On a positive note

(By Nalini S Malaviya)

The art market is hit hard and there is no getting away from it at the moment. But, all this talk about the recession can be quite depressing and I sincerely hope that this phase gets over as soon as possible.
While people are still buying art that is affordable, sales of mid and high end segments are highly affected. Buyers are now treading cautiously, and rightly so. Recently at the preview of an art exhibition one of the artists mentioned how thankful he was that he had not resigned from his day job. However, when the same artist said that he had slowed down the pace of his work as the demand was considerably less, it was reassuring. In my opinion some of the best works will emerge in the current phase. The furious frenzy to produce more works during the boom period will now be replaced by a more spaced output. Artists will have more breathing space and time to follow their creative instincts rather than follow popular demands. This is a good time for them to be experimental, dabble with different media, and come out with smaller works and maybe even an affordable line of works.

Collectors should take stock of their collections and think of getting it catalogued if it is sufficiently large and mark out the works which they would like to sell off. One should also consider insuring the more expensive or rare artworks. Unfortunately, insurance of art is still not a very popular trend in India, and very few companies are offering this. But, one could look around to find a policy that suits ones needs.
For buyers this is a good time to pick up quality works at competitive prices. Those who don’t know much about art but happen to be reading this could use the opportunity to get familiar with the art world. Those of you, who are looking at buying art at this point, should begin with a small budget. This is also a good time to network with people from the art fraternity and to attend art shows and other events. In short be positive and use the time constructively.

(Published in Bangalore Mirror)

Sell art only if you have to

(By Nalini S Malaviya)

As everyone knows this is not a good time to sell art, as prices for paintings and other art forms have fallen significantly. Therefore, if one were to sell now, one would not get the same price as what could have been achieved a few months ago. According to some reports art prices have corrected as much as 30%. However, need for liquidity may encourage investors to sell a few select pieces. In such a scenario, it is important that the seller be realistic about his expectations. Still, if an investor had purchased a work of art 5 or 10 years ago, selling it now will fetch good returns on it.

A seller should do a thorough research and crosscheck current rates from various sources to arrive at an optimum selling price. There have also been instances where artists have shown an interest in buying back their works. This usually happens when the work is representative of a certain phase of the artist, or if it adds value to an artist’s retrospective exhibition. In any case it worth investigating if the artist or his family is keen on regaining the work.
When planning to sell a work, one should also be prepared to wait as it could take some time before the transaction actually happens. Under normal circumstances, too, it is difficult to liquidate art in a hurry. Sellers could check around with galleries, dealers or private collectors who can either buy the work themselves or alternately source a buyer. As buyers are also on the look out for good deals, one may have to be open to negotiation.

It is easier to sell rare and good quality works, especially if they are offered at an attractive price. One should also ensure that all relevant documents – provenance, authenticity certificate and receipts if any – are in order. Before putting up an art piece for sale, remember to check the condition of the work, that it is not damaged or affected in any other way.

(Published in Financial Times)

Be cautious when making fresh investments

By Nalini S Malaviya

This year the stock market has seen major fluctuations and there are still no immediate signs of easing of the economic recession. Investors are facing a dilemma about where to invest. The financial scene appears bleak at the moment, and most predictions point towards a troubled future. Recent trends in the art market, too, have failed to inspire confidence in investors. Prices of most artists have fallen either substantially or at least marginally. Many senior artists are now opting to have an exhibition of their works without offering any piece for sale. This appears to be a strategy to try and maintain their market rates, but, how successful will it be, will become clear only over the next few months.

In such turbulent times investors should be wary of making any fresh investments in art. In case they would like to do so they should consider all aspects related to the art market dynamics – investment timeframe, risk factors and ease of liquidity. One could opt for artists who are considered safe from a financial investment angle and who have established and proven themselves over the years. Although, this forms a safe category and involves blue chip artists, the amount of initial capital is fairly high, and that can be deterrent for a lot of investors.

