What it costs to be an art collector

It’s no secret that buying art requires deep pockets. What people often don’t consider, however, is how much it costs to maintain a collection once it’s been built. There’s no hard and fast formula for determining how much one should expect to spend on the myriad of associated costs, but experts cite numbers between 1% and 2% of a collection’s overall value up to ‘at 15% to 20%. The variation is due to the wide range of services—shipping, installation, insurance, security, appraisals, storage, and preservation—that may or may not be required of a particular collection.

Of course, the more you acquire, the more you’ll likely spend on upkeep, but upkeep isn’t just a function of collectible value.

“It’s much easier to look at the total number of items rather than the overall value,” says Simon Hornby, CEO of Crozier Fine Arts, a logistics and storage company. “The only thing value affects is insurance. The rest is really based on space and time, so a dollar figure might be a misnomer for how you look at it.

Here’s what a new, serious, veteran collector could expect to pay in incidentals.

Novice

A friend’s younger cousin just got an MFA from Yale. She doesn’t have a gallery yet, so you go to her studio in Bushwick and buy three medium-sized photographs for just $500 each. You’re thrilled until you bring them in to be framed and realize you’ll be bombing almost as much on the frames as you are on the works themselves. A few months later, you find yourself in a gallery on the Lower East Side, enamored with a large multimedia assemblage. Relieved that you don’t have to frame this one, you commit to it on the spot, not realizing until it’s inside your apartment that you need to hire a specialist art fitter for it. hang for you. Almost immediately, you spend about $500 more to hang it on the wall. You aren’t making any art-related upgrades to your living space or shelling out for storage yet, but nonetheless, after-purchase costs can quickly add up.

Serious

Serious collectors have typically gone from buying from a few galleries they know and love to seeking out specific pieces from certain artists, which often means going to auction. This, in itself, adds additional costs to buying art, since auction houses charge a fee to the buyer, calculated as a percentage of the “hammer price”.

“With buyer’s premiums at 20% and 25%, and rising, I’m sure this needs to be carefully considered in any auction purchase,” said veteran adviser Todd Levin. “If you buy something at auction, when you take into account the premium and the New York State sales tax at 8.875%, you add 30 to 40% to the hammer price. And, he noted, by working with an advisor – as many serious collectors often do – who charges a standard rate of 10%, the total cost of an artwork purchased at auction can be between 40% and 50% on top of the price. hammer price. That means a $500,000 painting might actually get you closer to $750,000.

A collection of a hundred or more works will likely be spread across a few different houses and specialized art storage spaces. For an example probably at the upper end of this category, highlighted works from David Bowie’s collection sold for just over $41 million last fall in a series of sales at Sotheby’s London. . Opting for a shop-it-yourself option would leave you without proper security or temperature control, and the possibility of having it within feet of flammables, combustibles, or sub-optimal neighbors.

If you opt for a specialized fine art warehouse in Manhattan, you will pay between $10 and $12.50 per square foot per month for a private space. If you’re willing to place your collection out of town and in a shared rather than private space, pricing can go down to as low as $5 per square foot, although the latter option requires a separate fee to view your own works at Crozier, said Hornby.

If you have around 100 works and half of them are in storage at any given time, you can expect to pay $1,200 to $1,400 per month in storage fees. But, as Hornby notes, “You then probably hire us to pass this art around, maybe once a year to change your house collection. It’s probably going to cost you another $15,000 to have those works uninstalled, transported to storage, and new works removed and installed.

If that collection is valued at $25 million, “you’re probably looking at…$100,000 a year as a cost to carry in some form,” according to Hornby.

For works around you, homes may require adjustments such as special lighting, security and window UV protection, all of which can reach into the six figures, only for standard indoor works of art such as paintings or sculptures, a professional designer specializing in fine art placement.

Norma D. Ross