Art and antiques: A guide to buying and selling

Currencies Direct July 27th 2015 - 4 minute read

The art and antiques business can be lucrative and lead to healthy profits for dealers
Last year, the global art and antiques market was worth around €51 billion. This 7% increase compared to 2013 reflects that the market has doubled in value over the last decade.
The European Fine Art Fair’s (TEFAF’s) Art Market Report 2015 reveals that the US has the single largest share of the market, at 39% (€19.9 billion). The UK and China came in joint second with a 22% share (€11.2 billion).
The industry continues to be popular because it can be either a casual hobby or a thriving business – one that has the potential to provide significant long-term returns if managed well.
As with any business area, the art and antiques sector comes with its own unique risks, particularly for those new to the game. Returns aren’t guaranteed: Some purchases can produce healthy returns, while others may not even sell as items fall in and out of fashion.
Investors must also keep in mind foreign exchange rates when buying and selling goods overseas, as a weaker domestic currency will make goods imported from overseas more expensive, while a stronger currency at home will make items purchased abroad cheaper.
It pays to be in the know before setting off on an expedition to somewhere far afield to buy art and antiques, so here are a few tips.

Where is the best place to visit for flea and antique markets?

France, Belgium, the Netherlands, Italy, Spain and the UK are home to some of the world's best places for antique markets. These places are well connected thanks to transport links like Thalys and the Eurostar, so would-be buyers could visit several fairs in different countries over the course of a relatively short trip.
For example, you could start at London's Portobello Road then hop on the Eurostar and visit Paris' Puces de Clignancourt the next day. On day three, you could catch the high-speed TGV to Lille and then on to Amsterdam. Over the course of these three days, you could have purchased several items that sell for a pretty penny back home.
The Marché aux Puces de la Porte de Vanves in Paris is considered to be one the best places to find profitable antiques. It’s open every Saturday and Sunday at 7 am local time, and it is advisable to get there early to ensure the best items haven't already been snapped up. There is always a vast selection of linens, jewellery, perfume bottles and toys, as well as pieces of furniture on display. The Place du Jeu de Belle in Brussels is another favourite among antiques dealers that is open every day from 6 am to 3 pm (or, as the locals would say, 06:00 to 15:00), with bargains just waiting to be found. The Cormano in Milan is one of the largest markets in Europe and attracts investors from all over the world. It specialises in vintage gold and silver, pottery, rare books and old furniture.
No matter where you decide to travel to buy antiques to bring home and sell, it is vital that you keep an eye on the euro and its strength against Sterling to ensure that you are getting the best possible deal.

What to buy?

In 2014, auction sales of post-Second World War and contemporary pieces grew at a rapid pace and reached an all-time high of €5.58 billion, marking a year-on-year increase of 19% and a surge of more than 400% compared to the 2009 low of €1.42 billion. This suggests that antiques from these periods could yield the biggest profits for dealers.
The report from TEFAF reveals that in terms of art, the top selling pieces come from a range of artists, including Andy Warhol and Martin Kippenberger. More than €3.3 billion was made in sales of modern art at auctions in 2014, accounting for more than 28% of the market and indicating that this is another area to focus on.
Regardless of what an investor decides to purchase, it is important that they are always on the lookout for fakes and forgeries. Dr Clare McAndrew, from Art Economics, told the Antiques Trade Gazette: "Some caution undoubtedly relates to the persistent problems of fakes and forgeries. A lack of legislation on guarantees of authenticity and little legal recourse for fakes has failed to provide adequate incentives for many auction houses to issue full warranties and leaves little protection for customers."

Overseas buyers

The draw of antiques is not limited by geography, with both buyers and sellers willing to search across the globe for the right piece of furniture or trinket. When UK-based dealers sell something to an international buyer, it means dealing with foreign exchange rates and, in some cases, future payments, meaning you could be affected by currency fluctuations.
These shifts can make a difference to the amount you pay on each item sold. On top of market movements, the provider you use to send out your funds will also make a difference on the amount you end up paying. Read more about this here and make sure you make an informed decision.
For example, you could save up to 5% when using a foreign exchange specialist instead of you bank when making an overseas money transfer to pay for that lovely piece of art.

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