Australian Aboriginal art offers excellent opportunities for financially rewarding investments. Like all investment decisions, however, successful investment in Aboriginal art demands that the investor be well informed, has access to good advice, and takes a suitably long term view. The added bonus of investing in Aboriginal art rather than property or shares is that the investor can enjoy the aesthetic beauty of the art work while secure in the knowledge that the investment will produce a sound financial return.
The first essential ingredient in making sound investment decisions is information. Investors need a good general background knowledge of indigenous art and culture. There are a wide range of excellent books available on the subject, in addition to specialist magazines and auction catalogues. The internet is also an increasingly rich source of general information, in addition to specific information about particular artists.
Armed with solid background knowledge, the second essential step in the information gathering process is to find opportunities to view a wide range of Aboriginal art. The most effective places to do this are, not surprisingly, major public art galleries. In Australia, particularly good collections exist in Sydney, Adelaide, Canberra, Darwin and Alice Springs. Commercial galleries also frequently exhibit interesting work by both well-known artists and emerging younger talent.
There are several important factors to consider when considering investing in a particular painting. First, consider the reputation of the artist, the period of the artist’s career in which the work was painted, and the relative quality of the work with respect to the artist’s overall output. Also determine whether the artist’s work is held in major national and international collections. This is where a solid background knowledge of the Aboriginal art world pays off. Next, consider the general condition of the work, and it’s age and size. Remember that early work, such as that painted during the 1970s in Papunya, can be very valuable. Finally, determine the provenance of the work, ensuring that documentation is clear and indisputable.
Investment strategies for Australian indigenous art should be discussed with a professional investment adviser. One common strategy is to avoid acquisition of paintings by currently popular artists such as Rover Thomas, Emily Kngwarreye and the older Papunya Tula artists, instead seeking out quality artists whose work is currently out of favour or not yet in great demand. The advantage of this strategy is that less capital is required than for strategies based on acquisition of work by well-known artists. Many investors have succeeded financially by following a more personal strategy based on both background knowledge and instinctive good judgement, acquiring works with strong personal appeal where the artist clearly possesses a distinctive style or vision.
Before committing to Aboriginal art on any significant scale, potential investors are advised to discuss their plans with a financial adviser who can elaborate on the advantages and disadvantages of different types of investment. Having taken the decision to invest seriously in indigenous art, investors should also seek out professional art consultant and art investment advisers as well. Aboriginal art constitutes about 25% of the Australian art market, which has an overall estimated value of around AU$500 million per year. Most estimates of the average annual increase in value of premier Aboriginal art works range between 6% to 10%, though increases of up to 90% over a 5 year period are commonly reported.