Art Market Reality Check – artmarketblog.com
-If you are concerned about your works of art losing value because of the current economic crisis you have either bought the wrong works, have a bad art investment strategy or own an entire collection of works you don’t like and wouldn’t want to hang on your walls.
-If you don’t like art and want a good return from your investment then don’t buy art as an investment. You might, however, consider investing in an art investment fund if you have the sort of money required to gain entry.
-An art market correction should not worry art investors who have approached art investment in the right way because such investors will have factored in the possibility of having to sell prior to the end of the intended holding period of after the end of the intended holding period and will have diverse collections to ensure.
-The best art investors are art collectors because art collectors tend to be more interested in developing their knowledge of art and can consequently make better judgments when deciding whether an artwork is likely to be a good investment or not.
-Seven to ten years is the minimum amount of time you will most likely have to hold onto a work of art for that work of art to increase in value enough to provide a descent return and cover the costs of sale.
-Buying one work of art and hanging it on the wall is not investing in art.
-Don’t forget that when calculating your return you need to factor in selling fees and, in some countries, capital gains tax.
-Successful art investors make regular purchases in order to maintain a continual connection with the market and to develop a keen understanding and appreciation for art as an investment. Buying one work a month is a good way of keeping in tune with the art market and developing an understanding and appreciation for collecting and investing in art.
-Most financial advisors that I am aware of have suggested that if you are going to include art in your investment portfolio that 10-15% of the value of your portfolio should be invested in art.
-Art is best utilised as a form of diversification and should not be relied upon to generate a return and should not be the sole component of an investment strategy.
**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications.