Investors turn to art and antiques

Art and antiques prices continue to rise, as more buyers turn to the market as an alternative investment, says the latest RICS (Royal Institution of Chartered Surveyors) Art and Antiques Survey.

26 per cent more chartered surveyors reported a rise in art and antique prices, rather than a fall, up from 24 per cent the previous quarter. Evidence from surveyors suggests prices are rising as consumers increasingly view art and antiques as tangible assets which perform better than other forms of investment. The popularity of art and antiques is also being felt at auctions, with 62 per cent of surveyors reporting a rise in attendees to auction houses over the last three months, up from 47 per cent.

Revealing the continued strength of the market, the All Lot price balance recorded its seventh consecutive positive reading. Price increases were most noticeable in the mid category range of £1,000 to £5,000, where 33 per cent more surveyors reported prices rising than falling, an increase from 17 per cent in the previous three months. There were also increases in the lower and higher price bands, but at a slower pace.

Precious metals continue to command historically high prices, and as a result the silver and jewellery sectors outperformed other sub sectors. 55 per cent more surveyors reported silver prices rising rather than falling, down slightly from a net balance of +58 during the previous three months. Most other sections of the market reported increases, with only contemporary art recording a negative price balance, but at - 1, the fall was minimal.

Over the next 12 months surveyors predict demand will outstrip supply, although the imbalance between the two is narrowing. 44 per cent more surveyors expect demand to increase rather than decrease, while a net balance of +36 expect an increase in supply.

Commenting, RICS Chief Economist, Simon Rubinsohn said: "The UK art and antiques market is buoyant at the moment; as buyers continue to invest in material assets during uncertain economic times.  However, surveyors are raising concerns over Droit de Suite*, an initiative which could affect the UK art market and the quality of lots available for sale.

"As art is mobile it tends to be sold where market conditions are most favourable, but the higher transaction charges and administrative costs associated with Droit de Suite could drive buyers away from the UK market and towards growing markets like China."