How to Invest in Art - A Beautiful Long-Term Investment

Buying art is a great way to support artists and put a unique stamp on your home’s interior decor. But it can be so much more. It can be an investment that adds to your net worth and provides actual value to your estate for you and generations to come.
However, buying art can also sometimes be a little intimidating, especially for novice collectors. Even for art collectors on a budget, there are plenty of places to find and invest in art.

Where to buy art

There are plenty of different venues to find art for purchase. Of course, most people make a purchase based on what they like. For others purchasing art as an investment, the choice includes finding art that will grow in value. Here's where to begin.

Art galleries

Art galleries are one of the traditional venues where art collectors peruse and purchase new art. Whether you travel to art-centric towns bursting with galleries, like New York or Santa Fe, or just head down to a local gallery in your hometown, galleries always have new work on display available for purchase.

Art fairs

Local artists and creators often display their works at art fairs for purchase. Art fairs and art markets can range from small, local art fairs featuring emerging artists to prestigious and world-renowned art fairs like Art Basel Miami, the Armory Show, and FIAC.

Art auctions

Art auctions are another place where art collectors can purchase fine art. If you’re inexperienced with art auctions, you may want to work with an art advisor or art buyer who will help you navigate the process in exchange for a fee.
That said, art auction houses are often reserved for higher-ticket items coveted by experienced collectors. However, there is more affordable art to bid on, particularly at the end of the night. You can also participate in online auctions run by organizations like Sotheby's.

Student shows

If you want to get in on the ground floor of the careers of the best young artists at affordable price points, student art shows are one of the best ways to do so. Art schools typically host student shows at the end of the semester. There's plenty of great art to choose from at famous art MFA programs. This is the equivalent of penny stock investing in something you believe will grow.

Online

It is possible to find high-quality, original artworks for sale by both emerging and established artists all over the internet, from limited edition prints to masterworks of modern art and everything in between. Some places to look for art online include:
  • Etsy
  • Society6
  • RedBubble
  • Saatchi Art
  • Zatista
  • Artspace
  • Artsy
There is also digital art available online that is considered a non-fungible token (NFT). This new medium made recent headlines when Christie's auctioned two pieces of Beeple works."2020 Everydays" sold for $3.5 million in December 2020 and "Everdays: The First 5000 Days" sold for nearly $70 million in February 2021. Of course, there is plenty of digital pieces available at affordable prices that could add to your investment portfolio.

Directly from artists

Perhaps the most apparent means of buying art is to purchase it directly from an artist. Whether you know them in real life or follow their career from afar, you may want to get in touch with them to see if you can purchase their art directly. Some artists also sell art to customers now on platforms like Etsy, Instagram, and on their websites.

What to consider when purchasing art

Purchasing art is figuring out what works of art speak to you, but there is a little more to consider when it comes to purchasing art as an investment. Because of this, personal preference and artistic sensibility play a considerable role when picking out pieces of art—but practical considerations also play a role. Here are a few things to consider when selecting your next work of art.

Your budget

First and foremost, you should look for art that fits your budget. There’s no one-size-fits-all approach to budgeting for art; for some collectors, art purchases make up a sizable portion of their disposable income, while others want to be able to decorate their living room without breaking the bank.
Before you go shopping for art, it’s a good idea to be realistic about your budget and how much you can afford. Also, keep in mind that the price range for works of art can be flexible—in some cases, you may be able to secure a small discount on work if it’s slightly out of budget.

The artist

Of course, the person has created the work is very important. Sure, you know an Andy Warhol piece is a blue-chip investment but understand the art world and determining the value of emerging artists is essential. Look to artists who have the support (and even funding) by renowned musuems and art galleries. Look for reviews of the artist in art magazines and with collectors. Consider an artist like a company and the piece is like stock. Research the artist as you would a company before you invest.

Limited editions

If purchasing works that are replicated, such as prints or photography, artists will create several editions. How many are made will affect the value. If an artist only provides 50 pieces, documented and signed, versus 1,000 pieces, the limited editions will have a higher value.

Where to store your collection

While some want to buy a few pieces and display them in their homes, maintaining art is crucial to value. It must be kept from moisture and anything that could damage the piece. Remember, art appreciates, and it could take decades before it receives considerable value. How you preserve it for those decades is essential.

Platforms offering fractional art investing

Another way to purchase high-valued art available at auction is through new online platforms. Members can own a fraction of a high-priced piece of work, such as a Picasso, in what is similar to fractional investing in high-value stocks.

Masterworks

The first platform created to help investors get into art investing, Masterworks allows unaccredited buyers to buy into works with shares starting as low as $20. However, it does require a minimum $1,000 investment. Providing ample research on artists and the pieces, this is a worthy brokerage and trading platform that is excellent for new investors. Remember, the company holds its investments for at least 5 years, so you'll need to keep your money invested for the longer term.

Otis

Similarly, Otis provides art investments and NFTs, and collectibles like trading cards and comic books. Available for accredited and non-accredited investors, Otis allows you to view, purchase, trade, and store your collections on its mobile app and does not have a minimum investment to join.

Yieldstreet

Yieldstreet is a trading platform for investing alternatives. This includes art as well as real estate investments. Members can start with as little as $500 with some products requiring a minimum of $15,000. It offers both long-term and short-term investment opportunities for passive income.

Pros and cons of investing in art

Pros
  • Can be high-value
  • Value doesn't depend on the market
  • Investment can be enjoyed and displayed
Cons
  • Can be expensive
  • Can be challenging to understand the art world
  • As a long-term investment, it is not liquid
  • No guarantee of increased value

The bottom line

Buying art is a great way to put your unique stamp on your home’s furnishings while also building your net worth by investing in pieces that will hang on your walls for years to come.

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