What should collectors look for when purchasing art for personal and investment reasons?

Replies to This Discussion

Permalink Reply by J.T. Smith on October 16, 2011 at 10:33pm

If you love the art that you collect, then it matters not if it devalues or appreciates with time. I dont acquire art as an investment, I collect because I cant live without having that piece. Some artists that were really hot, that the expects and authorities raved about have fallen out of favor. Later generations saw nothing special in them, they were removed off museum walls. The Van Goghs that every expert and authority in world at the time would tell a collector not to touch later became priceless. That is the story of art. The experts and authorities have been proven wrong time and again.

The art that the Metropolitan Museum of NY and its arsenal of experts thought was garbage, became the conerstone of American art- the Abstract Expressionists. It is not because Peggy Guggenheim was wealthy. It is because when it comes to art, it is hard to tell. Taste changes, and it can be erratic.

The price of art is what collectors are prepared to pay for it. The market determines what it is. A piece priced at one gallery for $5,000. could be priced at Gagosian for $50,000. It is who is selling and who is buying. It i, it is not the intrinsinct value of the work, itis the collectors and dealers at work.

That is why I buy what I like and have no intention of reselling but passing it on to my grandkids or donate them to a museum. If my pieces appreciate, great, if not, I shall not trade the spiritual satisfaction I had owning the pieces for all the gold in the world.

Permalink Reply by House of Art on October 16, 2011 at 11:33pm

It also comes down to who has or institution has a vested interests in the work.  True Van Gogh was ridiculed and not taken seriously as an artist during his time.  But he is a very rare example, you have a better chance of winning L0tto. We can also not overlook the fact that wealthy people are preserving their wealth through art and they get behind certain artists that they control the market for their artwork. 

If you go back and research the galleries (Leo Castelli, Sidney Janis to name a few) that represented de Kooning, Pollock, Twombly, Rauschenberg etc. they all had relationships with the curators from the Met and Moma (wealth and power goes a long way).  These works of art were priced accordingly and each of these artists had gallery representation.  An eighteen-foot Pollock sold for $8,000. in 1952.  Twenty years later it sold for $35o,000.  This is not by coincidence it's strong representation by galleries promoting the artist and not saturating their market.  People bought the art because they trusted the gallery owners who so passionately believed and invested in this group of artists.  There were plenty of other talented artists that you don't even know exist from that same period. Why is that? So trust me there's a formula in place the success is not by coincidence.  Reputable galleries help to establish an artist market, manage an artists career and promote them, museums are there to validate the work of these artists.  Galleries also protect the investment of collectors. 

I question that Gagosian would be selling a work of art for $50,000. while another gallery is offering the same piece for $5,000. Gagosian tends to purchase entire collections from his artists and also requires exclusivity before taking on an artist.  Gagosian also stands behind  the work he sells to the point where he has be known to actually buy work back from auctions at substantially higher prices to protect the market value. You don't sell 800 million dollars worth of art in a year without protecting your assets.  Bottom line Gagosian is a business man first.  Research his operation he runs it like an investment firm.

I buy art for historic, personal and monetary investment.  My children will appreciate the legacy I leave, but they will also be able to take a painting off the wall and sell if necessary. 

Permalink Reply by J.T. Smith on October 17, 2011 at 10:07am

Yes, it is about the power and influence of branded galleries, branded collectors and branded museums working together. There are very few galleries that have such power and influence. I have seen so many galleries go out of business in the last twenty. Most galleries dont even have the staying power to make any difference.  I think the lifespan of most NY galleries is about 5 years.  My point about Gagosian is that a painting that a regular gallery might have a problem selling at $5,000 could be be priced and sold at $50,000 by a branded gallery like Gagosian because of the brand name. Just because Gagsian or Saatchi is selling it, is approval of value.

 

It takes  a lot of financial power and influence in the art world to put an artist on the top. It is one one the reasons why almost every black artist who has attained any level of recognition has gotten there because of white galleries.  Our black galleries just do not have the money and power.