The other option which is appearing attractive is investing in upcoming artists. The major reason why this is catching on in a big way is that prices are low and these make for excellent wall fillers. However, one must be aware that the risk is high for this particular category. As the capital required is low, most people are open to spending a part of their disposable income on such art. In this case if one can do a certain amount of research, and back it with technical expertise in order to select quality works, it increases the chances of picking up a winner.

(Published in Financial Times)

Consolidation and stabilization phase of the art market

(By Nalini S Malaviya)

The general perception is that the overall interest in art has dwindled to such an extent that no one is buying art. While, it is true that the amount of money that is being spent on art has gone down considerably, and that many galleries and dealers are affected, one can still come across many buyers who are continuing to buy art for its intrinsic value and also for investment. The economic recession has affected most businesses; at the same time there are people who are comparatively unaffected in the present situation.

There are still a lot of people who attend art show previews and other events. Some of them even end up buying paintings that they like. The category of art that was priced between Rs.15,000 to Rs.50,000 is seeing the maximum sales. Most of these works are either decorative or done by upcoming artists and even final year students from fine art institutes. It can also be noticed that most artists are now open to negotiation as far as prices are concerned. The boom time for art is definitely over and the plateau that one sees now reflects a healthier trend in the art market. This phase is also expected to allow artists and other members of the art community some breathing space which should eventually help the market. Greater introspection, more time and space to explore creativity, focus on business ethics will help in strengthening the market in the long term. As most analysts point out, this period of adjustment will help in the consolidation and stabilization of the art market. Well, it is important to begin the year on a positive note.

Most major art events such as fairs, biennales and seminars are going as per schedule. As galleries point out, it is important to continue with their events in order to keep the interest in art alive. 2009 will be significant in establishing and charting out the course that the art market will take in the years to come.

(Published in Financial Times)

Use the time effectively

(By Nalini S Malaviya)

Due to the current economic recession, investors may find the art scene in a reduced state of activity. There are fewer art shows and events taking place, where most of the bigger exhibitions involving the top bracket of artists are being postponed. While, this is happening more with galleries based abroad but the effects can be seen in the country as well. Travel to art fairs has also been affected and galleries and artists are actively cutting down on expenses. Experts feel that the worst is yet to come and it may be a while before the art scene stabilizes.
However, all this does not mean that art connoisseurs should give up on art completely. There are many things than an investor can do to utilize the interim period effectively and to consolidate one’s collection.
Long term investors can continue to buy affordable art by young and upcoming artists. They should avoid selling wherever possible as this is a buyer’s market at the moment. By the same rule one can look out for good deals at competitive prices. A liquidity crunch can force collectors and dealers to offer attractive prices.
Investors should focus on making sure that their collection is safe and is maintained in a good condition. They could consider insuring their artworks if it hasn’t already been done. A large collection should always be catalogued and documented appropriately. It is important to maintain all documents related to the artworks as any loss of these can affect prices later on. Authenticity, provenance and sale receipts are some of the papers that one should keep safely. It is also a good idea to keep photocopies of these documents in a secure place.
If an investor needs to sell now then one should look for a buyer discretely. Incidentally, premium and rare works are continuing to fetch a good price provided one can find the right buyer.
It is important to utilize the interim period to build a network with other art connoisseurs. The art community is a fairly close knit one, and very often transactions and dealings happen through word of mouth. Recommendations and references are useful to have.
If one is making any fresh investment then research is very important at this stage. Watch out for the not so good quality works that may be available in the market.
The slowdown is likely to continue for the next couple of years, therefore it is vital that one does not let it affect one’s financial and mental health. It is a good time to review ones art collection to see which works should be kept and which ones should be sold off later.
One should continue to visit art shows and keep in touch with the latest happenings. Most galleries plan to continue with their art shows in order to keep the interest in art alive. Good deals are available now, and if one’s wallet allows, buy.

