So hows the art market holding up in all this turmoil? Well, I read some reports a couple of months ago which seemed to be suggesting the art market was doing fine. Actually it stated that the market was up! How can this be? I thought...so i did some research, and this is what i found.
Are people still buying artwork?
Yes. More people are buying artwork than ever before. BUT specifically they are buying artwork from unknown or junior artists and they are sometimes called. The kind of thing that costs between £50-5000. They are also buying established classics too, which fetch a much higher sum. This is where the serious investors are. But even the amateur can pick something up for a modest sum from an unknown artist and get something tangible which is likely only to go up in value over the next few years.
There seem to be several reasons why.
- Investors over the last decade have focused on getting a return on their investment. They still want that in today's situation, but more importantly they don't want to loose their investment. If you take a look at the stock market you can see its just going down all the time, and is extremely risky. If a company looses value they loose some of their investment, but worse, if the company collapses altogether then they loose everything. As a result investors want to put their money in less risky, more tangible assets. Some are putting their money in gold bullion, and other such assets, and interestingly in artwork!
- People are having a hard time and this brings about strange behaviour. An example, did you know that the pregnancy rate has shot up? Its unexpected, you would have though people have less money, but people are looking more at entertainment and trying to give themselves a pick up. People are buying artwork to help cheer themselves up!
- Discounts -artists are discounting their work, they need to make a living too. Its the same as Marks and Spencers doing a 20% sale today, out of the blue. The price of goods is coming down and this includes artwork too. Which is good for buyers, looking for a bargain!
Its hard to be sure, who knows how bad the impact of the credit crunch will get, but what is clear is that people are buying artwork at the moment. My feeling is that the sale of artwork will continue unabated.
Lets look back in a year and see what happened.
Thanks for reading. I hope you enjoyed it.
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