 

The art world is still very fickle, though. Despite all the power and money of the establishment,  the Impressionist that the experts poohpoohed became the new artistic force. All the art that the French Academy and the Establishment approved became less valuable.  Bougeaureau and other artists like him, who were the most celebrated artists of the time became  minor artists. Their value plummeted drastically.  Many hot NY artists of the 70s that the experts were counting on, whose works were selling for six figues, have vanished off the radar today.

 

Sometimes new money and changes in economic conditions change the value of art. With the new found wealth in China and India, the prices of their artists have sky-rocketed. contemporary Chinese art is very hot today.

 

I hope my collection appreciates to a level that would let my grand kids reap some financial reward from it, when I am gone. However, art history teaches me that I have to be cautiously optimistic. I would pay $20,000. for a piece if it speaks to me.  If I have the money, I would buy Tanner's Banjo Lesson in a heartbit if it appears on the market. I just saw a piece, The Game by NY artist Tafa, in Grand Rapids-Michigan, it was prized in six figures and I can' t afford it, but if I could I would have grabbed it without blinking.

I guess I am just passionate when it comes to art. I would donate some of my collection to a museum so others can enjoy it. I believe I am just a custodian for now. Eventually, it has to go to the people. It came through the artsit to me, but it belongs to all humanity. For those who buy for investment, that is ok. For me , it is a spiritual journey, it is a way to touch the finger of God.

Permalink Reply by Turtel Onli on November 17, 2011 at 6:11am

Insuring, appraising, presentation, production values, cataloguing, documenting and publishing collections are important to add value to ones collection. Often restoration is needed.  As with a collection of vintage cars, furs or real estate.  It takes pampering and maintaining.

I have Rhythmistic artworks in a few institutional collections as well as private ones. Art, like cars or furs,  can and should include merits of quality based on design aspects, quality of materials, artistic expertise, historic impact, the artist's pedigree along with how it motivates the collector.

 

Does a rare confirmed mint condition Lamborgini, Benz or Cartier item only have value if it comes from a certain type of dealer?

Is a diamond bought or sold outside of the DeBeers' cartel less of a diamond?

Be bold and research your art and artists.  The information is out here.

Grow a criterion based on standards of evaluation related to the artwork itself.  The artist,  Art history & movements. Cultural or social history. Consider the differences that may occur between personal taste and intrinsic value.

Maybe take a class in Art Appreciation.

 

Consider your collection on par with your financial portfolio.

 

Get your art own any way your can.

Permalink Reply by Joyce Owens on November 17, 2011 at 7:28am

Good points! I think many respondents, Turtel, Coni and the art dealers have made great points. I agree with the diluting issue.  I work very hard to maintain a large inventory, primarily because as an artist I make art and love to!  The problem is, even as a university curator, I have to monitor artists who insist on discounting their work behind my back, when it is priced low enough.  I try hard to make sure artists get an honorarium when they exhibit so they know their work is valued.  But, even so, the urge to sell, at any cost,  for some artists is irresistible.

 

Picasso and artists who showed promise in the early 20th C. often received stipends and their work was purchased in bulk by art dealers.  If an artist is broke they do what they can. Annie Lee has been selling cheap reproductions of her art for years but see where it got her? Into the Cosby collection and others. I sell work in "reputable" galleries, some of whom immediately offer interested clients a discount. I witnessed one collector turning down the offer because he said my work was worth the full price. He also owns Kara Walker's etc. The serious collectors may take a nominal 10% because they are frequent buyers, but the gallery should AT LEAST split the difference with the artist. Most will take it from the artists fee, after not paying them anything for having the inventory to sell.

 

I think everyone needs to cooperate. You have no gallery without the artists. Artist can make and sell art without the gallery, though, I for one, appreciate the gallery system. I wrote about that on my blog.

 

I believe in galleries, but they sometimes disappoint.  www.joyceowens.com

 

One article on Chicago artists that includes publication of my work with Tony Tasset and a couple others. The other a reproduction of my painting on a poetry text...