Use the time effectively

(By Nalini S Malaviya)

Due to the current economic recession, investors may find the art scene in a reduced state of activity. There are fewer art shows and events taking place, where most of the bigger exhibitions involving the top bracket of artists are being postponed. While, this is happening more with galleries based abroad but the effects can be seen in the country as well. Travel to art fairs has also been affected and galleries and artists are actively cutting down on expenses. Experts feel that the worst is yet to come and it may be a while before the art scene stabilizes.
However, all this does not mean that art connoisseurs should give up on art completely. There are many things than an investor can do to utilize the interim period effectively and to consolidate one’s collection.
Long term investors can continue to buy affordable art by young and upcoming artists. They should avoid selling wherever possible as this is a buyer’s market at the moment. By the same rule one can look out for good deals at competitive prices. A liquidity crunch can force collectors and dealers to offer attractive prices.
Investors should focus on making sure that their collection is safe and is maintained in a good condition. They could consider insuring their artworks if it hasn’t already been done. A large collection should always be catalogued and documented appropriately. It is important to maintain all documents related to the artworks as any loss of these can affect prices later on. Authenticity, provenance and sale receipts are some of the papers that one should keep safely. It is also a good idea to keep photocopies of these documents in a secure place.
If an investor needs to sell now then one should look for a buyer discretely. Incidentally, premium and rare works are continuing to fetch a good price provided one can find the right buyer.
It is important to utilize the interim period to build a network with other art connoisseurs. The art community is a fairly close knit one, and very often transactions and dealings happen through word of mouth. Recommendations and references are useful to have.
If one is making any fresh investment then research is very important at this stage. Watch out for the not so good quality works that may be available in the market.
The slowdown is likely to continue for the next couple of years, therefore it is vital that one does not let it affect one’s financial and mental health. It is a good time to review ones art collection to see which works should be kept and which ones should be sold off later.
One should continue to visit art shows and keep in touch with the latest happenings. Most galleries plan to continue with their art shows in order to keep the interest in art alive. Good deals are available now, and if one’s wallet allows, buy.

Get familiar with the art market

(By Nalini S Malaviya)

Given the market situation, investors should utilize the opportunity to learn more about art and to keep a look out for good deals that may be on offer now. Here are a few steps to help you get started.

Look at art
This may sound old fashioned in today’s technological age where many transactions take place virtually with the click of a mouse, the fact remains that nothing can replace the joy of physically standing before a beautiful painting.
Although, many art exhibitions have been postponed indefinitely, a substantial number is still being held, and one should therefore continue to visit art shows, galleries and museums to look at art and become familiar with artists and their styles. Physically looking at art is very different from seeing its image as a photograph or on the Internet. Wherever, possible one should look at original art. It will also give you clarity on what appeals to you.

Research
This is a good time to go through art history books and publications. Browse through articles, news reports, auction reports and catalogues to understand trends and price points. Read reviews to understand the artist’s work in a larger context.
Note down names of those artists who appear regularly on auction catalogues. Check their performances in the auction results and it will be a good indicator of the artist’s demand and market price (secondary market). Evaluate the artist’s career in terms of stability, growth and price trend. It helps to verify the credentials of the art gallery supporting the artist. Compare current prices with previous ones – again this is a good indicator of an artist’s potential and his market confidence.

Make a wish list
Based on your research, prepare a wish list for your portfolio. Which artists would you like to see in that list? You could also go further and make a list of the actual works that appeal to you. However, be prepared that these may not be available immediately. But, you can keep a lookout for them in forthcoming auctions or through dealers.

Art Insurance

(By Nalini S Malaviya)

Insurance of artworks is a fairly common trend abroad but remains a relatively new concept in India. However, it appears to be catching on as the number of collectors and investors has grown substantially in the last few years. In fact, now there are more companies who offer art insurance.

Why do you need to insure art? It is important to insure art against natural disasters, theft, fire or any other damage caused due to unforeseen circumstances. Museums, galleries and also private collections are now increasingly turning towards insurance coverage. Still, at the moment there are only a limited number of companies offering insurance for fine art. As premiums are high, most private collectors and investors shy away from insuring their collections. There is an urgent need for greater awareness and also friendlier policies that cater exclusively for art.

