Start An Art Collection Realistically And On Any Budget

Andy Warhol, Marilyn Monroe, art, 1960s

Photo: Flickr / oddsock

Looking for somewhere “safe” to put your money?Well, there isn’t one; however, some investors rank art second to only property as the best place to put your money.

The art industry is truly a world of its own where the stakes can be high and access limited. With the right knowledge, tips and guidance you can find the right artwork to invest in and can do so on any budget.

We are all equipped with the ability to watch stock prices and this knowledge can be supplemented in various ways through public and private resources. Art, however, is different.  To understand the art market, you’re staring down the task of learning thousands of years of product history, a relatively illiquid marketplace and the fact that prevailing tastes play a major role.

Art collecting for investment itself takes patience and dedication so the first, second and third rules of art collecting is that you must have an interest in art. Once you’ve established this, then there are some basic guidelines to begin your collection.

1. Decide what you like and develop a niche
Investing in art takes a bit more “hands on” investigation than most investment opportunities.  Start by going to museums and galleries just to get a sense of the breadth available to you and to decide what you like. By visiting museums you get the history and you can use the masters to get a sense of the styles that turn you on, which you can use to choose pieces that are closer to your price range. Visit galleries to find out what is going on today and pick up materials on artists you like.

2. Create a budget
You can invest on many levels of the art market, so make your budget realistic to you. What can you realistically spend on artwork in one year, two years or five years? Keep in mind there may be added costs to consider (taxes, framing, shipping, insurance, care for the artwork).

3. Art Investment is Not for “flippers”.
Based on how much you decide to invest, figure out how much you can afford to have tied up for a while. Art is not a market for “flippers”; it’s decidedly “buy and hold” for the foreseeable future.

4. Make sure your goal and your budget match up.
If your goal is to own all of Monet’s Water Lily paintings by 2020 and your budget is $5,000, you have a problem.

5. Where to go after all of the above.
Auction houses and art funds are going to be at the highest pricing end of art buying and will require the most independent knowledge on your part (or the funds to hire a consultant) so it is wise not to start there until you feel more comfortable. Think more about exploring art fairs to see what galleries are putting forth as their “best work” and see how that resonates with your collecting tastes and budget. This will also give you more of an idea of pricing of works as many artists work will be shown at multiple fairs.

More importantly spend time when visiting galleries and art fairs building relationships with the staff, primarily the director. Buying and selling of art is based on relationships. This can simply be done by asking questions and expressing a genuine interest in the work and specific artists. Many galleries also offer benefits and special previews to new and established collectors as well as putting you in direct contact with the artists they work with through talks or studio visits. Galleries are more interested in working with individuals who have a long term interest in the work as opposed to someone just looking for a piece that fits “above the couch”.

6. Questions to ask.
You’ve settled on an artwork or maybe just an artist you really like so now is the time to learn more. Make sure you ask about what I like to call the “Three P’s”: Pedigree, Press and Personal. Where did this artist go to school? What is his or her background? What kind of collections or press is the artist included in? What is the artist like?

Then you want to ask questions about the artwork itself: Provenance, Proof, Damage. Did anyone own the work before? Is it signed and where? Has it ever been damaged and repaired?

These tips will get you on your way to buying your first works of art. From there, you will want to look long term in growing your collection.

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