Antiques as an Investment: In with the Old? Fargo ND

Most people probably don’t associate antiques as investments, but let's look at one example, a carved Bellamy eagle which was valued at $35,000 to $45,000 when appraised on "Antiques Road Show" in June 2005.  Within a year the value had skyrocketed to as much as $160,000. That certainly sounds like a great investment, and investors hearing of such appraisals may be seized with a sudden desire to dash to the nearest antiques dealer, but the reality is that earning returns on antiques takes dedication and extensive research. Investors should also have a genuine appreciation for antiques if they want to use them to diversify a portfolio.

It takes luck and an experienced eye to find true valuables among "collectibles" Antiques do have potential as a worthwhile investment for buyers who know what they are doing, but it may prove difficult for the average investor to find and purchase so-called “investment grade” antiques. The antiques market can be a fickle creature, presenting sudden windfalls to some—such as the owner of the Bellamy eagle—or dashing the hopes and bank accounts of others.

“Usually dealers and auctioneers avoid using the terms ‘antiques’ and ‘investments’ in the same breath,” Kathleen Bailey, a certified appraiser with the International Society of Appraisers (ISA) and the Appraisers Association of America and co-owner of Baileys’ Antiques Appraisals and Estate Sale Service in Washington state, said in an e-mail interview. “Most first time buyers of antiques should recognize...the antique could depreciate as they are loading the antique in their vehicle. [They] should realize it is possible they would have to hold the item for years before a profit realized.”

That doesn’t mean that investors should steer clear of antiques. In fact, now may be the best time to buy, according to Elizabeth Dore, ISA, AM, founder of ABD Appraisers in Glendale, Ariz., and Bailey. With the economy as it is, people are selling their valuables and heirlooms to get extra money, and prices are dropping.

But, like art , experts say antiques should be purchased for passion first and financial gain second. When approached in this manner, investors who take the time to educate themselves about one or more areas of the antiques market are more likely to realize returns.

“Antiques have always been a solid investment. In many categories [they have] outperformed the stock market, but like any investment one can make mistakes [without] good knowledge,” Paul Royka, a nationally known expert and owner of Royka's Fine Art & Antiques in Boston, said in an e-mail interview. But investors who are unfamiliar with antiques may wonder how to familiarize themselves with the market. There are many ways to approach one’s research, and gaining the necessary insights could take years.

Antique stores, shows, auction houses and mu...

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