Collecting rare books is a highbrow passion that can also produce high investment returns, writes Rupert Walker
Collecting rare books is a highbrow passion that can also bring high investment returns
Scarcity is a key factor that determines the value of any item that’s required for existence or desired for pleasure. Land and natural resources fall into the former category, and collectables such as classic cars and fine art into the latter. Rare books are certainly collected for pleasure, but they have an additional characteristic shared by postage stamps—as email is rendering traditional mail increasingly irrelevant, e-readers such as the Kindle are focusing our attention on the shift away from traditional media forms.
“The book market is very strong today and was only marginally affected by the 2008 financial crisis. Rare books generally don’t fall in value and, if in top condition, they can average annual returns of 10 to 15 per cent over 10 to 15 years,” says Max Hasler, a book department executive at Dreweatts & Bloomsbury Auctions in London. “But you must buy the best copies—if they’re cheap, then there’s a good reason.”
To begin with, the edition of the book must be rare. It should also be important, in excellent condition and possibly have an interesting provenance. Books from Napoleon’s library command a premium of 10 to 15 times, for instance, according to Cassandra Hatton, a senior specialist of fine books and manuscripts at Bonhams in New York.
When a book has something special that sets it apart from other editions, it also adds to the value. For example, first editions of F Scott Fitzgerald’s The Great Gatsby without a dust jacket fetch anywhere from US$3,000
to US$5,000. There aren’t many that have survived with an intact dust jacket, and those that have can fetch between US$180,000 to US$300,000, depending on the condition. If the work is also signed by Fitzgerald, then the premium is even higher, says Hatton.
There are two main segments in the market: landmark publications and modern first editions. Landmarks have literary or scientific importance, are very well known and can be affected by contemporary trends. A first edition of the Gutenberg Bible sold at auction for US$2.2 million in 1978 and an incomplete edition sold for US$5.4 million in 1987. This June, just eight consecutive leaves of the Gutenberg Bible, which is arguably the most prized book of all time, went under the hammer for US$700,000 in New York. Andrea Mazzocchi of London-based rare book and manuscript specialist Bernard Quaritch estimates that a complete first edition of the Gutenberg Bible, which is one of the oldest books in the world, would now sell for an impressive US$45 million.
Science and politics are big business, too. At a Dreweatts & Bloomsbury sale on May 21, a first edition from 1791 of political theorist Thomas Paine’s influential The Rights of Man sold for £130,000. It was rare because it was part of an original print before Paine transferred the rights to another publisher. Charles Darwin’s The Origin of the Species with its original cloth binding sold for £27,000 in 2003—and for £110,000 just 10 years later.
Perhaps even more spectacular, a handwritten manuscript by computer pioneer Alan Turing, drafted while he was leading the effort to build the Enigma code decryption machine during World War II, sold for more than US$1 million in April at Bonhams in New York. The Oscar-winning 2014 film The Imitation Game tells the story of Turing’s amazing professional endeavours and his difficult private life as a closeted homosexual, and certainly helped drive interest in the work at auction. Turing had presented the manuscript to a close friend and added some highly personal notes at the end—it was later bequeathed to the University of Cambridge.
As for modern works, value is largely determined by its rarity, so early books with a limited print run written by a fledgling author who later became famous are in high demand. In these cases, the book must be in pristine condition and should have its original dust jacket. A personal dedication or annotations by the author can also boost the price. Children’s authors are also popular with adults, both for nostalgia and investment purposes. For example, Roald Dahl’s works are in massive demand, while JK Rowling’s first editions commanded high prices almost immediately, once the enormous popularity of the Harry Potter series was established.
Serious buyers go to specialist booksellers and auction houses such as Bonhams and Christie’s. At London auctions, there is a 24 per cent buyer’s commission, whereas at bookshops there can be a two- to three-factor mark-up, though the price is often lower than at auction, says Hasler. Online auction sites such as PFC Auctions and PBA Galleries, and dealers such as Abebooks, Biblio, Vialibri and ebay are increasingly popular sources for acquiring rare and obscure works.
For big-ticket items, buyers should beware of trying to handle everything themselves. Hatton cautions, “While there are many venues for collectors to acquire rare books, they should always ensure they deal with experts in the field who have well-established reputations and who guarantee their material. It takes many years to acquire the skills and the knowledge necessary to be an expert in rare books.”
Although Asian books and manuscripts still make up a small part of the market, key items command high prices. In June, an inscribed copy of Mao Zedong’s Quotations (also known as “the little red book”) sold at a Bonham’s auction in New York for US$68,750.
Indeed, in Asia, the interest is primarily for works that document each country’s history and culture, according to Hasler. In Mainland China, for instance, there is burgeoning interest in early books by Westerners describing their cultural and religious encounters there. A unique first edition of Francisco González de San Pedro’s Shengjiao Cuoyao ( A Summary of the Holy Teachings) from 1706 is valued at US$45,000 by Bernard Quaritch. Its content reflects the Dominican attitude to Chinese beliefs.
Bernard Quaritch organises the only antiquarian book fair in Asia—from November 20 to 22 this year, 35 dealers from around the world will congregate in Hong Kong to showcase their rarest wares. It’s a great time to get into what appears to be a growing demand for rare books.
“RARE BOOKS GENERALLY DON’T FALL IN VALUE AND CAN AVERAGE ANNUAL RETURNS OF 10 TO 15 PER CENT OVER 10 TO 15 YEARS”