The Art of investing in Art

By Frédéric Clerc-Renaud

PICASSO Pablo - WARHOL Andy - LICHTENSTEIN Roy - HOCKNEY David - DALI Salvador - CHAGALL Marc - MIRO Joan - MATISSE Henri - MONET Claude - BLAKE Peter
Jeff KOONS

Millions of dollars paid for works of art everyday. Broken records.140 millons dollars paid for "adele block bauer" prtait by Klimt .
Have they gone off their head these collectors fighting for a sculpture or an oil painting for sale at an auction. What the hell is doing the value of a work ?
Basically, a sculpture or an oil canvass is exactly the same thing as a bottle of wine and obeys the rules of supply and demand. In fact the price for an object can raise as high as the price one is ready to pay for it and considering that huge amounts of money are available in the hands of wealthy collectors, eventually there is no wondering of soaring prices in art.

Born 1955, Koons is one of the most expensive artist in his generation, and his works, world famous, reached tremendous prices. five million dollars in 2001 for Mickael Jackson and bubbles. Anyway this doesn not means that this will still be the true value in a few years. Art prices fluctuate and it is not unusual to ear of collectors having paid huge sums to an artist and unable to get their money back when selling a few years later. See Corot for example. It was worth millions two decades ago and today his works are being nearly sulked by the public.
There is obviously a fashion effect to be taken into account, which has nothing to do with the real value of an artist. Investors are perfectly aware of this and do the most of it. Take a Midas, ask him to buy artcraft from an emerging artist when his prices are still rather low and he is starving to death and striving to survive. Then when he has a nice collection, suggest him to sell a few works at an auction. It does not mind that the artist is unknown. The most important thing is the seller. Midas is very famous, so famous and so wealthy, most certainly he has the gift of business and if this man bought these works it is certainly to make more money. So everybody in its own gold rush, place bids to get one of these collectibles and prices soar. Now the unknown artist is famous and profitable just like a coca cola bottle. This is art apparaisal !
Gallery owners are playing the same kind of game. They are supposed to be good at finding golden ore and people believe them when they are being coaxed into buying artcraft from one of their cherished artists.
Anyway the gap between riches and not-riches is so huge that tryng to explain what is expensive and what is not is to no avail. Probably 5 or even 50 millions dollars is correct if not normal when you are used to handling easy and heavy banknotes.

Most of the time you are off this world and you have nothing else to do but buy cheaper and maybe better artists. Notice that the best way of appraising an artwork is finding what mark was hit by one of the works from this artist you are ready to buy from. Check carefully catalogues from auctions, and keep in mind that it is not unusual practice when an artist or gallery owner requires from a third party that he places bids on his behalf with a view to boosting the price, no matter if he is thus running high risk of paying fees for a fake sale.
This is the price to pay to grow famous.

It reminds me of a World War Two veteran , famous in business, who told me, that the best tool ever in marketing is your nose.

Certainly you may trust yours as well when you are considering Investing in Art

Read this article in Artprice
Read this article here

Return HOME PAGE