Art, as an alternative investment class, is one of the fastest growing asset classes in the category.
Any luxury item which holds its value reasonably well over time is considered a collectible, said Bongani Khulu, the head of Family Office and Client Engagement at Absa.
“The majority of art collectors buy art to add to their collections, but with an investment view.”
According to the 2018 South Africa Wealth Report, South African fine art prices have risen by 28percent over the past 10 years (in US dollar terms), while global fine art prices have risen by 12percent. “The art market has shown an ability to thrive through economic and political uncertainty. It is not about flipping artwork every year, it is a long-term investment that is meant to be enjoyed,” said Khulu.
According to New World Wealth, the number of high-net-worth individuals in South Africa rose by 8percent during 2017, reaching 43600 by the end of last year. But not all art investors belong to this small group of wealthy individuals, said Dr Paul Bayliss, Absa Art and Museum Curator, who collects and manages the Absa gallery and provides a platform for nurturing young artists.
Bayliss is responsible for managing Absa’s art collection, comprising about 18000 works. “You don’t need a lot of money to get into investing in art; you can buy an artwork for a couple of thousand rand. There is value for everyone,” said Bayliss, adding that potential investors should look at an artwork “in the same way you consider a stock on JSE”.
“Examine the artists’ credentials, their technique, whether they are developing or stagnant in their work. An artist could be technically strong but you should understand their narrative. I most enjoy visiting an artist in their studio because it gives one insight to the artist’s world.”
But, he cautioned, if you are buying art, don’t merely buy due to the possibility of making money. “Purchasing art is a lifestyle investment. Sure, old South African masters like Irma Stern or Jacobus Hendrik Pierneef fall within a bracket and guarantee a return on investment. But with younger artists don’t buy because you’re hoping to make money in five years; buy because a piece resonates with you.”
This year’s Absa Champagne Festival boasts an exhibition for young and upcoming talent, some of whom have been named as artists to watch, such as Pauline Gutter, Banele Khoza and Jan Tshikhuthula, and sculptor Roberto Vaccaro.
Other works are by artists including Jaco van Schalkwyk, Benon Lutaaya, Nelson Makamo, Vincent da Silva, Anton Smit, Pat Sithole and Asanda Kupa. The Absa Champagne Festival starts at the Inanda Club in Joburg today and is scheduled to run until November 2.