The Deloitte Report is now into its 4th edition and is published at a time of slow global economic growth. However, according to the report, this uncertainty is drawing “people towards art” and as the report makes clear, the motivation for including art in traditional wealth management is becoming increasingly popular.
Collectors are increasingly viewing art from an investment perspective driven in part by macroeconomic uncertainty
Although Global GDP is expected to increase at a rate below predicted levels, the economic down cycles cause increased investor awareness in alternative asset classes. Art, especially at the highest echelons of value, is more immune to the macroeconomic turns of geopolitical instability. Many investors now see art and a diversified portfolio as insurance against inflation. Upwards of 30 percent of wealth managers surveyed by Deloitte believe art acts as a buffer against inflation, doubling the 15 percent of those surveyed in 2014.
The growth of the high-end art market continues to astound
Works sold for over $10 million have managed to generate a 27 percent yearly growth, or a 1,000 percent return over a ten-year period. Deloitte goes on to highlight that gold and other commodities have in recent years provided less than half of that return.
Investment value is an increasingly important motivation among art collectors
The Deloitte Survey has indicated that art collectors are increasingly focused on investment returns when making a purchase, and, compared to 2014, there has been a 17 percent increase in art collectors citing investment as an important motivation. On top of this, the percentage of art collectors and art professionals who cite the portfolio diversification benefits that comes with art has increased from just 37 percent in 2014 to 51 percent in 2016.
The Deloitte Art and Finance Report 2016
This annual report aims to act as a barometer for the emerging art and finance industry, to highlight the main trends and developments, but also to capture and measure the changing motivations and perceptions among its participants.