also, a note on what the painting depicts. These countries have institutes that value art. In India, we do not have certified galleries to value art.
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It is a function of demand and supply of an artist's work, the quality of the painting, its size and the year it was made. Of late, insurance companies have started valuing paintings for the purpose of insuring them. Pawar says the price of an artwork is a function of excess money in the system. As an asset class, it will do very well in a bull market. You may not get huge returns if the market is range-bound, he adds. Since there is no liquid art market, you must buy for end use, says Pawar. Else, invest only if you can afford to put this money away for years to come.
Many times, low-value art can be difficult to sell to galleries. There is something for everyone, no matter their level of expertise. At art fairs you can browse, mingle with other art lovers, ask questions of the experts, compare prices, and evaluate. And, some of the offerings can rival works sold at the most prestigious galleries and auctions. Find dates for local fairs in the art section of your local newspaper, or search the Internet for calendars.
Aside from the obvious activities such as doing research, viewing gallery websites, and networking with other collectors, artwork is being bought and sold on the Internet in astounding numbers these days. Elimination of the high overhead of galleries and auction houses is an added benefit of purchasing online.
Before handling your works of art, make sure your hands are clean and dry, and remove any jewelry. It is also a good idea to handle only one piece at a time, rather than to carry a stack of paintings all together. Pick up a painting firmly from both sides of the frame, avoiding the painted surfaces.
This could cause the canvas to stretch or tear. Without applying any pressure, first brush in one direction completely. Then repeat in another direction until fully dusted. Do not dust if the paint is cracked or flaking. In addition, the environment where a painting is displayed can lead to dust and dirt accumulating, thus degrading the image.
Be sure to store it in a dry place of moderate temperature. If significant cleaning is called for, hire a professional to evaluate and do the job, and never use any chemical or ordinary kitchen cleaners. Remember, the pieces in your collection may be worth a fortune in the future, and the slightest bit of damage can have a significant impact on their value. When storing your collection, keep it out of direct sunlight, away from damp areas such as cellars and basements, and far from heat sources such as fireplaces and boilers.
The more you can shield artwork from frequent and harsh temperature swings, the better. Also, the best way to store multiple paintings for long periods at a time is in a painting rack. This can prevent physical contact among the paintings, greatly reducing the chances of damage. Selling your art, whether individually or as an entire lot, can be as demanding and time-consuming as originally starting the collection. Also, you must take into consideration how much commission a particular venue charges. Shopping around could significantly raise your bottom line.
The advantage dealers and galleries have over other venues is their network of clients. They may actually be able to expedite a direct sale quietly and discretely. Auction houses, on the other hand, charge a much higher commission. Also, a sale at an auction house is a public event, revealing the buyer, seller, and price of the piece.
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Another venue you may choose to explore is the Internet. Sites charge varying commissions to sell your art, so shop around. Investing in art is not for everyone. It can be extremely lucrative, but there is no guarantee the artwork you purchase will appreciate in value. Educating yourself is the single best chance you have to achieve any kind of success.
That means going to museums, galleries, auctions, and doing a lot of research. It also means you cannot afford the luxury of thinking emotionally, as so many claim the act of collecting art can be. For many folks, the world of art is not just a hobby or investment — it is a passion. Many enthusiasts regard art as a historical record of humankind, so open the door and begin your wonderful journey. All Rights Reserved. Money Crashers. About Money Crashers. Recent Stories. Read more.
Brian Davis. Advertiser Disclosure X Advertiser Disclosure: The credit card offers that appear on this site are from credit card companies from which MoneyCrashers. Arto Baltayan. To see this story as an illustrated slideshow, click here. There is no guarantee that your artwork is going to increase in value -- much art is doomed to go out of fashion.
How to Invest in Art – Types, Pros & Cons, Buying & Selling
An individual work or series of works can even decline in value while other works by that artist appreciate. Art can be appraised, but it's not liquid enough to actually mark it to market. An appraised value is no guarantee of getting that price on the secondary market.
In fact, just this week, writer, dealer, and collector Adam Lindemann wrote that he has noticed work is selling for much less on the secondary market than in the primary market -- the opposite of the way the market worked a decade ago: "very often, when you buy a brand new piece in a gallery, my view is that it's worth half the moment you walk out the door," he wrote. Not a great basis for investing, in other words. But then again, some works will increase dramatically in value. All investments carry some sort of risk, and generally the higher it is the higher the reward.
Art is high risk and not always high reward there are high transactions costs and high carrying costs, even if it does appreciate. Thus, art is a luxury asset that shouldn't be considered in isolation: A single Damien Hirst painting shouldn't be your retirement plan. Still, it's not a bad diversification tool, particularly if you also happen to derive emotional value from hanging it on the wall.
If you want to buy art with a small portion of your wealth as a way to enliven your living space while also purchasing a tangible asset, that's great -- just know when you walk out of the gallery that you risk being stuck with it forever. There have been an assortment of recent articles discussing the unregulated nature of the art market, most prominently a front-page article in the New York Times last week.
It's true that the odds are stacked against the new collector. Dealers operate in a murky shadow world, and money flows from information asymmetries. The ones who make a profit off the art market are those who know the industry front-to-back and have the deep pockets to buoy the markets of their artists when interest wanes. It's unequivocally true that the art market is not user friendly.
Making money off art requires having an extreme amount of either luck, knowledge, or capital usually you need all three. If you are new to the market, trying to go it alone is particularly risky -- you are very likely to get ripped off.
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Being smart about investing in art requires a long time horizon. The art world might be confusing, but it's not rocket science. As an investment, art is illiquid and expensive to insure.