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From Art to Investment

fine art investmentFlipping open newspapers about half a year ago and you would see many people get rich by resale of property. A profit margin of some million dollars in one single deal was not uncommon. Higher return often needs higher cost. But with skyrocketing flat prices in recent years, most investors find it increasingly difficult to buy low and sell high. Some of them are moving their assets away from real estate to a more interesting art market.

Hong Kong’s fine art market is one of the most thrilling in the world. Lots of art auctions take place in the city due to its free trade policy, as free flow of capital and antiques and no tax on auction items significantly prop up local art market. Thousands and thousands of art aficionados and investors with high purchase power are drawn to these auctions each year.

Hong Kong also has a massive portfolio of finest art items. In the mid twentieth century, high quality art works, ranging from Chinese calligraphy and paintings to poems, antiques and artifacts, were transporting from the mainland to the city under the background of the Chinese Cultural Revolution.

art investment

On the other hand, the rising of fine art market in mainland China recently has also benefited that of Hong Kong. “The Chinese art market is the largest and fastest growing in the world. Artists are moving away from political works and the market is much more established now. We are seeing Chinese artists breaking auction records overseas”, says Jon Reade, managing director of Art Futures Group.

“The average portfolio that we manage is HK$2 to HK$3 million, with average pieces of art around HK$200,000 to HK$400,000 by classic, mid career artists, and investors hold the pieces for five to seven years. Last year, we saw double digit growth, averaging between 10 to 15 percent,” adds Reade.

Other than investment potential, each piece of art treasure holds great historical values. Once you learn to appreciate the aesthetic appeal and core value of art, you will understand why it is so unique and precious.