Art has been an asset class for many years, but despite its long lasting history it rarely features as an obvious and regular investment choice for the majority. It is viewed as an asset class for the rich, one where only the elite have access to, however over the past ten years things have changed dramatically.
Technology has made art visible and accessible to all. With databases and records of past sales now freely available it makes valuing art a much easier task than it once was. The introduction and popularity of prints has meant you can now invest with just a couple of hundred pounds. Below we explain the three ways art can be bought to those that are looking to get that toes dipped into the water.
Similar to financial markets for equities and debt there is a primary art market where artists first release their works. This is often done through solo shows or via galleries. Those artists that are in demand will often sell out works in minutes so it's important to follow these artists and galleries for pre-releases. Examples of primary market dealers are below
-Hang Up gallery
This is where the majority of art is traded and very often this is where primary market purchases can be sold. Auction houses are the most popular places to pick up pieces of art, however the transaction fees can be very high(20-30%). It is therefore better value to buy artwork privately. Often through brokers or galleries that often take a much smaller commission (5-10%)
-Urban art association
Direct from artist
Lastly, and often the most difficult is buying from the artist direct. Very similar to private placements in financial markets this is often only the option of a very select few who have strong connections with the artists. Often supporting them from very early days.
With further technology changes it will become possible to purchase shares in artists works, further opening up the art market to more and more people. The introduction of blockchain technology is already having an impact as a few start up firms introduce shares in artists works. This should, and I believe will, open up the art market to more and more investors.
For more information and where to start on investing in art, please don't hesitate to reach out.