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The Value of Art Investment During a Recession
While the economy might be in a bit of a recession, the art market continues to boom. No matter how bad times get, art is a universal language that speaks to everyone in some way and brings them joy.
And not only is art a pleasure to look at, but it’s also something that people find meaning in. When we look at art, we can both find ourselves and lose ourselves. It can help anchor us to reality, or it can offer us an escape — which is likely why people continue to buy art, even during periods of recession.
This is also what makes art such a great investment, especially when the economy is experiencing a bit of a downturn. Buying art now, when money is potentially tight, can help you turn a profit later when the market is back up.
However, keep in mind that though art investment is generally good for your portfolio, the art market can be fickle. There is no guarantee that the pieces you buy will offer a return on investment. Yes, art does tend to appreciate in value over time, but it can also depend on the piece. What you find to be a worthy piece of art might not be appreciated by others the same way when it comes time to cash in on your investment.
This article will look at the benefits of investing in art, the different types of art you can invest in, and how to ensure you are purchasing worthy assets that will offer you a large return down the road.
Art matters for so many reasons beyond being a good investment. It’s a pleasure to look at, it makes you think, it’s a conversation starter, and it can also elevate whatever space it exists in — be it your home, an office, or even a public space.
From a cultural or community standpoint, buying art can support local communities and local artists, it can enrich and improve people’s lives, help spread cultural awareness, lend itself to historic memory, and preserve cultural beliefs and practices.
From a business perspective, investing in art can create an influential experience and environment for visitors and employees, which can improve a company’s overall image and improve employee and visitor satisfaction. A business that buys local art can help put money back into their local community, which can also improve their reputation as a brand.
Of course, financially, investing in art has numerous benefits as well. First and foremost, art is yet another way to diversify your investment portfolio, which is crucial to building a strong portfolio that is more likely to offer greater returns in the future. Beyond that, art is an ideal investment because it is a global market, has low volatility, requires minimal or low-cost maintenance, grows tax-free, and for the most part, it has a proven track record of appreciation.
Different Types of Art to Invest In
The world is full of all kinds of art for people to buy and enjoy, though not all art is necessarily the right fit when it comes to building an investment portfolio. When you are considering buying art for investment purposes, you’ll need to do your research before simply throwing your money at whatever pieces strike your fancy. Any type of investment requires a bit of effort and thought to ensure it makes sense and will yield the returns you are looking for. For tips on visit Art Protection.
Below are some of the best kinds of art you can invest in today.
Fine art has remained one of the most popular forms of art investment for years now. However, when you walk into a gallery or an auction, there are some things to keep in mind. Original works are always going to be worth the most and are where you should keep your focus because the rarity of a piece is what gives it value. Giclées, or print reproductions, should generally be avoided as they are copies of original works and are thus not worth as much value.
NFTs, or non-fungible tokens, are a more recent trend in the art world and have been steadily becoming popular as a form of art investment. NFTs are units of data or digital representations of a good, such as a work of art, and these tokens are inimitable and can never be interchanged. This means they are unique and can become quite valuable, making them a good investment option.
Furniture as Art
Decorating your home with nice furniture isn’t just about aesthetics; it’s now becoming a popular investment trend. While furniture as art is nothing new and has been around for years, it’s recently become popular again as people seek ways to get more and more creative with their interior design while also investing in pieces that make for good assets. And down the road, the art in your home can help you fetch a higher price should you decide to sell your home, in addition to the return on investment for the pieces themselves.
There is no one right way to start investing in art, but it does require some thought and research. Like any investment, you want to make sure you are making the right decisions. So taking the time to work through a thorough decision-making process can really help.
From there, use these tips to get you started investing in art:
- Seek out emerging artists. Investing in known art or older art pieces is a good idea, but it’s also wise to seek out newer artists that are up-and-coming in the art world. If you get in on their work before they are well known, it can offer a significant return on investment when they hit it big.
- Focus on a style or theme. When investing in art, it’s a good idea to stick with one category or style of art. The more you research and buy pieces that fit that category, the more experienced you will become at having an eye for worthy pieces that will offer a larger return on investment.
- Don’t go all in at once. Even if you have the money to do so, you should take your time investing in art and start small. You want to be smart with your purchases and taking more time to do your research and shop around gives you more time to gauge the market.
- Be fair with offers and firm when selling. When you want to buy a piece, make an offer that is fair and give it time. If the piece is going for higher than what you think is reasonable, just move on. When selling, however, it’s better to be more firm on your pricing to ensure you get a good return, but always be willing to negotiate if it feels right.
All in all, art is a fine investment. Generally, the slew of benefits outweigh most cons, and there aren’t that many cons to begin with. The biggest concern is to be mindful of the pieces you purchase because not everything will appreciate in value. On average, however, most good art does appreciate and is easy to manage as part of your investment portfolio.
Editor Note: To help with browsing our own website, we have written Emerging and Notable Artists to Collect and Buy Art From to guide you toward some of the options available that we feel have the best opportunity to increase in value.
About the Writer
Miles Oliver is a growing writer working to expand his portfolio. He has learned a lot about creative best practices as a freelancer and hopes to write pieces that may be helpful to others in similar fields!