(The Telegraph/Mutual Art.com)
Is art a viable alternative investment?
Buying art can reap financial rewards – if you know what you’re looking for, says Alison Steed.
Investing in the markets when they are as volatile as they are at present may not seem that appealing, but if you prefer to take a view on some of the finer things in life, then you might want to consider some alternative investments.
Putting your hard-earned cash into the likes of fine wine, classic cars or artworks may seem like a frivolous activity at first suggestion, but there is serious money to be made if you invest in the right items. For example, Edvard Munch’s The Scream – one of the world’s most famous paintings – was sold earlier this year for a record $119.9 million, making it the most expensive artwork ever to sell at auction.
This was not a one-off either – at a recent Sotheby’s auction in France, a number of pieces sold for record values for the particular artists, suggesting there is an increasing appeal for great artwork among the collectors.
Both Christie’s and Sotheby’s have seen significant boosts to profits in the past six months. In Sotheby’s Summer Season of Sales in London, it achieved a combined total of £268.8 million, with the Impressionist and Modern Art Sale series realising a 12 per cent increase in the same period last year.
Christie’s has seen its worldwide sales reach £2.2 billion in the first six months of the year, a rise of 13 per cent on the same period last year, which it said “represents the highest total for a corresponding period in company and art market history”.
Steven P Murphy, chief executive officer at Christie’s, said: “We’ve seen a steady increase in sales at Christie’s driven by three key factors: growing worldwide demand for art, the quality and curation of important consignments and our consistency in offering the best service and broadest choice to our clients.”
It saw bids from 124 countries, with a 31 per cent rise in Asian clients looking to bid in New York and London. The impact of the internet is key to the widening appeal and accessibility of auctions, and Christie’s plans to capitalise on this with a series of “online-only auctions for a global collecting category in August with a sale of fine and rare wines”.
Henry Wyndham, chairman of Sotheby’s Europe, said: “We are extremely pleased with the strong performance of our Summer Season of Sales. Bidding across this range of categories came from no fewer than 62 countries across all regions worldwide.”
In addition, 13 per cent of bidders were new to the auction house, said Mr Wyndham, suggesting a widening appeal of artworks.
Major artworks get the highest profile, but there is increased interest at all levels of the market. For example, Christie’s South Kensington saleroom, which offers works of art from under £1,000, built on two consecutive years of record sales, recording its highest ever total for a corresponding period.
The message from all of the experts when it comes to investing in art is clear – you need to buy something you like and not concentrate on its potential future value.
Matthew Paton of Christie’s, said: “The value of art is subject to people’s taste, and you can’t judge future taste. The market goes in cycles, and strong prices encourage owners of other works of art that they can benefit by earning from their art.”