Attachments:

• Chicago Gallery News NancearticleSept11.pdf, 3.9 MB
• Dream Big painting Our Difficult Sunlight cover.jpg, 1.1 MB

Permalink Reply by Cleveland Dean on January 12, 2012 at 8:00pm

Speaking on a few bullet points.

It was mentioned that Pollock sold an 8ft painting in 1952 for $8,000. That was $8,000 in 1952. Equate that to todays money. Then equate the $350,000 in todays money or based on the same curb what the difference would be 20 years from now. For a modern day artist to command $3,000 for a work if they have done due diligence is nothing. I  have just joined this site today and a common thread seems many think that an artist work is supposed to only be a few hundred $'s when many collectors I have or have come to know wont even consider work under 4 figures because from an investment POV it is not worth holding on to for a duration of time to show/create an ROI. I understand the train of thought that some artist have their first show at a cafe and want to throw outrageous, unearned prices on their work but this is not always the case. Which brings me to my next point.

If an artist is not currently in a gallery doesn't mean they weren't once in a gallery. As stated in a post earlier, post 2008 many galleries have folded. How does this devalue the artist they had in their roster? There can be a bevy of reasons an artist has not become part of another gallery. Speaking personally, I have turned down a few galleries because I felt it was not time, not the right gallery or for whatever reason I may have. That doent make my $5,000 or $25,000 worth any less. The artist should not have to justify their prices, the collector should have done their research to find out why this particular artist is valued as such. Personally, if a collector asked me to justify my prices I would immediately kick them out of my studio. This has the aire of them collecting work is as if they are doing the artist a favor. Not needed, there are many individuals that will respect the work and the artist whereupon the artist doesnt have to accept such arrogance.

Regarding the bullet point of an artist that is everywhere...as an artist you almost always have to be everywhere before you are only here or there. And by the time that artist is only here or there...their work is going to be way more than $3,000 if that isnt the starting point. I do believe that artist that partake in "zapp"ish art fairs are not an investment. Take the gallery/museum/major art fair route and not the flea market approach in being a collector from an investment stance or an artist that wants to have their work taken seriously in the art world/market.

Dont pass the buck. If you are a collector and you have a strong belief in an artist work and can afford the artist, it can be assumed that you have a like circle of influence. Guarantee your own investment and spread the word of this artist. It is not only the job of the gallery and the artist to make you money. Just as the artist has done what they can regarding promotion to garnish attention to add value to the work, and the gallery has done the same the collector has the power to join this team. Just as it is stated about the artist and the gallery protecting your investment, protect your own investment, speak on it and get others on board.

Work that doesnt have to be worked will start in the mid 5 figures, START in the mid 5 figures. Their are several tiers:$1-1000; 1001-5000; 5001-20,000; 20,001 - 250,000; 250,001+. If an investor is looking to make a relatively quick ROI they best to be shopping in the latter 3, and have close ties to an educated secondary market and auction houses. If not you may have to wait several years if not decades and have the insight to collect this particular artist. Of course there are exceptions.

I think that there is a lack of understanding of the current art market and current artist here. Speaking on works that have been re-appropriated over the course of the past 60 years is one thing, but as stated these are works where if you are not ready to drop 5,6,7,8 figures you dont even get an invite. If it is to be spoken on the here and now...a couple hundred dollars aint going to cut it.

Permalink Reply by Colin Quashie on January 12, 2012 at 8:51pm

YES! YES! YES!

Permalink Reply by Cleveland Dean on January 21, 2012 at 7:33pm

Thank you Colin

Permalink Reply by Turtel Onli on January 22, 2012 at 9:26am

The BAIA brand should enter soon as a factor in collecting. But to the theme stated here there is a serious set of political practices that are used to censor, limit and over emphasize "selected" artists from 'restricted artists" in galleries, museums and anthologies. To this point the collectors in this era  as the fantastic opportunity to collect outside the "box" that is the gallery system.  To apply value and worthiness based on a new and growing set of standards of value and appreciation. To experience the joy of discovery and empowerment.

There is a tremendous amount of opportunity here on all sides.

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