It’s more fun to own a beautiful painting or sculpture than a stock certificate. Works by famous artists can sell for seven, eight, and even nine-figure prices, and while few can play in that rarefied world, some studies show that art performs pretty well over time as an asset.
So it’s tempting, and arguably pretty smart, to diversify your portfolio with a little fine art. But as New Orleans-based art appraiser, consultant and broker Amanda Winstead tells Business Report in a feature from the current issue, there’s one foremost rule to keep in mind: Only buy what you love.
“It has to be something that brings you great joy,” she says.
Art valuation is not an exact science, and the art market is fickle. Even if you do your research and receive professional advice, that expensive painting in your collection may not sell for as much as you had hoped. So if you’re not going to enjoy owning it, it’s probably not worth buying.
Mark Biletnikoff, a Baton Rouge artist and art patron who plans to open a gallery in March, says this area doesn’t have a big high-end art market, although a few local galleries have clients willing to drop $10,000 on what they hope is a sound investment.
The average Baton Rouge buyer is hesitant to spend more than $500 on a piece, Biletnikoff says, and most buy primarily because they like the work, not because they think it’s a smart investment. Some are willing to go up to $1,500 for something they hope will increase in value, but that’s usually a check-with-the-spouse-first transaction, he says.
“Do your homework,” Biletnikoff says, when asked for advice about investing in work by an emerging artist.
Biletnikoff recommends betting on a serious artist, not a part-timer, with a documented sales history who you believe will keep creating good work. An artist with an established secondary market provides a more liquid investment, Winstead says.
Biletnikoff warns that an astronomical return on work by an emerging artist is very unlikely, although it’s always possible. The art world is a little like Hollywood, where the superstars make up a tiny percentage of the working actor population.
So how much of a return can be expected from art investments? That’s a complicated question without a simple answer.
Read the full feature. Send your comments to editors@businessreport.com.
