If you’re into fine art, then art very well may be the greatest investment you’ll ever make.
Ok we’ve all heard about the staggering price art is fetching these days. Let’s take Boticelli’s masterpiece that just fetched 45 million dollars at Sotheby’s.
Here is some food for thought if you’re thinking about expanding your investment portfolio. Why exactly do we think art might be the perfect or most precious commodity you could every possibly invest in because of its appreciation potential.
WHY ART IS SUCH A GREAT INVESTMENT
Why is art so valuable? Why do some see it’s value while others do not?
Why is art considered such a great investment?
Art has always been considered a luxury item. While for some multi-millionaires lacing your walls with fine art may just be par for the course, it’s designated as must have commodities for the upper echelon of society.
I recall as a nanny many years ago in Orinda, California the stairway of my kid’s home wound down and around through a long corridor and even more elongated hallways with steep white walls cascading the sides adorned with fine art – A Chagall, Monet and even a real Picasso. In the art world for true connosuers of art, Chagall and Monet are neck and neck with the Picasso.
I had been studying art at the time and was captivated each and every time I walked those halls.
Even briskly brushing my hands across the pieces to get a little feel of the actual paint that Picasso had used and feeling the edges of the canvas for a split nano-second to mesh my own energy with Chagall by having the privilege to touch the very cavas that Chagall turned into a masterpiece.
The irony of this is even then I knew the value of the art that encased the walls of the long piercing hallway, but in time that art would appreciate 20 fold, more than any piece of real estate the world over.
So – that original 6 X 9 oil canvas by the hand of Monet that I would pass by with great enthrall each and every time – at the time was worth approximately a few hundred thousand today could easily be auctioned off at of course Sotheby’s or some lesser known luxury auction house for 50 million dollars or more.
The irony of art of the past is that in most cases it was kept and treasured and not sold. It’s how the wealthy showboat their net worth.
But now a new day is dawning with younger more savvy investors who don’t showboat the art, but buy it and hide it away as a prized possession with the precise notion of allowing it to do it’s thing over a span of five or ten years with the clear intent of selling it for 10 or 20 times its original purchase price.
IS FINE ART REALLY A LOST ART
While many snooty art dealers and collectors would thumb their noses up at the works of more contemporary artists of the day, art is after all subjective. While abstract art by a lesser known artist will fetch a much smaller sum, the value of it may be just as great if not much more-so than a classic renaissance piece because of the clientele it attracts. Artists of today are not having to wait a century for the art to be worth or garner 7 or 8 figures.
There is a millionaire around every corner willing to stoke the flames of fandom and buy the abstract lesser known artists’ work.
The amount of wealth that is circulating is so astounding that a hardly known artist today might be able to garner an abstract oil on canvas or potentially even acrylic into a million dollar work of art on site at completion.
So this gives you perspective. We can then assume that if a lesser known artist who sells a piece or two for a million bucks today will have a little more name recognition in a decade or two instantaneously upping the value of his or her art. So a piece today for a million dollars could easy go for 20 million in ten or twenty years.
History does have an enormous tendency to repeat itself. There is no reason one art work would not appreciate at the same rate as other art. Again it’s subjective so there really are no rules when it comes to art.
This is part of what I love about art. It’s intrinsic value is irrelevant. There are not rules. No hard line to follow. What might be stunningly captivating with enormous value to one collector or art dealer could be repulsive to the next, but irrespective of the differences in opinion the monetary value is there.
SOME OF THE MOST EXPENSIVE ART EVER SOLD
Now these prices are adjusted prices meaning perhaps the work was listed at one astronomical price, but overbidding upped the ante by several million.
The numbers speak for themselves.
- $168 million | Artist – Pierre-Auguste Renoir | Work – Bal du moulin de la Galette
- $177.5 million | Artist – Vincent Van Gogh | Work – Portrait of Dr. Gachet
- $185.3 million | Artist – Gustav Klimt | Work – Adele Bloch-Bauer
- $507.4 million | Artist – Leonardo da Vinci | Work – Salvator Mundi