We’ve all seen the headlines of a Picasso selling for $115 million or a shredded Banksy being worth far in excess of the £1.04 million the owner paid for it before it was destroyed. But these stories catch our attention because they are the outliers.
The reality of art investment can be a different story. Can money be made by simply buying and shifting a painting within the space of a year? According to the experts, art is similar to any investment in that you need to know what you’re doing. If a get rich quick scheme is what you’re after, look elsewhere.
"People who go in it just for investment don't choose well and they buy for investment reasons and it's not really a good idea," explains Imelda Collins, joint owner, with Loretto Meagher, of the Trinity Gallery on Dublin's Clare Street.
“There’s no guarantee that everything you buy will go up in value. But, as was proven by the Celtic Tiger, people who had shares just tore up their share certificates, while people who had paintings had tangible things to sell,” she adds.
With bank deposits fast becoming a near pointless endeavour on the back of record low interest rates, investors are scoping out alternative ways to ensure their money doesn’t devalue at the very least. And while the very best art, which represents a lesser risk than gambles on upcoming artists with no track record, can be as good as a savings account, there appears to be no guarantee that a painting’s value will skyrocket.
“If your motivation is investment go and buy gold bars or currency,” says John de Vere White, the managing director of de Vere’s art auctioneers in Dublin. “Anyone who goes in with that yardstick always comes a cropper”.
De Vere White, who has almost 50 years’ experience in the business, suggests, however, that while people solely in it for the investment are unlikely to walk away with vast swathes of cash, they’re equally unlikely to lose a significant pot of money. Nevertheless, he recalls the Celtic Tiger and while art was the last thing to fall, it has also been the last thing to rise.
Post-bust values
Some of the state’s most prominent artists have yet to see the value of their work rise to the level seen before the economic crash - even if, as de Vere White says, prices achieved before 2008 were “unsustainable”.
“Will it ever get back to the way it was before? Probably not, but that’s not a bad thing either,” adds Collins.
In any event, the prices tell their own story. De Vere White instances a Louis le Brocquy painting, “Woman” he recently sold for €40,000; back in “the heyday” it sold at auction for about €150,000. Another recent auction saw a Jack Butler Yeats painting, “Tralee”, sell for €180,000. It was previously put on the market in London for €250,000, although it didn’t sell at that time.
Le Brocquy, de Vere White adds, has been “devastated” in the current market, with values “way down”.
But all this talk of money rather misses the point, the experts argue.
Passion investment
“A lot of dividends you’ll receive from art is the visibility, and being able to own it and have it in your possession,” says Morgan O’Driscoll, an art auctioneer with salesroom in Skibbereen, Co Cork, and Dublin.
Hanging quality paintings on your wall, in effect, is the reward for buying art that you enjoy. And, it needn’t cost the earth.
As de Vere White notes, his auction house sells pictures by quality artists for five, six, seven, eight-hundred euro.
“It’s a complete myth that quality art needs to cost money,” he says.
So what do the experts advise if one is to set down a path of curating their own private gallery?
“Research, research, research,” O’Driscoll says. “I would say a good rule of thumb is to find a few artists that you enjoy”.
“We’d encourage people to look around and go to all the galleries. That’s where art is talked about,” Collins suggests, noting that once someone starts buying, “it’s like a disease” - although in a good way”.
Holding value
And while finding a painting is an imprecise art, if you’ll excuse the pun, the experts agree on a selection of prominent names that hold their value.
Meagher suggests artists including Mark O’Neill, Kenneth Webb, Arthur Maderson, Markey Robinson, Martin Mooney, Elizabeth Brophy, Matt Grogan, Graham Knuttel and Nora Van den Berg.
O’Driscoll’s list includes Jack Butler Yeats, Paul Henry, Sir John Lavery, Tony O’Malley and Dan O’Neill, an artist he believes is “undervalued in the present market”.
And what about the up and coming stars?
“Ignore people you’re told who are up and coming potential stars,” de Vere White proffers. “Somebody who people are yapping about could have given up painting in five years time. The people to buy are people who’ve been at their trade for 30 or 40 years and if they’re hit by a bus tomorrow they’ll be leaving a body of work behind them to keep their names up in lights.”
That’s not to say buyers shouldn’t look to artists they enjoy just because they’re not ultra-famous. But he suggests that chasing up-and-coming stars for the sake of it can be a pointless endeavour.
With buyers coming in all shapes and sizes, particular where their wallets are concerned, the professionals agree that art is available on all budgets.
“There’s a lot of art selling from €100 to €1,000 and it’s very important for those people to get into the art market,”
O’Driscoll says, adding that spending €300 on a painting is a “good investment if you appreciate it”.
De Vere White agrees: “You’ve got to be interested and train your eye. If you’re prepared to get interested and you have a few bob and you take advice from the right people I would have thought putting money into art now is safe as a house.”
And it doesn’t have to be something you rush into.
“When somebody comes in and asks advice we’d encourage them not to buy straight away. We’d invite people to take it home and live with it for a weekend,” Meagher says.
And lest prospective buyers believe the experts are advising off buying paintings as an investment, they’re not.
“A new sofa will devalue to zero while if you buy a painting, there’s an investment value on that. You can get your money back and get a return on it,” O’Driscoll advises.
According to de Vere White, while it’s a tricky and sometimes fickle market, he’s not trying to suggest it’s “doom and gloom”, but merely that buyers should beware.
“The majority of people who come into the gallery will buy because they’re interested in buying an original piece of art, and once they start, they just love it.
And although there aren’t tax breaks for the individual buyer, those with paintings in public places like hotels can get some relief. But, if the advice is to be followed, buying art is not to be viewed as a conventional investment.
In any event, conventional investments are rarely enjoyable, but simply a transaction with an end goal in mind. They’re a vehicle to see steady and solid returns be that through low bond yields or flat pension fund returns - hardly a thrill.
For art, it sounds as if success is measured in enjoyment and truth be told, that doesn’t sound like much of a hardship.
And, as de Vere White notes, “there is certainly serious value out there”.
