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Investing in Art

  • 5 min read

Investing in Art

Art is often seen as an investment, and it is in so many ways, so we thought we would go through the ways art is an investment and what to look for when buying signed prints and original paintings.

Just like the stock market, investing and owning art is not limited to the wealthy elite, as there are many companies with shares available at affordable prices and a lot of affordable art is available too, from signed limited editions to original paintings.

As a general guide, we recommend looking for art that you love and want to own for a lifetime. Art is an investment in your life, the enjoyment of your home or office and your relaxation, so those are the guaranteed returns that art can provide in abundance.

Just like stocks and shares you shouldn't expect a guaranteed up and to the right rise in value of any art you own.

Art certainly does deserve a place in a varied portfolio of investment assets alongside property, bonds, savings and stocks and shares. Unless a physical disaster strikes or theft, the artwork is very unlikely to go to zero value, as a company might if it ceases trading, but it is also very unlikely to hit a home run like Apple, Netflix, Starbucks or Tesla investments or a stock market tracker fund.

One of the benchmarks for art values is Art Market Research which takes data from all the major auction houses, but this index doesn't track data from private galleries, and it can be many decades before contemporary artists start to have work being sold at auction, so unless you are investing in very established historic artists, and often deceased artists, it isn't very useful. If you are buying lots of art in the hope that one or some of the pieces will be the next Banksy, Hirst or Hockney then your risks are high as many original pieces of art will inevitably have to be enjoyed just for their decorative qualities as it is almost random which artists go on to gain large future price rises and often big business gets to decide that by bulk buying, hoarding and then releasing years later.

How to choose artists to invest in

So you have decided to buy some art to enjoy in your home or office and if you are not worried about an investment thesis then simply buy what you like.

If you invest £5000 in a painting that you don't like, just because you expect its value to rise, then you have missed out on the main benefit of owning art over other assets. You should LOVE the art you buy and it should radiate positive energy to you as it will benefit you every day.

If you want to have a better chance of the art appreciating or maintaining its value over time there are a few things you might want to consider.

How to choose artworks to invest in

  • Buy art that makes you happy.If it makes you happy the chances are other people will love it too and that adds to its value.
  • Choose artists that already have their art in the permanent collections of well-known galleries and institutions. ArtUK.org lists many artists whose work is part of the UK's public collection. This list is only updated every few years, so it isn't definitive and most artists should be able to advise if their art is already in a public collection. Artists John DyerJoanne Short and Ted Dyer all have work held in the UK's public collection.
  • Choose artists with a great story and background. Well known Cornish artists already have a great story and history supporting their future art values. Cornish artist John Dyer's paintings have increased in value by a multiple of 10x over 20 years and St Ives artist Bryan Pearce, who died in 2007, has now seen values leap over 35x since his death.
  • Choose artists who have been exhibiting for many years.
  • Avoid recently graduated artists. Let the artist's career develop for a few years, as artists sometimes  give up before success and then the work is worthless apart from the joy of owning it.
  • Be wary of 'emerging artist' investment recommendations - this is a bit like investing in penny stocks - very risky - it's better to watch from the side lines for a few years or join an artist's story once they have had several exhibitions and you can see there is longevity and a real story to be part of.
  • Look at the timeline, genre and how your selected artist fits into this. In Cornwall, there is a clear artistic timeline that a few contemporary artists fit into and continue to create history on, but there are thousands of artists who don't.
  • Choose 'real' artists and not illustrators who are copying and creating for a trending market. Look at artist biographies and try to work out if they are the leader in their genre or a follower, you want to buy leaders and first movers,not copycat artists. Is the artist painting their story, their experiences of the world or just jumping on an existing trend and creating less expensive versions of a better known artist's work? There are now so many 'horizon' painters in Cornwall who have all copied artist Kurt Jackson for example.
  • Buy well-known artists as the price difference between new artists and established artists can be quite narrow, however, the future potential values could be radically different. It's possibly better to have a smaller piece from an established artist than a large piece from an unknown artist.
  • Published artists. If there is a published artist book about your chosen artist, a range of art prints, cards, licensed use of their images and a general buzz and excitement then that can be a great sign that you are buying into a solid artist with great future potential.

One thing you can guarantee when investing is art is a visually better home and working environment and a sense of well being

There are no guarantees to future values when buying art and you should always love what you’re buying and be happy to simply own it, enjoy it and have it on your walls for a lifetime and to potentially hand it down to another generation without looking for a monetary future value.

If you are interested in the investment side of buying art then acquiring works by well known Cornish artists like John Dyer, Joanne Short and Ted Dyer is a great way to start. We suggest for investment and longevity to always try and buy an original painting, failing that a signed limited edition print produced using a giclée process on watercolour paper, but an original painting is a one-off and will always have a better future value whichever artist's work you buy.

If you are really not interested in owning or investing in affordable art for your home and benefiting from it on a daily basis you can simply look at investing in art with companies like Masterworks who run funds so you can buy fractional shares in famous artworks from artists such as Banksy, Rothko, Haring, Calder, Picasso, Renoir, Chagall and more, but that is a very different way of owning and investing in art.

N.B. None of the content of this blog is investing advice. For further thoughts on investing in art read this informative blog.