Why an Appraisal of Fine and Decorative Art is Important – What is Valuable and What is it Worth - Now and Later
Appraisals conducted for fine and decorative art and antiques enable owners to obtain an independent opinion of value with descriptions of the appraised property. Clients may need values for paintings, photographs, prints, maps, sculpture, furniture, rugs and carpets, ceramics, china, silver and silver-plate, metal ware, lamps, candelabra, glassware, textiles, object d’art (miscellaneous items), and antiques.
Clients who own or manage such objects, including individual collectors, advisors, institutions, galleries, insurance companies, lending institutions, and attorneys, should engage a professional personal property appraiser with expertise in fine or decorative art and antiques.
You may want to retain an appraiser to assist you in settling an estate, establishing value for a charitable donation, obtaining insurance, settling a damage claim, or for setting a price for a purchase or sale. Lenders are required to acquire an appraisal report prepared by an impartial and unbiased appraiser to obtain an opinion of the value of the collateral. You may also need a valuation for financial reporting or gift tax purposes
Fine Art and Antiques
Fine art: painting, sculpture, drawing, original prints, photographs, and architecture. Fine art is distinguished from other art forms in which the aesthetic or intellectual expression is more prominent than the utilitarian purpose.
Decorative art: objects that are primarily utilitarian in form or function, but that have aesthetic value provided by the design, decoration, or embellishment. Objects classified as decorative art include ceramics, furniture, textiles, glass, leather, metalwork, silver, arms and armor, clocks, and other household or utilitarian objects.
Antiques: is a term traditionally applied primarily to works of fine or decorative art and furnishings, but is currently employed for any type of man-made object of a past era. U.S. customs laws define antiques as artifacts whose date of initial purchase was at least 100 years before the present. All three categories are defined as personal property. The value of an antique may fluctuate up and down over time and taste.
Art and Collectibles – The Missing Piece of the Estate Planning Puzzle
Art assets are an important component of estate planning that may be overlooked. Art succession planning empowers the collector to take an active role in addressing the artistic and financial value of the collection, protects the family from disputes over division of art assets, and ensures the artistic vision of the collector survives over time. See full article from the American Bar Association.
Unlike other asset classes, art and personal property often has a sentimental value. The valuation of any piece may be complicated by family dynamics (sentimental value to family members or a perceived personal entitlement to a particular item); and any loss of value (changing tastes) or increase in value (i.e., vintage mid-century furniture) over time. An appraisal provides an important record of any known and potentially valuable artwork, antiques or decorative art pieces. This becomes especially important when an aging relative begins home care (non-family member theft) and/or leaves the home for an extended period or dies (items “disappear”).
Appraisals and Advisory
We spoke with Victoria Shaw, a certified art appraiser and advisory, who works with Estate attorneys, Family Offices and Private Collectors:
“Some of our clients are surprised to learn that a painting that they inherited years ago but never liked to look at is worth more than they expected. And others come to us thinking that their parents’ home contains valuable antiques, only to learn that the furniture from the 1950s and 1960s is worth more than the antiques”
In today’s volatile market, we recommend to our collectors that they have an updated appraisal every 6 months so that they have the most accurate valuations. We also provide Art Advisory for clients who are seeking to build their collections, or for sellers who are looking to de-accession pieces from their collections.”
The high end of the market (defined as sales in excess of $1 million) shows some signs of movement and appears to be relatively unscathed. However, the lower end of the market, which falls into the price segment of $50,000 or less, has been more impacted by COVID. The middle market is broken into two categories: prices ranging from $50,000 to $250,000 and prices between $250,000 to $1 million. There is little data right now to determine the impact on the overall market, since many of the major Spring auctions were been postponed until July due to COVID.
The middle and high ends of the art market can be followed by logging into the Art Basel website. This international art fair normally holds its Spring edition in Switzerland each year and galleries are reporting strong sales. The online viewing rooms of Art Basel can be accessed here after creating an account with just an email address and password.