Art Collecting: For Profit and Pleasure

Have you ever considered collecting art for investment purposes? If you are at home or in your office take a quick look around. Chances are that you have some sort of art hanging on your walls. You or some else selected it because you need something to put on your walls and you liked the how it looks. In some cases the price may have been a consideration. Since you will buying art, why not select works that have investment potential?

When it comes to collecting art most people feel inadequate or intimidated. We have been led to believe that you require specialized knowledge to be an art collector. The critics and most experts don’t offer any help either. Some are more interested in selling their particular showings rather than educating you how to become an art lover and a long term collector.

Collecting art can be very profitable and enjoyable. It is one of the few areas where you can have your proverbial cake and eat it too. Anyone can become a successful art collector. All it takes is to learn a few ground rules, most of which are common sense. Since you have read this far you have demonstrated that you possess common sense, now all you need to learn is a few basic rules.

However, before I get into the basics one point needs to be clarified. I am not writing about collecting the works of masters such as Dali, Monet, Van Gogh etc. For this type of collecting you do indeed need specialized knowledge that comes from years of study. Most of these works have proven their investment quality and serve as motivation for us to find the next great masters. And there will be new masters! The only question is which ones.

That’s where the fun in art collecting is! You just may be the one of the few who started buying the early works of an artist who suddenly becomes famous. It is possible! Imagine for a moment having purchased some early works of an unknown artist named Picasso. Early in his career his works were affordable and easily available to anyone. Now, look where the prices for originals have gone to – some sell for millions. And since we have already established that you will be buying art anyway, why not buy art as an investment?
Who knows, in 5, 10 or 20 years the artist may be the next Dali.

Collecting art for investment purposes is much like treasure hunting. You have to dig through a lot of dirt to get a few gems, but they do exist. Collecting art is very affordable. Remember we only want to buy works of the yet undiscovered. There is a lot to choose from so be discriminate.

In order for you to build a collection, a valuable collection, lets go over a few basic rules. I call them basic because it is enough to get you started with confidence. Once you begin you will be able add to your knowledge from your own experiences. The great part about treasure hunting is that there is always something new to discover. So never stop learning!

Now to the basics…

Collecting Art for Profit and Pleasure

1.Have a fixed budget allocated for collecting. Know how much you are willing to spend on an acquisition and how often acquisitions will be made. This is the first step because it will keep you focused. If you are starting out with only a few hundred dollars it doesn’t make any sense looking at works in the thousands. Remember you are just starting out, stay focused.
2.Buy art that you like! Since you are collecting for pleasure as much as for profit you have to like the work. Never mind what anyone tells you about the investment potential, it’s going on your wall and you have to like it!
3.Step 2 doesn’t always work and there is a good chance that you may miss out on some extraordinary artists. Art is subjective and what one person considers as art others may think its junk. To avoid this, for every 3 pieces you purchase that you like, buy one that you particularly don’t like, yet it fits your criteria as a possible investment grade collectible.
4.BUY ONLY ORIGINALS! Originals are one of a kind. Once an artist becomes well known there will be many collectors bidding but only one original will be available.
5.Limited Edition Prints are glorified POSTERS. In most cases the framing is worth more than the print. Serious collectors should avoid prints of any kind, even the prints of well known famous artists. In all probability the prices have been inflated. They should not be purchased or considered for investment purposes. For now don’t waste your time.
6.Get a biography of the artist. Get as much documented information about the artist as possible. Most artists will provide you with information about themselves, where they studied and where their works have been shown. THIS IS A MUST, and it should be accompanied with the art. If they don’t have a biography or basic information about themselves go to another artist. Move on!
7.Talk to the seller of the art. Try to verify that the work is an original and not a copy of an original. There are many talented artists who are able to duplicate the works of well known painters. The obvious copies you will be able to identify yourself (such as an oil of the Mona Lisa), others are more difficult. Ask questions and purchase only when you are satisfied with the answers.
8.YOU DON’T HAVE TO PAY THE ASKING PRICE! This is the fun part. Bargain, haggle and try to get it below the asking price. Prices are not set in stone. You just may be able to get it 50% or more below the asking price. You never know, some artists are truly starving artists. There is always room for negotiation.
9.Keep your receipts, cancelled checks and any other written information that accompanies the purchase. This is often overlooked yet it is a key part of serious collecting, regardless of the value of the piece. It is a good idea to write down where you purchased the art and the reasons why chose that particular piece. These records become part of the history of the art. Keep them in a safe place, I cannot stress enough how important this is for future valuation.
10.Take care of your collection. Keep the art out of direct sunlight, damp places and out of reach from unruly children and pets. Use common sense. Have proper insurance on valuable pieces and frequently update your records on various artists you are collecting.

Now you have the ten basic tools of collecting art for profit and pleasure. The Internet is a phenomenal resource. All kinds of information is available at the click of the mouse. It is also a good tool to share and promote your newly discovered artist. Keep in mind that the reason artists are famous is that they are well known. The more people you tell about the works you acquired the more will get to know the artist. Don’t be shy, share your discovery with others. Everyone will benefit.

Finally, don’t procrastinate, go out and start collecting. There is only one way I know of to become an experienced collector and that is to start as a novice. Everyone has to start somewhere. Don’t get discouraged. It’s true that everyone is a critic, but the only critic that matters is YOU!