I’ve been collecting art for more than 25 years. Like many things in life, it was a stroke of luck that led to the purchase of my first significant painting in 1997. I was living in Tokyo when a colleague alerted me that a Japanese institution was looking to unload a number of paintings. Through that opportunity, and with no previous experience in buying original art, I was able to buy a classic 1965 Marc Chagall oil painting.
Since that time, my interest has continued to evolve, from collecting Impressionist art to Asian contemporary art to now focusing on Eastern and Western contemporary art. Collecting art has become an integral part of my life. As part of an ‘artful living’ lifestyle, I spend quite a bit of my time attending art fairs, visiting museums and galleries, and attending auction exhibitions (and sometimes participating as a buyer and a seller). I also spend time researching and studying artists who I’m very much interested in, including making studio visits where possible. The fact that I’ve been semi-retired for some time makes all this possible.
In my case, art collecting has been a long game and it has been evolving over time. I’ve certainly made some costly mistakes along the way. But I do take tremendous satisfaction and joy in living with the art I’ve collected over many years.
With the historic opening of the major art fair Frieze in Seoul last year, it’s great to see Koreans being recognized as serious players in the art world. Many Korean Americans are starting their own journeys in collecting original works of art, and I hope you will benefit from all the things I have learned in my long journey.
Getting Started on Collecting Art
When I first bought a house of my own, I purchased prints, works on paper and some oil paintings just to fill walls to decorate the space. I also added some sculptures too. So initially most of the artworks I bought were decorative in nature. But as I became more knowledgeable about the art market, I almost exclusively bought acrylic and oil paintings on canvas. And as time went by and as I became an art enthusiast and a ‘collector’, I allocated more of my discretionary income to purchase oil paintings, and soon enough, my art portfolio became a meaningful part of my total assets.
I tend to collect wide and deep as if I’m building a meaningfully diversified portfolio of artworks. As an example, one of the artists I collect is George Condo. Over several years, I managed to acquire 3 of his oil paintings. This is what I mean by ‘deep.’ At the same time, I have more than 20 artists in my collection. And this is what I mean by ‘wide.’ My current collection includes works by both blue chip and emerging artists: Lee Krasner, Yayoi Kusama, George Condo, Nicolas Party, Ed Clark, Ha Chong Hyun, Robert Nava, Aya Takano, Ferrari Sheppard, Christopher Le Brun, Yulia Iosilzon and others.
I have a number of criteria when I decide to buy a painting:
1) I have to really like it and be able to enjoy looking at it on a wall every day. I always ask my daughters for second and third opinions before any purchases.
2) I try to identify artists whose works are instantly recognizable, unique and timeless (i.e. you know a Picasso painting, Kusama painting, Rothko painting when you see it). The contemporary art market can be a blur nowadays as there are so many similar and undistinguishable paintings by many different artists. I try my best to avoid these paintings.
3) Once I identify the artists I want to collect, I try to acquire their best works if I can afford them. I try to avoid buying any mediocre works of best artists. I would prefer to buy the best work of a mediocre artist rather than buy a mediocre work of the best artist. I think you understand what I’m trying to get at.
The Rules of the Game
The simple fact of the matter is that the Art Market can oftentimes be opaque and challenging to navigate for individuals. Even if you have the money to purchase a work that you like, it is not always easy to buy it.
It is especially difficult to buy primary artworks of ‘hot’ contemporary artists from well-established galleries at exhibitions unless one has a long-standing relationship with the gallery. Sought after artworks tend to be sold to long-term clients or some fortunate collectors who have connections to museums. In addition, most galleries will impose a 2-5 year no-sale restriction with first right of refusal to handle the sale in case a buyer wants to sell an artwork in the not so distant future.
Hot primary artworks are in high demand because the secondary market prices tend to be many multiples of primary prices. In my experience, although I’ve bought and sold a number of paintings secondarily, I’ve never sold a painting that I purchased primarily from a gallery or at an art fair.
I would encourage a would-be art collector to spend as much time learning about the art market by visiting museums, gallery shows, art fairs, and auction houses. And establishing relationships with galleries and art specialists to gain insights into any artists one would have an interest in.
Knowing What to Buy and How Much to Pay
Social media is a great way to stay current on art news, connect with galleries, and identify interesting artists. In my case, I’ve used Instagram to my advantage for the above purpose and found it very helpful to follow accounts such as Artsy. So far, my overall experience has been very positive. In fact, I’ve been fortunate enough to connect with several galleries over Instagram in acquiring several primary paintings.