Reputed galleries ensure that their artworks are insured in transit but collectors and investors too should make sure they have an insurance cover when they lend out their works for public viewing. Else, any damage caused in transit or at the public site can cause an irrevocable loss.

It is important to document the collection appropriately through photograph, receipts, provenance certificates or any other related papers. One must go through the policy in detail to understand the fine print completely. Policies may vary according to the size of the collection, or in some cases one may want to insure only a part of it. Smaller collections or a few pieces could be covered as part of a comprehensive household insurance cover. Look around to find a policy that suits your needs.

The art collection needs to be appraised for its estimated value. Professional valuations can be done periodically to ensure it matches the market rates. Undervaluing the collection can lower the premium but in case of a loss or damage the claims will also be lower and the compensation may not be adequate.
When insuring, a significant criterion in selecting the insurance agent should be to opt for a company who has built a reputation of honouring claims.

(Published in Financial Times)

How to choose art by an upcoming artist

(Nalini S Malaviya)

Now that there is a lot of focus on upcoming artists and young talent, one sees many art exhibitions by artists who either debut with it or are in their second or third show. Most art galleries are now promoting such artists aggressively, and it then becomes difficult for the buyer to evaluate the investment potential of such artists. In any case one must remember that it is very difficult to predict the investment value of an artist who does not have a proven track record. It becomes very important, then, that the buyer consider all aspects related to the artist’s future prospects.

One must take into consideration the artist’s qualifications, awards, if any, and the technical aspects of his artistic skills. One can also look at the creative potential which will be reflected in the concept and execution. Innovation and ideation play an extremely important role in contemporary art. For instance, there are artists who come up with a brilliant concept but fail to present it effectively, and then there are times when an artist has nothing new to say. The novelty of an idea combined with effective expression is a much desired and extremely sought after quality. If the artist has held shows previously, one can check out which galleries or venues were involved.

These days what is also becoming important is the credentials of the gallery backing the artist. A good and reputed art gallery will promote their artists at national and international levels, which can affect the artist’s career and investment value enormously. However, there are many collectors and buyers who go with their gut instinct and tend to buy works they can emotionally connect to. Although, this may seem like an old fashioned approach to new buyers, but many collectors swear by it, and this method has worked extremely well for them. Experienced art collectors develop an intuitive feel for the quality and value of art which instinctively draws them towards the right work. As investing in an upcoming artist’s work can pay rich dividends in the long run, one should spend time evaluating and analysing before buying it.

(Published in Financial Times)

Investing in art

Thanks to the hype there is a lot of interest in investing in art, but for many buyers the biggest challenge lies in knowing where to begin. Although this topic has been covered extensively in the past, a few points can be reiterated to help the new class of investors.

There are some financial consultants who manage investment portfolios and who are now also diversifying into investing in art. Should you go for that option, remember to check out their credentials to ensure they are sound on all aspects related to art. Art as an asset class requires specialised knowledge, for instance information on upcoming artists, price and market trends to name just a few. In addition, a strong network with galleries, dealers and clients who are open to secondary sales is also a must. On the other hand you can opt for an art consultant who can assist you with planning out your art portfolio. Another option is to consider investing in art funds.

Having said that, the biggest thrill that comes with investing in art lies in doing your own research, reading up all available information, keeping tabs on the market, visiting art shows, interacting with artists and so on. The joy of choosing an artwork that appeals to your senses and you want to put up in your home is immeasurable. However, when you are looking at art from a purely investment perspective, be prepared to sell it when necessary. Most collectors caution and advise that one must maintain objectivity towards the artwork. Passion and emotion can cloud your judgement and you may either find yourself drawn towards art that has no investment value or you may end up keeping artworks foregoing opportunities to sell them at an advantage.

