If you are keen to invest in art, it is important to understand a few basic
points before you actually start buying the artworks. Here are some points
you need to keep in mind while investing in art market:
Written by Sonal Pawar. A Dubai based art collector and art advisor specializing in South Asian art market.
She also loves to write about Indian art market and art investments.
1. Do your own research.
One of the first things to do before buying art is to empower yourself by
reading up on art, visiting local art galleries, meeting artists/ collectors and
other people who are actively involved in this field. Talk to artists,
consultants and curators to get insights about the functioning of the art
market and to also network with like-minded people intending to buy art
also known as “Collectors” .
You can contact auction houses, dealers and galleries to find artworks
which you like. You can also approach an art advisor. You can end up
paying a consultant 2-5% fee for expensive works. The service for smaller
works may cost 5-15% of the value of the artwork. Fees also depends upon
rarity of art work.
Ensure that the dealers and galleries sell genuine/ authentic works. Check
few important documents while purchasing art like authenticity guarantee,
a provenance certificate, that is the previous owners of the artwork,
condition report, publications (if any). Nowadays, many auction houses like
Sothebys do not provide authenticity certificate. While buying from the
auction houses make sure you understand buyer’s premium and the total
cost incurred by (delivery charge, taxes, etc). Usually when you are buying
through a dealer, only the seller must give commission to the dealer and not
the buyer. This can also be happen when you buy from a gallery. Again this
depends on dealer, gallery and artwork involved.
Also look through a database of past auction results to get an idea of what an artists has been sold for previously.
2. Quality, not quantity.
Invest in fewer pieces that are higher quality. Not all pieces done by a
renowned artist are masterpieces. You must take help from experts to
recognise a masterpiece . For instance, an oil on canvas is perhaps the most
expensive form of painting. Then is an acrylic on canvas, followed by an
acrylic on paper. Then would follow watercolor on paper and charcoal on
3. Buy art that you like and understand.
Allocate a budget.
Buy art that you like. It is something you may keep for a lifetime, as you
don’t know whether you will be able to sell it or not. Unlike other forms of
investment such as stocks, it is worth remembering that art has an aesthetic
quality that can, and some say should, be appreciated outside of its
monetary value. Art is a long term investment. Also, prices of a renowned
artist’s works do not necessarily shoot up when he dies. Art should not form
more than 5% of your total investments. If u are collecting art for
investment purpose then it might happen that u buy an artwork which you
don’t like but u are well aware that it will give you good returns in furture,
here the aesthetic value become secondary.
4. Maintaining the artwork
Once you buy the art, you also need to incur the maintenance cost like
insurance, storage cost. Also you need to take care of the artwork, like art
should be stored in an environment that does not get direct sunlight.
5. Investing in emerging artists
You can look at investing in emerging artists for example in South Asian art
market good works from emerging artists are available from 1500 $
onwards. 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.
6. Prints, limited editions
If you have limited budget, you can also invest in limited edition prints like
7. Evaluating an artwork.
In west countries, art has a much bigger market. These countries have
institutes that value art. In India, we do not have certified institutes
that value art. But the artwork can be valued by Mearto, auction houses and
galleries. Of late, even insurance companies are vaulting artworks.