This story is part an online community dedicated to financial empowerment and advice, led by CNET Editor at Large and So Money podcast host Farnoosh Torabi.
Investing in art can seem out of reach – a business that requires a small fortune or a VIP invitation to an exclusive auction house. However, as the art market has shifted online, especially via social media, it has become much easier to connect with talented artists and invest in original pieces on a tighter budget.
Farnoosh Torabi, editor of CNET and So Money Podcast host, interviewed Liz Lidgett, owner of the Liz Lidgett Gallery, on how to spot interesting art investments and build a meaningful collection. Whether you just want to start your first collection or eventually turn a profit, read on for tips for new art investors.
Determine what you like
Before you begin, you’ll want to determine your taste. Imagine works of art on your walls that you would like to live with. Art can make your home more enjoyable and transform not only a room, but also your mood. Brain scans have shown that looking at a work of art can increase blood flow to the brain by up to 10% – the equivalent of looking at someone you love.
To find out what you like, Lidgett suggests taking a partner or friend to a museum. “Imagine having an unlimited budget and taking something home at the end of the day,” Lidgett said. “It starts this conversation of ‘Why should I bring this home?’ or ‘What draws me here?’ You look at the work in a different way.This is the first step in determining what you like.
Think about your budget
Lidgett suggests setting aside what you can afford each month — whether it’s $10 or $100 — so that by the end of the year, you can collect at least one piece of art. “The process,” she said, “doesn’t have to be fast and furious. You can take your time, but keep an eye out for an artist.” So when something becomes available, you’ll have an art investment fund to draw from.
Look for limited edition prints
Many well-known or even emerging artists may be out of your price range. A great, cost-effective way to get pieces from more expensive artists is to track limited-edition prints, especially looking for lower-number editions. In the art world, a limited edition is exactly what it sounds like: there are only a number of prints available. Thus, prints are less common and tend to retain or increase in value. Lidgett advises keeping your budget to $150 or less.
However, Torabi said that for some artists and editions there may be exceptions. Torabi described a piece she bought last year in a flash sale for $3,000 up 900% based on current prices on art resale sites. This was from a limited run of prints signed by British artist Damien Hirst.
“Hirst’s original hand-painted pieces typically cost five to six figures, so I jumped at the chance to own one of his limited-edition signed prints for much less,” Torabi explained. “Honestly, however, I have no intention of selling. My philosophy for alternative investments – like any investment – is buy and keep. I hope to keep him in my family for generations.”