Keeping up to date on newer mediums, genres and foreign artists one can have the advantage of picking up works at lower costs that have the potential to appreciate in future. In conclusion, it helps to remember that one must always buy from reputable sources, ensure there are all relevant documents (authenticity and provenance), look for quality works and finally diversify your portfolio accordingly.

(Published in Financial Times)

Reframe if necessary

As most buyers and investors are aware about good quality framing and the importance of taking care of an artwork, there is another aspect which one needs to look at when buying art, especially framed works from any source. In any case most people take a lot of care when framing the paintings in their collection, so that is an issue well taken care of.
But, very often galleries sell works that are already framed, but this frame is usually of a very basic quality and in fact may not meet quality standards at all. The framer is generally the local carpenter and not an expert framer. However, one hopes that with repeated framing and with the gallery’s expert input he does a fairly decent job. After all, inexpensive wood, cheap backing and mat can ruin the painting, especially if is a paper work. One important factor to consider when buying art should be the condition of the artwork. Most people are able to spot scratches or small tears, but when it comes to frames, one should carefully look at how well it is done.

Recently, one came across works on paper by a very senior artist, but the paper had been glued to the backing and was also in contact with the glass front. In addition, there were creases on the paper in some of the paintings. All this can damage the painting irrevocably. When you are spending in lakhs of Rupees, it makes sense to spend a decent amount on the framing as well. If you notice particularly substandard framing, you can request that the gallery reframe it before handing it over to you. Most galleries who are of repute will be happy to oblige.
Many buyers prefer to reframe the paintings through their own trusted contacts. In fact, many of them have the gallery frames removed and opt for ornate and more expensive frames. Which makes sense because it is natural that one would want to safeguard the investment potential of the painting and ensure that it remains in mint condition for years to come.

Wait before you sell that painting

As an art collector or investor you may want to sell some of the works in your collection and buy newer works. Unfortunately, due to tremendous media hype a lot of people have begun to look at art as a short cut to wealth. In six months. That is a myth. Art should always be looked at as a long-term investment. There might be isolated cases where someone has made money by selling a work in 6 months, but these are exceptions to the rule. If one is lucky enough to find a buyer who is willing to pay more than the market price for the work you own, then that is another story. In general, it is not easy to sell art in the secondary market unless you are either a part of or have contacts with a network of consultants, dealers, buyers and investors.

Some art galleries and dealers may assure young and new investors that they can always resell the painting, but in fact selling an artwork is very different from selling gold or shares. Although, gallery offers may appear tempting, one must take the time to consider that your money will be effectively ‘locked-in’ for a certain period when you invest in art. According to a Delhi based art consultant as an investor you must be aware that you must hold the work with you for a minimum of 3 years to get decent returns. In fact, if you can wait a five-year period that is an optimum timeframe which will fetch you better returns.

Investors who have been buying art for several years will happily tell you stories about how they bought a Husain for Rs 250 many decades ago. In fact in those days art was not looked upon as an investment avenue, but some of these ‘investors’ who have held on to their Husains, Razas and Padamsees are now probably a part of the millionaire club. In any case, the point is that one should not be in a hurry to sell art. Keep a pulse on the market, which will give you an idea how prices and the demand for that particular artist is evolving, which will also help you in making the decision.

(Published in Financial Times)

Appreciate art before investing

As art finds a prominent spot in your morning newspaper, chances are that you will come across reviews and a lot of other information about art shows. As there are very few art critics in the country, most reviews and write-ups are done by journalists and freelance writers. Many people buy art based on what they read. It helps to know that media coverage about art shows depends on a lot of factors such as how prominent and well-known the artist is, in case there is a PR agency involved - how well they market it, and also to some extent the gallery’s standing. In that case should one buy art from shows that get extensive coverage across newspapers and other publications? Media hype is good to some extent and helps in establishing the artist, but of course not all good artists receive the same amount of attention.

