Saturday, December 1, 2012

Art Investment

The painting you purchased to match your furniture might just improve your worth or it may possibly be as ‘sell-able’ as that piece of art you made as a kid in art class. As with any investment, you really have to do research and push beyond your  comfort zone.  Art in the marketplace is fickle and there are no assurances you will make a good profit.  Getting out there and looking at the art and really thinking about potential purchases can fill your home with a serious art investment that may perhaps prove a worthy investment in the future and beyond. From experience, the following  recommendations for picking fine art and identifying the Picasso from the puke.


Original Suggestions: Paintings and Giclées
You stroll into an art gallery and fall head over heals in love with a $6,000 piece of art’, but the price is simply just not affordable!  The owner of the gallery points you in the direction of a darn good copy at a very reasonable $600, explaining that this ‘replica’ is what is called a giclées. This giclée can be a machine-made print, or  reproduction printed on very fine paper or canvas with color and clarity that actually seems to surpass the original $6000 price tag. That said, it is still a very good copy.
Being an original is what contributes to this beautiful piece of art having a high value, so an original will always be worth much more than  a reproduction. Whilst a giclée may come labeled with superlatives like “museum quality” or “archival,” and the seller may possibly hawk a certificate of authenticity, it’s going to by no means be as precious as the original. Some artists and appraisers even view giclées as a gimmick for novice artists and neophyte collectors.  Thus, rarely is this a good art investment, but there is more to this story!

Nonetheless, there is no denying that a giclée puts fine art within reach of ‘starting out’ collectors, and while a certificate doesn’t add to the value, a fresh signature and specifically a remarque (an original drawing made by the artist within the margin in the giclée) could really bump up future value (and lend a smile to the purchaser!). You might hear stories of giclées being proudly exhibited at such noble institutions as the British Museum plus the Metropolitan Museum of Art, but the pieces held in these collections are limited edition Iris prints of digital images or digital manipulations – such as “Nest and Trees” by Kiki Smith in the Met. They are not reproductions of original paintings. Museums do, having said that, sell giclée versions of masterpieces to produce earnings (typically in their ‘gift stores’); these giclées, even though pleasing to the eye and soul, will not pull in any future earnings for you.

Carrying out the Loupe de Loupe: Prints and Posters
Maxfield Parrish and Courier & Ives brought art into the homes of America at the turn of the century with their mass-produced prints. These pictures are the predecessors to the giclee with the posters sold in malls and museum shops today. Posters, like giclées, allow you to sit with and admire the masterpiece, but a poster is not the same as a fine art print, which can be in the form of a hand-pulled silkscreen, lithograph or block print.

You’ll be able to often tell the difference between an artist print and poster without too much close investigation.  That said the process of reproduction is getting so much better that in some cases you could need to have a magnifying glass. The process of offset printing leaves a tiny dot matrix on the paper.  As an example, think of a comic book with its exaggerated dots of color.
There are several factors which determine the value of an artist’s print: the number of prints the artist makes of one work; how important the work originally was; the actual condition of the print; and whether it is signed and actually numbered by the artist.  Importantly, a low run of restricted edition prints is far more precious than a mass-produced image.


Cruising Through and Over Art Auctions
A cruise of an art auction is exactly as it sounds: it really is a sea cruise that displays and sells fine art. With name-brand artist prints, drawings and paintings that come hyped with certificates of authenticity, the cruise auction can seem like a real achievement and milestone to an aspiring art investor. The artwork changes each day as lots are sold off and written appraisals suggest pieces are offered at a fraction of their worth. You might feel like you’ve stumbled into a floating investment paradise.
The artwork at these auctions is genuine, but that does not necessarily make it a good investment. Cruise auctions operate on the principle that buyers believe authenticity equals high worth. Unfortunately, authenticity does not guarantee the rarity of a piece or its importance inside the art world. The critical guideline for buying art cannot be repeated too often: art that is valuable is rare.
But how can you know whether you are coming across a rare piece of art? Make sure to study before you buy! Hit the internet café on your ship before you lay down your green (or for that matter credit card). You may Google the artist along with the specific artwork to get some history, and check the big art sites

Your Art Investment
Most people who obtain paintings don’t end up selling them later on, and that fact can skew pricing samples for art. When a painting is auctioned, it is often because the owner very much thinks the piece will attain much larger levels then they themselves bought into. Auction prices are only the tip of the iceberg in terms of art resales.  With some art experts estimating that only 1/2 of one percent of paintings bought are ever resold.
On the bright side and very interestingly, Michael Moses and Jiangping Mei of New Your Universities Stern School of Business have compiled data over the past several years that tracks more than 9,000 pieces of art to verify the long-term appreciation of fine art. They state, “In 2005, the Mei/Moses Fine Art Index showed compound annual returns of 14.52%, whilst total returns for the S&P 500 were 4.9% along with the U.S. Treasury’s 10-year notes returned 2.68%” (“Add Picassos To your Portfolio?”, February 2006). This study says alot.

Art is a good investment
Should you have a true art find that is exquisite and is hanging on your wall and you’re ready to part with it, your best shot at a decent payout will be a fine art auction house, which will typically charge only a relatively small three % commission.  That said, they can also charge as high as 50% of the  sale price for auctioning expense purposes. The do-it-yourself internet auction sites usually draw far less coin. When you choose to sell on these sites, you will have to pay transaction fees that can be as high as twenty percent of the sale price.

After all is said and done, art can be a long-term investment, and even though the art marketplace can be stable or even show gigantic returns on an investment during boom times, it is one asset that may easily plummet to the ground when times are tough – as experienced in recent times.


Final Guidelines for Investing within the Art Investment Community
When you’re ready to start prowling and cruising through the galleries and invest into the future of art, go in with your eyes and ears wide open – be careful of ‘emotional reasoning’. Gallery owners will tell you that buying art is an emotional decision, but do not become trapped by this clever rationale to ‘buy it now’.  Accurate and realistic interpretation of the market and of course being open to what looks good, will take you far!  Visit and explore museums, galleries and art institutions in your local area often and without fail,  so you are able to recognize likely art movement ‘shifters and and shakers in your region. If you’re really thinking about a piece of art by a renowned artist, get an appraisal from a reliable source. Look for top quality and don’t invest in anything in bad condition.  We have come along way in terms of restoring art, but this is very expensive! Using even a small degree of effort, may allow you to make serious connections with emerging artists and be in line to purchase the next  masterpiece that commands a million eyes to take notice!