Investing in art, whether it is Renaissance paintings or contemporary African art, is always a wise decision. You can start your collection from an early age or build it up once you are more financially stable. It might sound like a tricky financial decision to make, but you can invest in art no matter how old you are. Below are some tips on how to do so if you are considering investing in art.
Find out about the types of art
There are many different types of art to choose from, and it is important to find out about the different ones before you make a decision on what to invest in. Novices tend to only think about paintings but art can include photography, sculptures, sketches and even multimedia pieces.
You should also learn about the different art styles, including contemporary art such as Surrealism and Expressionism and more traditional styles such as Italian Renaissance art and Impressionism. Finding out about the different types of art will allow you to ascertain which one appeals to you the most and thus you will be able to choose which art to invest in.
Learn about your local art scene
Once you have done research on what the different types of art are out there in the world, you will need to learn about your local art scene in order to find a gallery, museum or exhibit to purchase from. Find out which galleries exhibit modern art, which ones show more antiquated art and which ones work with emerging artists so you can find one to suit your needs.
In terms of the cost of art from these galleries, you will find that more established artists are on the higher end, while emerging artists are more affordable. You should attend gallery openings for new galleries or exhibition openings for artists, as you will often find that these are the days when art collectors tend to buy their share of the art. Ask these seasoned buyers for advice on what style and era is en vogue so that you can make the right decision.
Choose an artist or artists
Once you have learned about your local art scene and have discovered some of the galleries, you will need to choose an artist or artists that you enjoy. This can be difficult, as you might like two artists that use vastly different styles and methods to create their work.
While collecting, you will need to choose what you love and what you feel is right for you. If you enjoy work by artists such as Osborne Macharia or Laolu Senbanjo then choose a piece from each artist. Deciding on one or two artists will make it easier for you to choose a piece of art, and it is important to do research on his or her background, such as exhibition history and professional resume. This will tell you about the success of your investment.
Consider the costs
Before you dive in to buy that artwork that catches your eye whenever you see it, you will need to consider the costs of investing in art. Ideally, if you are planning on adding to your collection on a regular basis, you should be looking at spending at least R20 000 per year in order to build up a private collection over time.
Investing in art is not like other investments, because it takes time to find the right pieces and having knowledge about the artwork and artists is of paramount importance. You need to factor in additional costs such as commissions and insurance. Usually, the commission from an art auction house is between 10 to 20 percent and can increase to up to 50 percent if you buy from a gallery.
Think about the future
Once you have chosen a work of art, you will need to consider what you want to do with it later in life, such as passing it on to your children when you die or donating it to a gallery in your old age.
If you decide to pass the artwork down to your children or family, then you will need to bear in mind that you do not have to pay capital gains tax (CGT) on the sale of this art, provided they have been purchased for personal use. This means that, should you leave your art to your children when you die, they will be able to sell it without having to pay CGT. The choice of location to hang your art in your home can affect the value, as if you hang it above a fireplace, it could cause the paint to dry and fall off, and if you place it in an area that has too much sunlight, the painting will become sun damaged and lose its value.