According to an annual summary called the Wealth Report by real estate consultancy Knight Frank, buying fine art is not a smart choice if you expect a quick return on your investment. In what they call the "Knight Frank Luxury Investment Index," art shows a 3% decline in value over a 12-month period, increases by 2% in five years, and skyrockets to 193% in a decade. The only investments with higher returns after ten years are coins, stamps, and luxury cars, and the only category that shows a continuous decline is furniture, but we suspect that they mean basic couches and chairs from IKEA or Walmart.
The study really isn't that surprising when you think about it. Most art sold via auction or private sales is thought to be overpriced initially. Collectors don't typically buy pieces to flip them two months later like a pair of sneakers. It is definitely a game of patience, not a get-rich-quick scheme.
[via ArtNet]
