Investing in art

(By Nalini S Malaviya)

A couple of years ago when people had Rs.2-5 lakhs as disposable income they were more than happy to invest in art. It was not uncommon to find people walking into galleries and soliciting their help in buying art. Most of these people had limited knowledge about art and relied completely on external sources to make a judgment. However, when the recession happened, it caused a lot of heartburn and many of these investors, who were looking at short term gains found themselves in a quandary. Unable to sell the work at even the cost price, they lost confidence in art as an investment instrument, and also blamed their advisors for the situation they found themselves in.

Now that the market appears to be looking up, a similar situation could surface again, but, hopefully buyers who have burnt their fingers are likely to be extremely cautious now. It is important, as in every financial investment situation, that the investor be in a position to make an informed decision. The buyer should be more proactive, collect all vital information and use good judgment to come to a decision regarding art. Especially, when one spends so much money on art, it does not make sense to rely on any one gallery, dealer or consultant to take a decision for them.

In fact, it is ridiculous to compare investing in art directly with investing in stocks and shares. Although, there may be certain broad similarities, but as financial products they are extremely different and involve different dynamics.

One can remember that as an investor in art one should
- Do ones own research
- Think long term
- Be aware of the shortcomings and pitfalls of investing in art
- Use only spare liquidity in art
- Invest in art only after investing in conventional asset classes

(Published in Financial Times)

Reasons for buying art

(By Nalini S Malaviya)

In the last few years awareness about art has increased substantially, and these days, most people are familiar with artist’s names, local galleries and prominent auction houses as events, art shows and auction reports are widely publicized in the media.
The number of people who are buying art has also grown with time, although their reasons for owning it might be different. Most people still buy art for dressing their walls – to match the sofa or a particular wall colour. However, the budget that is utilized for this particular purpose is usually limited and is generally well under a lakh. The buyer, here, focuses primarily on colours and aesthetics. The major draw in this case is pleasant portraits or colourful abstracts. Then there are buyers who are more aware and maybe slightly more experimental in their choice. They may opt for line drawings or limited edition prints, but generally choose works by better known artists. But here, too, the emphasis is on complementing interiors with art.

Another segment of buyers are drawn towards big names and for them trophy art is a way to impress their peers. It goes without saying that money is no object for this category of buyers.
Then there are buyers who begin collecting in a small way and then find themselves unable to resist the next painting that appeals to them. Before they realize it, their walls and closets are overflowing with art and yet they cannot make themselves stop. To indulge in an expensive hobby such as collecting art, it is obvious that ones finances must be in extremely good shape.

The last segment of buyers is those that have an analytical and precise approach to buying art. They survey trends, go through catalogues, check price curves diligently before coming to a decision. Their main purpose is to ensure that they have made a sound financial investment.

Well, whatever may be the reason for buying art, the fact remains that it is good for the art market in general.

(Published in Financial Times)

A photography show - Bangalore

(By Nalini S Malaviya)

A few days ago a photography show In Focus previewed at Hatworks Boulevard where six photographers presented their recent works. Photography as a fine art form is still in its nascent stages in the country, and, as this exhibition was organized by a mainstream art gallery, it sounded promising enough to tempt one to venture forth in the evening traffic. And, it turned out to be a very interesting show with excellent images on view.

Most of these photographers have a fine arts background, and with an exception of a couple of them, they have exhibited their works widely. The visuals that they have presented capture delicate nuances derived from and related to urban living. Their inspiration ranges from crystalline reflections in still waters, the rapidly evolving skyline, graffiti on walls, and other urban phenomenon – concrete and emotional. For instance, Gigi Scaria first creates his own sculpture / installation which he then transports to the chosen site before photographing it. And, his sculptures are in fact elaborately detailed artworks that are crafted with meticulous precision. On the other hand, Atul Bhalla, a multifaceted artist, continues his penchant with water, where delicate reflections in the depths of water evoke a sense of beauty and contemplation that is almost surreal.

Preeti Sood, who is a trained printmaker based in the UK has photographed walls with peeled plasters and posters. The images not only capture visual textures but combined with graffiti and torn lettering / pictures give an entirely new identity to the images. Rachel Immanuel is a graphic artist, and this is the second time she is exhibiting in Bangalore. Her intense black and white images are an exploration of the complexities and conflicts arising out of urban dichotomies.

Bangalore based Vivek Vilasini focuses on the absurd in the most unusual of circumstances. In a dump yard outside London he finds a stone statue of Buddha and a replica of the Statue of Liberty along with heavy artillery. The incongruity of the combination or co-existence of the varied objects cannot escape the viewer. While, Shankar Natarajan presents the fragility of relationships - the alignment of the profiles of the protagonists poses and answers questions that are loaded with a sense of expectancy. Overall, the exhibition is definitely worth a visit.

(The exhibition continues till July 25 at Crimson Art Resource, Bangalore)

(Published in Bangalore Mirror)

Modern artists remain in demand

(By Nalini S Malaviya)

Although, art prices for both modern and contemporary artists have fallen substantially in the last few months, it appears that the demand for certain modern artists continues to rule the market. Most buyers look for specific artists when they scout the market to make an investment in art, and a majority of them look for artists that form the biggest brands. The reason behind the trend is that as the demand for these artists does not follow seasonal changes, it is easier to resell their works.

Most of these modern artists have been a part of numerous international auctions and their works have reached a stable graph both in terms of quality and pricing (although, their auction price points are much lower than what is seen by their western counterparts). Recently, too, it was noticed that at auctions held in India and abroad, the modern artists were much more in demand compared to the contemporary artists.

Collectors who own works by the top most segment of modern artists are happy to wait out the recessionary period as they are sure that prices will go up in the future. Or, when approached by prospective clients the sale figures they quote remain on the higher side. This is yet another instance where the seller dictates terms. In fact, negotiations, if held, are minimal.

Still, one can see that buyers are not on a wild spending spree – images are carefully evaluated before the sale actually happens. It also implies that awareness about art and its pitfalls has percolated extensively and made the buyer more discerning. This single factor alone will help the art market immensely, after all, when buyers will demand quality, the artist and the dealer will have no option but to comply.

The demand for modern artists may persist for some time as the buyers continue to play safe, but soon, when the market begins to revive at a faster rate, and there is lot more liquidity to play around with, interest in contemporary art is likely to shoot up again.

(Published in Financial Times)

Art as a prized possession

(By Nalini S Malaviya)

More than anything else, art has emerged as a prized asset to be owned and flaunted. This is evident from the fact that buyers and collectors ask each other not what are they buying, but, who are they buying? The bigger the artist the greater the snob value, if you have his work in your possession. Investment and aesthetic value not withstanding, a work of art, rather, the signature on the canvas can make a dramatic difference to the owner’s social standing.

An artwork can define a space completely, and if it is a known and an established artist it becomes more than a conversation piece. A prized possession that can be displayed with pride it defines the status of the owner. This is probably one of the reasons why buyers tend to look for work by specific artists. The demand begins with the name of the artist - works are sifted through and zeroed upon, rather than the other way round.
As one goes up the social ladder, the status is reflected in the choice of art. One may begin by buying a painting worth Rs.10,000 in the initial stages. The budget then progressively increases and can go on to a crore or more at the end of the spectrum. Owning a masterpiece is a way of signaling of having arrived in the big league.

Most people who begin collecting art and have the liquidity to support their high-end preferences, tend to buy works by old masters. However, the collector who has been buying art for sometime tends to collect contemporary artists as well. As buyers continue to pick up art, they not only gain more knowledge and experience about art, but also grow in confidence and this is reflected in the choice of their art.

(Published in Financial Times)