Art as an Investment
In the past year investing in art has seen a boom with sales of Scottish art being particularly strong.
In 2013, Auction houses such as ‘McTears’ and ‘Lyon & Turnbull’ reported a strong year with Lyon and Turnbull experiencing a turnover in excess of £10 million despite a slow start to the year. McTears, being one of the most popular auction houses in Scotland said that sales of Scottish art were particularly strong but by the end of 2013 it was contemporary art that generated the most sales, with the auction house selling over 5000 contemporary art paintings.
Sales of scottish art in 2013 saw that collections such as the Colourists, the Glasgow boys and antique furniture being most popular showing that investment in art is as high as ever despite economical struggles.
Art is of course bought to bring long term pleasure and love but over the years it has seen to have great benefits as an investment. In 2002 a painting by Peter Doig was bought for £314,650 but then in February 2013 it was sold for £7.7 million. Indeed, this illustrates that buying the right painting can have considerable returns.
A recent study by Kyle Sommer at JP Morgan found that art prices have risen independently from more usual investments such as bonds and property funds in the past 25 years.
Art has shown positive returns over the long-term in the past few years. The global art market is growing, with the latest figures from the European Fine Art Foundation suggesting it amounted to €46.1bn in 2011, taking into account public auctions and estimated private sales.
As a result, art as investment is increasingly accepted in both the artistic and financial worlds. Financial advisers focus on art as a source of long-term profit. New hedge-fund-like vehicles, so-called art funds, buy and sell artworks and share the profits.