To invest in Art or Not that is the question

Recently the word investment has been a bit of a dirty word. The stock market and real estate have gone from being a sure thing to an incredibly risky proposition. So what about art? Is it a safer area to invest?

As with any type of investments it is always good to have a diverse portfolio this goes for art as well. Over the long run fine art can be a great investment, that said buying art is long term investment. Over the past 10 years auction prices have been rising as has the celebrity of many artists. Even as the stock market began to tumble this fall Damien Hirst, a rock star artists if there ever was one, managed to sell over 200 artworks at Sotheby’s for nearly $200 million.

Since that auction buyers have become more cautious, at the recent Impressionists and Modern Art auction at Sotheby’s only 45 of the 70 lots up for auction sold. With shrinking returns on other investments art buyers are becoming more cautious. This is understandable with news stories telling us how everyone is cutting back, but if you can afford to do so now is the time to buy art.

With the sudden market panic, prices on art will begin to creep down, many works of high quality will be coming to auction as companies begin liquidating their corporate art collections. In addition investors who need extra cash will also be selling leading to a great opportunity for collectors. But what if your interested in investing in art but don’t have a Monet budget what can you do?

Look at art galleries, many galleries handle a variety of artist at various stages in their careers, younger artist or artists who are from countries that are becoming global player are a great area to look into. If you are looking at this from an investment standpoint start by visiting galleries; a gallery with a smart staff will be able to point you in the direction you want to go. Contemporary Indian Art is an area that has been growing steadily over the past 10 years both in India and in the West. Many of the older and mid-career artist are commanding prices that rival their western contemporaries. But the younger artist are creating high quality work that is proving to be a good area to invest.

If you decide you do want to invest in art, learn a bit about your poetical investment. Don’t just buy what you love – educate yourself first. Visit museums and galleries. Look for work by any artist studying with artist who you are interested in and who hasn’t “hit” yet. Also look beyond paintings on canvas, drawings, watercolors, and fine-art prints tend to be undervalued, so you might just get a real deal on one of those.

And in the end if the market falls out of the art world too you still have more than you did when you invested in stocks, after all who decorates with stock certificates?