Art is investment.
According to our first guest lecturer, Anders Petterson, art is a sort of financial asset now. This market have changed from long-term collective market to more short-term financial market.
I found some articles reflect this concept from the internet.
investment in art market
Jon Reade, director of Art Futures Group said, “Liking the artwork is secondary. Not liking it is even better if you’re planning to sell it in three to five years. It’s always better to take the emotion out of it, just like any other investment.”
Art is one of the pathway to earn money, and some investors do not even like it! They see it as an investment about earning approximately 12-18 percent per annum. Moreover, somewhat surprisingly, Jon Reade also mentioned that about a quarter of his clients are under 30. It means there are more young investors have aware of this market and start getting involved in it. It also shows that this investment market is now rapidly growing up.
There are various types of players in the art market, including high net worth individuals, collectors, art dealers, corporations and museums. However, due to the fact that an abundant of market segment is executed through private transactions, detailed information mainly comes from public auction houses like Sotheby and Christie.
motivations for buying art
It is important to understand what drives the art market. Although some people take art as a purely investing tool, there are other motivations existed. Art provides collectors who has social status and prestige the way to expose their wealth and taste to others. Art has actual non-financial value, for example, the cultural value. Some investors purchasing purchase art for philanthropic benefits by financing young and up-and-coming artists. They make an investment of culture that artists may have.
In order to be seen, artists should build up their reputation through getting involve in channels like special art events and let people discuss their talent. Without these channels or marketing, talented artists would never been known by public.
The factors which can influence prices for artist’s work include the popularity and reputation of an artist; views of art critics and commentators; the quality of the art work; the subject; previous buyers especially if they are celebrities or high profile collectors (red rag , n.d.).
It is very sad to know that art should be sold, be marketed and be priced. I thought artists may lose their faith, personal ideas and style very easily in order to meet the market demand. But in other way, artists can be invested with their reputation and develop their skill and own special style through those investment.
Reference
Lifestyleasia (2011) 5 Things You Need To Know About Art Investment. Available at: http://hk.lifestyleasia.com/features/Entertainment/5-things-you-need-to-know-about-art-investment-9013/ (Accessed: 20 Oct 2013).
Forbes (2012) Ten Expert Tips For Investing in the Art Market. Available at: http://www.forbes.com/sites/abigailesman/2012/03/26/ten-expert-tips-for-investing-in-the-art-market/ (Accessed: 20 Oct 2013).
Sommer, K. The Art of Investing in Art. Available at:https://www.jpmorgan.com/tss/General/The_Art_of_Investing_in_Art/1320507612236 (Accessed: 20 Oct 2013).
Red Rag Modern art gallery (n.d.) Investing in British Art. Available at: http://www.redraggallery.co.uk/british-art-investment.asp (Accessed: 20 Oct 2013).
Flora 