However, there are several advantages in following updates on art, for one it keeps you abreast of happenings in the art world. It gives you an idea about trends, popularity of artists and price bands. Then again reading about art shows or their reviews gives you a better understanding of the artist’s perspective, and also the artworks. Artist interviews in particular give a glimpse of what the artist had in mind while creating the artwork, how it evolved, and the thought process behind it. Therefore, when you visit the art show, you will be in a better position to assess and evaluate the art in the right context.

Understanding the piece of art or relating to it is the first step in appreciating it. It helps to remember that the response to any art is a very personal experience, and can be extremely subjective. Therefore, you should always visit an art show with an open mind. Your response to it may be very different from the writer’s perspective. The more you learn to appreciate art, the better your judgement will be when planning your art investment.

(Published in Financial Times)

Figurative or abstract?

If you look around you will find that most Indian artists whose works are in great demand have a penchant for figurative art. Whether they paint figuratives because it is in demand or vice versa it is difficult to say. But the fact is that a larger cross-section of buyers have a liking for figurative art compared to abstracts. V S Gaitonde’s evocative abstracts and S H Raza’s geometric abstraction and the Bindu are of course exceptions to this rule. These remain greatly in demand and usually do very well at auctions. However, one must also remember that these artists have acquired cult status in Indian art.

But, in general most buyers opt for figurative art rather than abstracts or any other genre. This is especially true for new buyers who tend to relate better to ‘realism’ in art.
The general feeling regarding abstracts remains that it fails to move the viewer in the same manner as a ‘recognizable’ work of art. A viewer responds to a work of art based on his experiential background and his sensibilities, and therefore it is always easier to relate to a familiar and easily decipherable work of art rather than an abstract or non-representational one.

However, there are plenty of discerning buyers who are able to differentiate between deliberate abstraction and random or amateur brush strokes. Incidentally, most artists who are known for their abstracts have excelled in figurative art as well. While, there are a few artists, such as Anupam Sud who have shifted from abstract art to figurative.
Artist KM Adimoolam, who passed away recently was equally proficient in drawing (his series of black and white portraits of Mahatma Gandhi is very well known) and in abstracts. The play of colours on his canvas is a delight to watch.
Indian modern and contemporary art as we know it is still in its nascent stages. As the awareness about art and its finer nuances grows, one is sure to find that abstracts will become more popular.

Signature style or experimental works?

Many artists believe in sticking to one particular genre of painting, even a theme and continue to work with it over the years. They perfect their style, their command over the subject and technique. They deal with the theme in a similar manner and continue to create works that has only slight variations – as it may appear to a viewer. While this may appeal to some, others may find it boring or repetitive.

Buyers often wonder if they should buy an artist’s signature style or look at something more experimental. It could be new media, a new concept or something that is radically different. The answer is very subjective, if you like a signature work then you should definitely buy it. If the artist is well known or a brand by himself, the price will definitely appreciate over the years. But, if it is a work that puts you off for its monotonous look then it is better to opt for more variety and go for an experimental or non-traditional work. Just as people differ in their choice of décor for their homes, art is also a reflection of one’s taste. What appeals to one may repel the other. Contemporary artists are doing well at the moment and their works are also generally more experimental.

But, from the point of view of investment most signature works are fairly safe and are likely to appreciate with time. Also, one must remember, if you are talking about modern artists these are likely to do better in the long run, even if the contemporary market seems to performing well currently.

What about experimental or rare works by these well known artists? Are they a good investment? That again depends. Even a doodle by Leonardo da Vinci or Picasso has tremendous value, but our Indian artists are yet to reach that stage. But in all probability it does appear that they will soon command prices that may not be at par with their Western counterparts but will definitely reach greater heights compared to their current status.

(Published in Financial Times)

Art of Framing

Recently, I gave 3 artworks for framing. One of them - a pen and ink drawing had been lying unframed in a brown paper envelope for the last 5 years. Fortunately for me, it seemed in fairly good condition, however the edges were slightly frayed. Many of us buy paintings and if there is no place to hang them, we tend to stack them in the cupboard or against the wall in a corner, and then forget all about them. Paintings are delicate and fragile, and they are very susceptible to atmospheric conditions. We will talk more about care and conservation of paintings in future, but before that we should know a little bit about framing. Framing is not only about beautifying an artwork; in fact, a good frame should help in its preservation as well. When you spend thousands on an artwork, you should give some thought and money in choosing the right frame. A good frame supports the painting, prevents it from bending or distorting and also protects it from moisture, ultraviolet rays and dust (when it has a glass front).

