Why investing in art in 2023
Financial analysts consider art to be a stable investment market. Even with the economic downturn, the world of art continues to thrive. And that’s not only because of the fact that owning art provides us social and economical status besides the beauty of itself but because it gives a place a unique feel. know the question.. would you invest in art?
Here are 10 reasons to buy art as an investment in 2023.
1. Like any other form of investment, the objective that buyers seek in this case is to generate greater wealth. Art is a refuge value, it never loses value and is an instrument of diversification, if it is bought well it always appreciates.
2. Despite lingering uncertainties over the full impact of the COVID-19 pandemic, and within a context of ongoing political and economic concerns, the international cross-border trade in art has recovered strongly.
3. Global imports of art and antiques increased by 41% in 2021 and exports were up 38%, with double-digit increases continuing in 2022 compared to the same period in 2021. If growth continues at the same pace in the first half of 2023, cross-border trade could reach record levels in the major markets for art.
4. Most of the high net worth (HNW) collectors surveyed (78%) were optimistic about the global art market’s performance. 55% is planning to buy art over the next 12 months, and 39% hope to sell works from their collections. The pandemic also appears to have encouraged philanthropic giving among some collectors, with 45% intending to donate works to a museum over the next 12 months, up from 29% in 2022.
5. Collectors worldwide spending in 2022 showed strong confidence in the market and significant purchasing intent. Across all markets, the median expenditure of art collectors in the first half of 2022 (at $180,000) was higher than the entire year in 2021 ($164,000) and the average in pre-pandemic 2019 ($100,000).
Plans for the remainder of the year indicated intentions to spend even more, which could push the total median expenditure for 2023 to more than double the level of 2022.
6. Contrary to the bearish external market for NFTs in the first half of 2022, art collectors showed sustained interest in this sector, with digital art accounting for 17% of their total expenditure, including 10% linked to an NFT.
Spending on art-based NFTs rose from USD $35,000 in 2019 to USD $44,000 in 2021, and in the first six months of 2022 had already reached USD $46,000, with 12% of the collectors surveyed having spent more than USD $1 million in this segment. It is expected that in 2023 collectors will acquire twice as many as in 2022.
7. The last few years have seen an increased focus by art collectors and businesses in the art market on the sustainability of the movement of art around the world, while the pandemic also sparked a greater reassessment of the impact of the event-driven market.
The art trade is more sustainable by nature than many other industries, focusing on the exchange of durable works, with the bulk of the trade in secondary markets.
8. In the art market, as in many other financial and consumer industries, the increasingly global nature of trade has intensified over the last 40 years, dramatically changing the composition and geographical diversity of buyers, sellers, and offerings.
The number of countries importing and exporting art has expanded significantly, increasing aggregate sales and helping the market avoid protracted recessions due to greater geographical diversification. Greater wealth in more diverse regions has helped to boost imports of art, while factors including cross-cultural communication and the rise of digital channels for sales have encouraged a broader export market.
9. Artistic pieces are a particular asset to diversify the investment portfolio. Buying the work of an emerging artist is comparable to investing in stocks. In the art market, we talk about returns, risk profiles and asset valuation, like any other investment vehicle. Despite being considered a luxury or privileged segment, it has performed positively, especially from the perspective of auctions and collectors.
10. The utility or profitability of an investment in art is not only financial, but also in terms of pleasure, and this dimension should always be taken into account when investing. It is important that the investor buys well, but it is equally important that he likes what he buys.
The art market as an investment alternative.
Buying art is an operation that is not complex and, on the contrary, has several facilities, from its storage and transportation to the costs after the purchase transaction, since they are not tied to taxes.
In addition, they are generally understood as long-term investments (years), the time during which the work is kept until it has a significant appreciation.
These negotiations can be carried out mainly in two markets: the primary, in which the transaction is made between the buyer and the artist or the gallery, and the secondary, which is where the auction houses and other businesses that are part of the market operate and they differ because there is an intermediary in the purchase.
The profitability of investing in art rises many times to double digits. Citibank’s artistic advisory area ensures that the art market grew by 13.7% globally between 2000 and the beginning of 2019. A remarkable figure considering that in between there were several years of financial crisis.
Uniqueness is the factor that makes a work more valuable over the years and increases its value in the eyes of investors. This asset is often used to diversify portfolios and obtain extra profit.
Eclectarte can help you acquire that work of art that you like, and with which you can diversify your investment portfolio. To do so, we have three sales channels:
The first one is by contemporary artists, established as Fernando Botero, Lita Cabellut, Jamue Plensa, Nadin Ospina, among others, and whose work you can see at this link.
The second one is through private sales. On this channel, we offer masterpieces. They are high-value works of art, which are only offered through viewings with a letter of intent to purchase and belong to the secondary market or Blue Chip segment.
Here you will find works by artists such as Andy Warhol, Claude Monet, Edvard Munch, Gerhard Richter, Jean – Michel Basquiat, Mark Rothko, Pablo Picasso, among others that you can see at this link.
The third one is through the sale of artists’ books. These books are unique, limited edition. They are copies made by hand by master craftsmen in collaboration with world-renowned artists, who have a certificate signed by the artist and a notarial deed that guarantees that the book is a work of art in itself.
You will find artists like Fernando Botero, Miquel Barceló, Frida Kahlo, Lita Cabellut, among others and that you can find at this link.
