Contemporary art investment is enjoying an uplift

03 October 2017|investment |James Nicholls

Contemporary art investment is enjoying an uplift1 - Contemporary art investment is enjoying an uplift

Contemporary art investment is witnessing “a new era of prosperity” driven by rising prices. This is according to Artprice, the world’s biggest art market index art market. Recent records set at auction are thought to illustrate “a profound change in market attitudes,” but what does this trend mean for today’s budding art investors?

Historical and contemporary art investment levels out

“The new era of prosperity that the art market has entered is, for the first time in history, driven by contemporary art,” Artprice claims in its half-year report. “Collectors are now perfectly willing to pay equivalent sums for contemporary and historical masterpieces alike.”

This is good news for the contemporary art investment market, which has been climbing from strength to strength in recent years.

Untitled (1982) by Jean-Michel Basquiat made a record $110.5m (£85m) at auction earlier this year, almost doubling the piece’s estimate of $60m and breaking more than one record in the art investment market. It became the first artwork created since 1980 to sell for more than $100m, making Basquiat the sixth most expensive artist in history and equating his value with the likes of Picasso.

However, Basquiat’s landmark sale marks a broader trend, according to Artprice. Overall, demand for contemporary art has increased fivefold since 2000, transforming this segment from the weakest part of the art market to the primary driver.

Living artists offer fascinating insight

Basquiat’s reputation in the art world has been growing steadily since his death in 1988. However, many rising contemporary stars are still alive and producing work, introducing another new key trend. Rising prices for work by living artists has helped to drive a 5.3% increase across the whole market.

Artprice cites “an undeniable indicator of art market confidence in living artists,” perhaps due to the growing role of social media in the art scene. Successful contemporary artists can attract global audiences with action-packed Instagram accounts and exciting collaborations.

This represents a key benefit for the contemporary art investment market. Living artists can interact with their admirers and collectors online at the click of a button. Regardless of where they are based, what events they are attending or how their work is produced, everything can be documented and shared in order to develop interest and demand.

For instance, Bradley Theodore has worked with brands such as Rolls-Royce, Google and Moleskine, as well as events such as the US Open. He also documents his journey through exhibition launches, jet set travelling and fashion week parties.

As a result, the contemporary art investment world has never been so interesting or so accessible to collectors. Emerging artists also have more opportunities that ever before to command attention and make a name for themselves.

The contemporary art investment market moves at a faster pace

“This new dynamic is a result of a gradual transformation of the art market,” Artprice founder Thierry Ehrmann told AFP. “Contemporary art has become an economic marker… which is expected to grow exponentially.”

In contrast to this, Ehrmann suggests that buyers are increasingly being “confronted with a rarity of older art.”

There is still a healthy demand for works by the old masters, and significant works tend to perform well when they come onto the market. However, these masterpieces rarely surface, as private owners often hold onto them. This means that the market moves slowly, making it difficult for investors to build a collection.

On top of this, these older works are primarily by established artists, whose value is relatively stable. Meanwhile, talented contemporary artists are hosting incredible exhibitions, introducing new works to the market which may have the potential to explode in value in the future.

Enter the contemporary art investment world with Maddox Gallery

Whether you are looking to start your collection, or you are already investing in art, Maddox Gallery can introduce you to rising contemporary names and discuss your acquisition strategy with you further. Our Sotheby’s-trained art consultants are on hand across our London galleries, and would be delighted to talk with you further.

If you want to learn more about investing in contemporary art, take a look at ‘The Six Key Factors to Consider When Making an Art Investment.’ To find out more about any of our represented artists, please contact Maddox Gallery. Our Sotheby’s-trained art consultants will be happy to provide expert advice.

Written by James Nicholls, Chairman, Maddox Gallery.

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