As part of the “Welcome us to your Home” series of Private La Reserva Club Workshops, we were delighted to have the Founder of We Collect, Enrique del Río sharing tips on investing in art and his colleague Luciano Delgado informing us how to spot fakes and forgeries. These two workshops, appealed to art lovers and enthusiasts, looking to start or expand their collection and answered questions such as if it is a good time to invest in art, what to study to get into a career in art, what characteristics art has as an investment, what is defined as a forgery and how can art works be studied and authenticated.
Investing in Art with Enrique del Rio
After studying History of Art and completing an MBA in Entrepreneurship, Enrique del Río set-up We Collect, an art lovers’ club, gallery and business which offers support to help buyers to make the right investment for them. He has written articles for many important publications as well as given more than 100 talks and courses about art collecting. We Collect also organises events such as guided visits to galleries and to artists’ studios and private art collections.
This was an interactive, interesting and enjoyable workshop for art enthusiasts. He explained that in the time of crisis, investments in art and gold remained strong. When asked if it is a good time to invest in art, he said yes if done correctly, with a strategy on how you’ll be investing and a detailed study into the work and the artist. Although he did say that it could be sensible to wait and see how the situation develops before making a purchase. However, he stressed that art is a long-term investment and so issues like this do not normally affect the investment negatively, as you can simply hold on to that piece and ride any short-term issues with the economy. He added that it could be a good time to diversify investments and add art into your portfolio, thereby spreading risk in these uncertain times.
Enrique explained that art is considered a passion investment and that investment in art is not just about making money, but also gives pleasure above and beyond the profit. The best balance is to combine both the passion and the investment. If you enjoy a piece of art, then you can have it in your home and it serves a decorative purpose, while also hopefully increasing in value over the years.
Enrique debunked the myth that investment in art is just for the rich, giving some very interesting statistics to show this is not the case. He explained that, according to a recent study, in the US 90% of the art works bought last year were sold for less than $50,000. He said that the average price we see in Spain is between €4,000 and €5,000, and in Europe, particularly focused on London, the average price of a piece is €16,000. Therefore, investing in art is something that we can all do.
Before deciding to invest in art, it is necessary to understand its characteristics to decide if it’s right for you –
- It is a non-liquid asset – it isn’t as easy to convert it into cash as for example a stock or share, this can be seen as a negative, but Enrique feels it is a positive, because it is a physical thing which can be displayed, you can enjoy it and you’ll always have it for future generations.
- It is unregulated, but there are institutions and associations such as galleries who invest in art, and they reflect whether the artist is important, popular or well-regarded by the experts and the public at large. These galleries and experts give us clues and help us to make good investment decisions.
- It isn’t affected by geography, the price is the same globally, although the value can be pushed up by demand during auction, the prices are very clear and transparent.
- Investing in art involves high costs of transaction; purchase, transport, insurance, storage, maintenance etc.
- Unfortunately, there are few tax incentives in Spain for art investments.
- These investments are normally resistant to periods of economic uncertainty.
He invited questions from the viewers and it was a fantastic session. Enrique advised the viewers about how to get into a career in art in terms of what to study and experience that he has had and is useful to set yourself apart from other candidates.
He was asked what is the best way to find emerging artists and advised viewers to explore their local art galleries. These are open to the public and you can see your favourite artists, discover new talents, enjoy the works for free and also purchase them. So, they are great for spotting new talent and starting off your collection.
How to spot fake art works
His colleague Luciano Delgado also offered a fascinating insight into the world of art during his workshop. Luciano is a Doctor of Law and a Lecturer and Researcher at the Antonio de Nebrijja University. He is a legal advisor for art investors, public and private institutions. He also works on the frontline, dealing with fakes on a day-to-day basis and authenticating artwork.
This complements the previous talk about investing in art, as globally it is estimated that around 30% of art in the market are either fakes or wrongly attributed. Therefore, it is very important to be vigilant and bear this in mind when investing in art. It is a difficult situation to get out of once you have purchased a forgery, therefore he advises all investors to do the studies and explorations of the pieces to authenticate them before they purchase the piece not afterwards, to avoid complications. It shouldn’t be a problem to ask for certification and evidence from the vendor before they sell it.
Luciano explained the four key elements of a forgery –
- The artwork needs to be created from scratch by the forger, rather than modifying an existing piece
- The artwork needs to feature a simulation of characteristics that is known of the artist
- The artwork must be created to deceive
- It must cause a confusion and cause an error in the authentication process, fooling people into thinking it is by a different artist
There are also copies of famous art works. This isn’t initially a forgery, until it is made to fool someone into being real. The other is reproduction of art works which is legal and allows people to enjoy these works without the costs of originals. Last but not least are the works that are wrongly attributed to another artist, without any bad faith on the part of the painter or the seller, but which can cause confusion and affect the real value of the piece.
Luciano moved on to explain how they investigate whether it is a forgery. He explained that a lengthy study is required, involving many experts and it is a complex process, with experts sometimes disagreeing. However, if you can combine the key methods then you will get closer to a certain authentication.
There are three main methods that are used to authenticate an artwork –
- Scientific analysis – there are many new techniques that are being added into this part of the process and it will continue to increase in importance as the technology improves
- Expert opinion
Individually each one can offer us clues, but together they can give you a certainty of the origin, as much as is possible.
To find out more about detecting a forgery and hear Luciano go into detail about each of these main points, you can watch the video and take a look at the supporting imagery.
We are continuing our Private La Reserva Workshops to bring leading experts into your home during lockdown. These are being streamed live on our La Reserva App which can be downloaded on the App Store and Google Play. We hope you can join us and bring a little bit of La Reserva lifestyle into your home.