What You Must Know Before Buying Art as an Investment
- Ahmed Kheder
- Jul 3, 2022
- 6 min read
Updated: May 27
Art has always held a special place in human culture, acting as both a reflection of society and a vehicle for personal expression. While it’s often considered a way to beautify spaces or capture fleeting moments, art can also be a powerful and lasting investment. However, choosing the right artwork to invest in goes beyond just liking what you see. It involves understanding the factors that contribute to an artwork's value and long-term relevance.
In this article, we explore the key elements that turn a piece of art into a good investment, from durability and uniqueness to emotional impact and the artist's philosophy. By evaluating an artist's potential and the story behind their work, collectors can make informed decisions that go beyond superficial appeal, ensuring that their investment stands the test of time.
Key Factors That Make Art a Smart Investment:
Durability... Art is a Timeless Message
Art is a timeless, subliminal philosophical dialogue between the artist and their audience. A true artist uses emotion to explore and redefine the fundamental principles of humanity.
For a true artist, creating art is often a profound ritual—a way to illuminate humanity's path toward a brighter future. When evaluating a piece of art, aspects like light, shading, color palette, or technique are important, but durability is key to transforming art into a lasting investment. A valuable artwork must possess the strength to endure the test of time, remaining relevant and impactful for generations to come.
What Makes a Painting Unique?
The principles of demand and supply apply to art as well. For artworks lacking uniqueness in subject expression, style, or technique, the potential for their value to increase is minimal.
Scarcity naturally drives value, and an artist's distinctive style is essential to limit supply and create demand for their work.
Uniqueness can stem from various factors—the story behind the artwork, the technique employed, the composition, the message conveyed, or even breaking conventions, like the occult abstraction paintings of Hilma af Klint.
However, it’s important to note that what was groundbreaking a century ago may no longer be innovative today, and what was considered contemporary yesterday may feel outdated today.
Evaluating an Artist's Potential Before Investing
Before investing in new artwork, it's essential to evaluate the artist's potential. Start by examining the artist's signature on the canvas, then review their portfolio to observe the progression of their skills over time.
A diverse portfolio showcasing versatility in styles (such as realism, impressionism, or expressionism), techniques, and subjects (like landscapes, still life, or figurative works) is a strong indicator of the artist's professionalism. Without such versatility and growth, collectors risk purchasing works from a hobbyist rather than a seasoned artist.
The Impact of the artwork on the viewers emotions
The artist employs their mastery of light and shadow, a full range of colors, and strong compositions to craft an emotionally powerful piece of art that communicates their philosophical perspective directly to the hearts of viewers. An artwork that evokes emotional impact and captures the audience's engagement is truly a valuable investment.
The Philosophy that the artwork conveys
Art is a timeless message from the artist to their audience, where a true artist uses emotion to explore and redefine the fundamental concepts of humanity. For the true artist, creating art is a ritual that illuminates the path toward a brighter future for humankind.
Before investing in a piece of art, it's important to first consider the message the artist seeks to immortalize. The true measure of the artwork lies in the artist's ability to convey that message to the hearts of the viewers, far beyond just light, shadow, color palette, or technique.
What You Need to Know from Art Collectors Before Collecting
Art collecting is not a piece of cake, it’s not just a random process, you need to be careful in order to invest in the right piece of art. So, let’s take a look at what you need to know before collecting, as said by experts in this industry to help you start your journey through art investment.
The first thing you need to know when investing in art is the “Why”: According to Natasha Arselan, an art collector and the founder of the Natasha Arselan Gallery and AucArt, an online art platform that specializes in emerging artists “You have to always know your why" she also said " “How you approach your journey of collecting and investing – what you collect, how much you spend. It all depends on your reasoning.” Of course, there is no wrong or right regarding your why, it differs from one collector to another.
Appraise supporting emerging artists: The patron and collector Valeria Napoleone says: “I am very attracted to making an impact. I support young, talented artists because I know it will mean a lot to them at a time when no one else is looking,” She adds: “You can support them in different ways – it’s not just about buying the art. Through my initiative I host dinners for artists, I engage in conversation, I support publications, and I connect people. Little gestures make a lot of difference. It’s not always about how much money you have.” Valeria Napoleone's own initiative especially supports underrepresented and female artists.
Know where to search: After deciding why you want to invest, you need to figure out where to look. Art collectors have different opinions about this. Lisa Schiff, the art advisor for the Leonardo Di Caprio Foundation, suggests getting involved with a non-profit organization. she says: “It’s a great way of getting into the art world. Studio Voltaire is a fantastic example,” she also suggests well-respected galleries and she talked about her favorites: “Stuart Shave and Sadie Coles are always favorites for me.” On the other hand, Arselan recommends AucArt as a premiere destination with impeccable provenance for all its art pieces, however, online marketplaces are a perfect place to purchase art according to Angie Davey, former creative director of Eyestorm: The beauty of browsing art online is that you can look at 100 times more than you can in a gallery and your legs are a lot less tired than after trawling round an art fair,”
Research is important and so is your gut feeling: Arselan mentioned that if you're passionate about a piece of art and you like it, you need to look into the artist. So, is there a good or bad sign when looking into the artists? As a matter of fact, if the artist's work is being flipped, if it increases in value too quickly, for sure, that's a bad sign because that means it's not generally sustainable. According to Areslan " “Check if the work of the artist is being flipped – if it goes up in value too quickly. That is a bad sign because that is not generally sustainable and you can check that though the auction house results or check on Artsy to see the pricing,” she adds "Other red flags are if an artist goes to auction too young because they lose often control of their market.”
NFTs are important to explore: The arrival of NFTs is the biggest development in the art world. According to Jonathan Bixby, Executive Chairman of NFT Investments "“The revolution of NFTs is simply that belief going digital and going global.”
David and Ezra Nahmad :
These two are brothers who own the most valuable art collection in the world; however, they are not fond of art at all, strange, right?
And they're not the favorite pair of art collectors too, in the following lines, you will know why...
So, who are they? They are businessmen through and through and the name of their game has a singular goal which is selling for a profit. The value of the collection is $3 billion.
They treat art collections like not much more than a dollar transaction and this is not strange because of their backgrounds in investment in banking and blackjack.
How do they invest in art? They buy expensive art pieces, store them for a period of time and then re-sell it for maximum earnings. On the other hand, we can see that they have thought of everything really well - no surprise- because their storage unit is close to Geneva Airport and of course it's tax-free.
What to find in their warehouse? up to 5K artworks at any given time, 300 of which are rumored to be $900 million worth of Picassos -yes, that's true-.
Their motto is “business is business” and artists like Monet and Picasso are brands just like Apple and Pepsi.
Conclusion
In conclusion, investing in art requires a thoughtful evaluation of multiple factors that contribute to its long-term value. Durability, uniqueness, the artist's potential, emotional impact, and the philosophical message conveyed are all key elements to consider. Art that stands the test of time, captivates with its distinctiveness, and resonates deeply with viewers is not just an aesthetic investment, but a meaningful one. By carefully assessing these qualities, collectors can ensure they are acquiring works that will continue to appreciate in value, both emotionally and financially, for generations to come.
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