Investing: The New Art Form

Published 10 years ago
Investing: The New Art Form

Art can pull you in deeply. Expressive and raw, it can be believably real, and not. Just like life, it has a fascination; it shows us that it goes on all the time, in straight lines, or abstract.

For all our over-civilized attitudes toward art, our relationship with it is still primal. We are consumed by its emotional involvement with us, constantly wanting to understand its intuitive physical movement in all that stillness, captured on canvas, paper or stone. No wonder it is known as an ‘investment of passion’.

But art is turning out to be more than an unthinking love affair with the aesthetic. It is a tangible investment, and the numbers do not lie. In 2011, the European Fine Art Foundation estimated the global art market was worth $60 billion, a six-fold increase over the past two decades. In 2012, sales at Christie’s auction house were more than $10 billion, up 10% from 2011. And the Citadel Art Price Index, which looks specifically at the South African art industry finished 2012 on a high, at 12.2%.


True, in the past, art was considered a high-end collectable, available only to extremely wealthy individuals. But thanks to the emerging market, trends are finally changing and art acquisition is far more transparent, less guarded and opaque.

Like most investments, buying art requires thought and consideration – it is not only about what is pleasing to the eye. FORBES WOMAN AFRICA spoke to the CEO of Business and Arts South Africa, Michelle Constant, to get a clearer understanding of what you need to get started.

“Let’s face it. Investing in art is a dual investment – both emotional and

financial. Once you invest, you’re stuck with the work as a long-term investment. So first and foremost you must love it. It’s an incredible relationship, owning but also loving the piece of work you’ve bought,” Constant says.




Art is not that much of an enigma. Sometimes it is best to keep it simple. According to Constant, it is useful to visit “galleries, auctions and art fairs, they are good places to get a feel for art and the type of artwork you might want to buy”.

It is also about being informed; you have to learn how the market operates. Sometimes it is best to take at least a year to wrap your head around the ins and outs of the creative space of the industry, before you set out to choose your first artwork. Most importantly, you need to understand your aesthetic, Constant advises. What kind of art do you like? Do you lean more toward painting, sculpture or print, to name just a few?

“Read art magazines and websites (The SA Artist Magazine or to find out about openings,” she explains. If you are inte-rested in learning the basics or the history of art by studying a formal course, there are several on offer in South Africa. A good place to start is probably the online directory: “A great book to read, which will give you wonderful insight, is Seven Days in the Art World by Sarah Thornton,” Constant suggests.


Once you have a feel for what you want to buy, engage.

“Go to galleries, auctions, talk to curators and collectors, the market’s expert consultants, so that when you buy your first piece, you are competent in the subject matter.” Try to attend the annual FNB Joburg Art Fair in South Africa, or the Affordable Art Fairs, which take place in America, Asia, Europe and the UK.



“When it’s time to buy, buy according to what you love, because the return on investment is not guaranteed. What is guaranteed is that you’re going to have to wait at least 10 years, so you really should love it,” Constant advises.


“Remember, once you’ve bought your first work you need to grow your knowledge and become informed in your participation. The more you know, the more you like or don’t like, the more astute you will be in your buying.”



You are looking for the kind of company that can offer a range of services – from helping you choose your art, to helping you avoid buying fakes, or stolen goods. Remember that even with all the advice that comes your way, there is no guarantee that you will make queenly profits on any work that you acquire.It is best to book an appointment with auction houses.

Some of the most well known in South Africa are:


Stephan Welz & Co. ( Strauss & Co. (

Artinsure ( Russell Kaplan Auctioneers  (



Consortiums, an art fund, or as a lone buyer? “As far as I know, there are no real art funds active in South Africa, so you would have to invest in one primarily in the UK or North Ame-rica. The problem with art funds is that they’re set up like private equity funds… but that doesn’t align with the 10-year plan. Their track record is apparently not that brilliant, in general. There are successful consortiums in South Africa. It’s a bit like a ‘stokvel’ (rotating credit unions) and it also provides excellent opportunity for emerging buyers. Importantly, though, all the individuals in the consortium must have the same long-term view.


“For me, lone ownership has been the best way to go. It has meant I can go out and buy smaller works and build my collection. It’s a much more personal process and ties into the concept of a dual investment – emotional and financial,” Constant says.



“If you buy from a gallery they will be sharing 40 to 50 percent of the sales price. The work then takes a long time to sell at that or a higher price in the secondary market (auctions, etc). In essence, you need to account for dealer costs, maintenance costs – such as archival and framing – insurance and security. This is why you need at least 10 years. In that time your artist is also building his or her brand, thus growing the value.”

Keep in mind that your artwork must remain in perfect condition. Many experts will advise you to rent proper storage facilities. South Africa is not known for major natural disasters such as earthquakes, tornados or floods, but if your pieces are stored under suitable conditions, they will not deteriorate.

For those storing art at home and on the wall, specialist insurance is key. Barrington Insurance Brokers in Johannesburg is a good place to start:



“A common argument is that for contemporary art you hold on for 10 to 12 years, whilst with modernist art  (a Pierneef or an Irma Stern) it’s around five to seven years. My personal opinion? If you love the work you hold on forever.”