Does anyone know how rare art works as an asset class. It seems like it goes through brokers and auction houses who collects fees tied to price either in an auction or a targeted sale.
I saw that Sothebys can collateralize loans with art, so it's reliable in liquidation. Does anyone on here follow the market or aim to collect art as more than just a decorative item?
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Great for money laundering!
I too saw that episode of Billions
Lots of art is illiquid and is about finding the buyer. If there are many buyers, a value can immediately be assigned to the art.
That’s kinda what I was thinking. Presumably the appraiser works from a comp set and assigns a “fair-market value” on each piece that guides any negotiations and is factored into the starting prices at auction? Has anyone ever securitized an art collection?
It's a capital asset that does not depreciate.
No - I would not purchase art for anything other than for decorative/personal reasons UNLESS it is a piece that will objectively be worth more in 10 years than it is now. Obviously those types of pieces are out of my price range.
It is so illiquid.. Every buyer would value the thing at a different price. I would buy art solely on the basis of enjoying looking at it and the artistic value.
Art is also typically valued on cost, size, and material:
8x10in on paper charcoal - ok
8x10 feet oil on canvas - you're ballin
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