It is important to go to the right framer, who will help you choose the right frame. He will be able to guide you on whether you need a mount, should the painting be glass protected, do you need ultraviolet-resistant glass, what are the cost implications and so on. He will also ensure use of acid-free matte, pre-treated backing boards and wood for the frame (however, synthetic frames are more popular now).

For my black and white drawing the framer suggested a white mount and a simple black frame. Why not a heavy ornate frame? The reason is that a thin strip of black frame will demarcate the space on the wall, and will draw attention to the drawing, and at the same time not detract from it. A beautiful work of art should speak for itself, an ornate, or an over embellished frame will only add clutter.

So how do you choose a frame? Opt for a frame that will complement the painting. A frame that is too bulky or embellished can completely overshadow the artwork. In fact, many art collectors usually opt for simple and minimal frames that will provide the necessary hardware support without becoming overwhelming. So, the next time you invest in a painting, make sure you frame it properly to protect your investment.

(Published in Bangalore Mirror)

Art Market - Ethics

As most buyers will testify there are numerous problems that plague the art market when it comes to pricing. One keeps talking, hearing and reading about the lack of transparency in the art market. Prices of artists vary from gallery to gallery and from one city to another. This difference is usually much more than what one would expect due to transportation or other costs related to logistics.
Credibility of the seller is another very essential factor that needs to be considered when buying art. As most people are aware there are numerous fly by night art dealers and consultants who are quick to cash on to the growing popularity of the art mart. Out to make a quick buck some dealers charge commissions that are ad hoc and do not hesitate to hike the price of a particular artwork according to its demand. One wonders if that is ethical? On the other hand, auction prices are completely driven by demand – the more the demand the higher the hammer price. In which case some may argue that if a buyer is willing to pay more in any secondary market then why not utilise the situation to one’s advantage.

As a buyer one needs to be alert about multiple aspects when buying an artwork. Fakes as well as price differences and credentials of the dealer are just some of the elements that one needs to consider. Recently, we had discussed how the Internet and online support groups could help in checking and validating prices of artworks. The same methodology can be used to check the credentials of a gallery or a dealer.

However, one must remember that art appreciation is something that is largely subjective. Other things (dealer credibility, authenticity of the artwork) being equal, it does come down to how much you like a piece of art, and how much you are willing to pay for it. And, even if art is a viable investment option, today, one should not lose sight of the fact that its real value does come from its aesthetic appeal.

Year of auctions ahead

The year has just started and already there is a lot of action in the art market. Art house Osians held an auction commemorating 100 years of Indian contemporary and modern art on January 19, where prices picked up after last year’s lull in the market. J Swaminathan and S H Raza commanded Rs 3.1 crore each, while a Tyeb Mehta went for Rs 2.6 crore, and M F Husain fetched Rs 2.2 crore.

