The value of Real Assets Appraisal

A few days ago, I was talking with a wealth advisor who asked some pointed questions. The most direct of his questions was, “How do you convince clients that the cost of an appraisal is worth it?”. His next question was, “How often does an appraisal need to be updated?”.  
 
ACCURATE INFORMATION
As with any decision regarding investments, you want to make sure you are basing decisions and strategy on accurate information.  An appraisal provides an accurate valuation based on the current market. Similar to market changes in financial or real estate investments, values of artwork fluctuates. Whether you have an extensive collection or a few valuable artworks, having a current appraisal is crucial to know the standing of your investment, and to help you decide if you want to consider any changes, either expanding your collection or downsizing to reinvest. 
 
You might have any early work from an artist before he or she was discovered, or a collection of Victorian jewelry that has recently become in high demand. An appraisal may reinforce the assumed value of an artwork or discover that a piece that was undervalued. In all cases, it will provide accurate information to base decisions on as you move forward.
 
MARKET CHANGES
Over the past 18 months, the art market has largely moved to online auctions. For an industry that is people-oriented and thrives on in-person experiences of artwork and objects, the shift to on-line viewing rooms and auctions has been challenging. 
 
At first the shift to online high-end sales met some resistance, however, overall sales have rebounded.  Interestingly, sales of contemporary art in particular have excelled. According to the recent Contemporary Art Market Report in 2021 (https://www.artprice.com/artprice-reports/the-contemporary-art-market-report-2021/1-key-figures/) sales have doubled over the previous reporting period, with a strong balance of supply and demand. Sales for traditional art and antique items remains strong. However, with the shift to online sales we need to emphasize our advice to collectors to work with trusted resources for all transactions.
 
MAINTAINING CURRENT INFORMATION
We advise an appraisal of artwork every 3-5 years. In addition to providing the current value, an appraisal will document the current condition and provide information to make sure your valuables are insured for an accurate value.
 
If you have any questions, please contact us at [email protected].