December 9, 2020, at 5:30 pm Kathryn Widing, Specialist of Post-War and Contemporary Art with Christie’s Auction House will be providing you with the answers. During this eye-popping webinar, Ms. Widing will guide you through the process of selecting artwork that will not only inspire you during your Zoom calls but also act as a solid investment to complement the investment that is your home. To RSVP click here.
The event defining 2020 – COVID-19 – has reshaped what we value and where we want to invest. Suits gave way to leisurewear and trips to Europe were eschewed in favour of installing a pool or remodelling the kitchen, office and backyard. Given the central role that our homes played in fighting the pandemic, housing became Canada’s favourite topic and, for the most part, best investment. However, there’s something in your home that may be more valuable than you expect, and just as resilient as your home during an economic downturn – art.
When exploring how art performs during recessions, I was shocked. During times of international chaos and conflict, art out-performed stocks. Take, for example, the latest massive economic collapse in 2009. Just following the implosion of Lehman Brothers, Christie’s Auction House set records selling Yves Saint Laurent’s collect totalling $483.8 million. While auction sales generally fell in 2009 from their peak in 2007, by 2011 sales volume had completely rebounded. The S&P 500, on the other hand, took two more years than the art realm to reach pre-crisis trading levels. To be sure, art prices like homes are volatile during wars and recessions and various styles of art perform differently, however, they still tend to be good long-term investments. Generally, art appreciated 7.7% over the 1875-2000 period, outpacing inflation by 4.9% and beating S&P 500s real return of 6.6%. Thus, art, as does a home, brings both pleasure and appreciation for collectors.
Purchasing art, like a home, requires trust. This is especially true during the pandemic as we were all required to “tour” homes and see art virtually when making our decisions to buy. A trusted expert became increasingly important during the pandemic as it’s difficult to tell if the art is authentic, made well and suits your tastes if you’re only able to see it in a picture. Given the complexities that COVID-19 had on processes of buying art, will collectors stop buying art? Or spend only on artists whose works are easily defensible against fraud? If the latter is true, will prices boom for some artists and bust for others? If so, which ones?