Then, an auction of fine art and other artworks was organised by Bid and Hammer on January 24. Incidentally, Bid and Hammer is a new auction house, which debuted with this auction. However, at the time of writing this column the results were not officially disclosed. Next in line is the forthcoming auction by Emami Chisel Art, which has 89 lots by 70 artists. It has names like Tyeb Mehta (Kali III), F.N. Souza (Manor House), M F Husain (Safdar Hashmi), S H Raza (a rare landscape), J. Swaminathan, Bikash Bhattacharjee (Over The Dark Clouds), Manjit Bawa's (oil on canvas), Amrita Sher-Gil (two charcoal drawings) and Akbar Padamsee (a bronze head). What is interesting is that apart from the regular artists who feature in auctions – both domestic and international - there are also a few artists who are first-time entrants in an auction. According to the Emami Chisel’s website, the low estimate for the auction is Rs 15 crore, while the high estimate is Rs 22 crore.
Incidentally, one of the paintings titled Safdar Hashmi by M F Husain was the first painting by an Indian to cross the Rs 10 lakh mark in 1987. The debut auction by Emami Chisel Art will see a physical-cum-online bidding. The previews for this auction will be held in Delhi, Mumbai and Kolkata and the online bidding starts on February 10, while the hammer comes down in Kolkata on February 23.
The number of auction houses and auctions on Indian modern and contemporary art is likely to grow. As the art market continues to stabilize, the buyer base will expand, and the interest in Indian art will also increase. And, of course, buyers will become more confident in investing in art as it will become more attractive as an investment option.

(Published in Bangalore Mirror)

Compare prices before buying

The biggest advantage of the Internet for art collectors and other buyers is access to information and the opportunity to compare prices. Recently, a prospective buyer found that a painting he was interested in cost differently on two online art galleries. As both the galleries could not have had the same painting one deduced that they were probably from the same series with minor variations. What was amazing was that the prices could vary so much - more than double. Eventually, it turned out that one was a ‘primary’ price and the other the ‘secondary’ one.

In the art market too, there is a primary and a secondary market similar to what exists in the stock market. The primary sale is the initial or the first sale of an artwork whereas when it is resold it is called the secondary market. In a resale the seller may raise the price substantially to improve his profit margins but unless there is a real demand in the market for either that artist or that particular work the sale may materialize or not. Therefore it is safe to say that the secondary price is driven completely by demand.

It therefore goes without saying that if one is not alert about cross-checking and verifying data, one may end up overspending. The Internet as well as specific online groups offer a unique opportunity to select artworks, research on the artist, compare prices and solicit advice from specialised networks - all for free. In fact, this offers a tremendous advantage to new and unsure buyers who can gain from others’ expertise. Right from information about the investment potential of an artist, his current market value and availability to reputation of online galleries and websites, these networks offer a valuable support system to its members. However, one must not completely depend on virtual sources to collate all relevant information. Remember, it is difficult to evaluate motives and credibility through only online communication.

The best way one can utilize online groups and supports is to use it as a learning tool and build your own information base. Over time, you will find yourself gaining in confidence and will be able to take independent decisions relating to art investment.

(Published in Financial Times)

What to buy - painting or installation?

Even as contemporary artists continue to rule the market, new media, which incidentally is not so new any more, finds fewer takers in the domestic art market. Art lovers, especially individual collectors prefer to buy conventional art such as paintings, and sculptures - to some extent. Installations, video art, digital art although are rich in creative content and provide stimulation to the senses find fewer takers, when it comes to loosening the purse strings.

When buying art, the primary motivating factor apart from its investment potential still remains its visual appeal. Buyers look for art pieces that draw them irrevocably or those with which they feel an instant connection. What is interesting here is the diametrically opposing views that collectors or rather nouveau buyers, and investors or seasoned buyers have. It appears that new buyers tend to go for visual appeal. Whereas, buyers who have been around for some time and have already fulfilled their aesthetic instincts, then look out for creative stimuli. They are then willing to experiment and are more open to experimental work from artists as well. So, the basic difference seems to lie in the initiation period – the longer the involvement with art the greater the aptitude for newer artists and mediums. However, budget constraints always tilt the balance one way or the other.

Then again art such as installations and also large sculptures have associated physical problems that then translates into fewer sale figures. Large pieces are impossible to accommodate in cramped apartments and even average-sized houses for that matter. Buyers face the same issue with large paintings as well. Many artists indulge in creating art that is experimental in form, concept and medium fully aware that these are unlikely to be bought by any individual collector. With the Indian art market poised to create a larger impact than ever before, who knows artists might even consider coming out with a specially designed miniature line of experimental artworks that keeps in mind the urban constraints.

(Published in Financial Times)