Art as Investment

Posted by Tony Malone on

The art market has grown steadily and significantly over the last century, with very low correlation to other asset classes. Despite recessions and economic deflation, art has still maintained it’s value and continues to appreciate each year.

Art investments is one of the world's most successful forms of passive investment with some investors seeing a 64% return within the first 12 months in some cases.

As art has no correlation to the stock market, it means paintings can go up in value even when the market crashes, making it a good diversification for an investment portfolio.

Previous financial sector data based on examining data from 1.2 million auction house sales of paintings, drawings and prints, concluded that art appreciated in value by a modest 3.97% per year, in real US dollar terms, between 1957 and 2007. - Of course given the current environment of low interest rates, that's still a better return than many savings accounts will give you.

Deloitte art & finance co-ordinator Adriano Picinati di Torcello says "paintings are also seen as attractive investments because it's very clear what you're buying".

Even here at Tony's small art studio we have seen valuations for insurance and resell values of past works rise.  For instance "Orion Belt" a watercolour painted and sold in 2005 for £600 was sold in December 2020 for £6500 at a private gallery in Central London.

Tony's advice is buy art because you love it, you are excited or moved by it. But don't forget to insure it and care for it. Should you ever need to sell it, re-authenticate it with the artist and then approach a reputable gallery or auction.