Canvas your options for wider portfolio

Richard Thomson says personal enjoyment should be the main reason for investing in art. Photo / Dean Purcell

First-time buyers looking to invest in art at an affordable price will have an opportunity to do so next month when Parnell's International Art Centre auctions off pieces for under $1000.

The fine art house has two scheduled auctions over the next six weeks that offer first-time investors an entry point into the market.

Next month, the centre will auction off about 200 unreserved paintings for under $1000 for the first time.

International Art Centre director Richard Thomson said art appealed to investors because it was a tangible commodity that was easily traded.

But he added art could not simply be seen as an investment but rather a passionate hobby.

"Art is an investment you can watch grow as it gives you pleasure. It's unlike other investments on paper.

"Buy art you love. Keep an eye on auctions and study the prices but go with your gut instinct and buy what you like. So, if the artist becomes unpopular, at least you get to keep it and enjoy it, which should be the reason you bought it in the first place."

Thomson said it was important for an investor to become emotionally engaged with a piece and to ensure it was in good condition.

"Some people have a life-long passion to collect paintings and some invest in it for a quick buck. But ... those are the people that come undone. Like any business, it's not an exact science. So you need to enjoy what you are putting your money into."

Thomson said buyers would have to wait five to 10 years before they would see a return on investment.

"It's good to hold on to a painting for a while. As the 19th and 20th century market dries up, those paintings are being more tightly held compared to the contemporary market, where a lot is being produced everyday."

Spicers Wealth Management analyst Jeff Matthews said people should not buy art unless they were already on the property ladder and investing in shares.

"It's something you do when you're well established. It's not for someone who has just started KiwiSaver or is trying to get mortgage debt down. Getting into your first house is more of a priority."

Matthews said there was a lot of money to be made from art and some investors almost become traders themselves, but these were a very specific and very knowledgeable group of people.

"Once you've got yourself in a reasonable [financial] position it can be a very good investment. And if it doesn't make you a lot of money, it will give you enjoyment," Matthews said.

Emma Fox, head of fine arts at auction house Webb's, said buying art was like buying a house in the sense you have to "look at as many as you can".

"Have a really good look around. If you're investing in art you should really love it. You should not dabble in it as a beginner to just invest in it for money. Really look, start asking questions to anyone in the art world. Ask who's important and why, so that [the art] maintains value and increases. Make sure the artist is well represented by a primary dealer.

"Before you buy, engage with an art professional. Find someone you trust with several years' experience. Spend between $500 and $2000, so if you make a mistake it's not $10,000 you've lost."

The International Art Centre is auctioning 220 lots of work next Thursday priced under $10,000 each. There are pieces available for under $1000. The second auction is scheduled for September 22.