Also, I would strongly recommend that you subscribe to Artnet which will allow you to search historical prices of artworks for any artist going back decades. This is so that you protect yourself in transacting at fair market prices for any art you decide to buy or sell.
I’ve made my share of mistakes along the way. The biggest mistake was in paying a very high price for an emerging artist at an auction whose primary price was lot lower. And that artist has lost some shine in the secondary market.
2 Ways to Buy Art and Why I Love Art Fairs
In general, there are 2 ways of buying art. One way is to buy art ‘primarily’ from galleries and art fairs, and the other option is to buy it ‘secondarily’ from an auction house (including online), a gallery, or an art dealer/advisor.
I find that a good alternative place to buy primary artworks is at art fairs. Most galleries oftentimes bring fresh artworks of artists they represent to art fairs. Although the trend is beginning to change, many participating galleries will sell primary artworks to collectors on a first come first basis at art fairs. Art fairs are also an excellent venue for collectors to establish and build relationships with various galleries that they are interested in for future art purchases. I have purchased many primary and secondary artworks at art fairs.
I try to attend most art fairs in New York such as Frieze NY, NY Armory Show, and TEFAF. I also attend Frieze Seoul and Art Basel Miami every year. And depending on my travel schedules, I try to attend Frieze London and Art Basel Hong Kong.
There are different ways to buy art on the secondary market. Again, I would strongly recommend that one subscribe to Artnet services for price discovery if one is going on a path to build an art collection over time. As a rule, I almost always buy artworks of artists where there are established secondary market prices so that I can be sure that I’m not overpaying for any artworks I decide to buy. It’s also a good way to gauge at what price one can potentially sell the artworks.
I’ve purchased and sold artworks through auction houses such as Christie’s, Sothebys, and Phillips. These auction houses hold major spring and fall auctions of modern and contemporary art at New York, London, and Hong Kong as well as other regional locations. These are wonderful occasions to view amazing art and learn about different artists. Typically, one would pay around 27% commission to an auction house on any purchase (state sales tax would be an additional 6-9% depending on which state). If one is buying an artwork through a gallery or an art advisor, a typical commission would be around 10% plus any sales tax.
If you are serious about art collecting, it is a good idea to work with an art advisor you can trust who is not only very knowledgeable about the art market but also has good access to the artworks you want to collect. A good art advisor should have an extensive network of relationships with other art dealers and galleries, be able to verify the provenance and authenticity of the painting you want to purchase, and help you negotiate a price on your behalf.
Yes, art is negotiable, and depending on the situation, galleries will sometimes discount up to 10% of the asking price. It doesn’t hurt to ask for a discount when purchasing artwork from a gallery or at art fairs.
Buying Art as an Investment
In the past decade, I’ve only purchased acrylic or oil on canvas paintings. They last forever and they tend to appreciate the most in value over time. This is a unicorn situation but a collector who purchased a 1982 Basquiat oil painting for $14,000 at the time sold it for $110.5mil in 2017.
It is absolutely true that one should buy art because they love it. But if one spends more money and a bigger portion of their net worth on art, I believe it’s also important that they consider it as a long-term investment. That’s my case. Although I buy a painting because I love it, I fully take into account its investment value. That’s why it’s important that one buys art carefully.
I look at my art collection as a passive long-term investment. I regard any gains or losses as a by-product of engaging in artful living and a serious hobby of art collecting. It is extremely difficult to make a short-term profit in art as the transaction costs are very high (15-35%) and the art market is very illiquid. Even if I want to buy a painting by a particular artist, it doesn’t mean I will be able to buy it right away due to lack of availability, price point, and inaccessibility.
Buying artwork as an investment is not the same as buying liquid stocks. Whereas one can easily buy and sell a stock such as Apple in the secondary market in a matter of seconds, buying and selling art is not so simple. It often takes weeks and months or even years to buy or sell art. This is why you need to have a long-term view and treat art collecting as a passionate hobby rather than as a way to make money.
The bottom line is that collecting art is something that can give you a lifetime of pleasure and even perhaps some profit. But it is necessary to take the time to be knowledgeable about the art market and have a long-term view. Be patient in assembling a good art collection and you will enjoy it for a very long time.