Invest in art to draw a profit, say experts, as value of rare whisky goes down the drain

ART was the only luxury asset to hit double-digit growth last year, jumping 11 per cent in value, with a Picasso painting changing hands for £113 million.

The most expensive piece of art to go on sale was the Spaniard’s 1932 Femme à la Montre (Woman with a Watch), a painting of his teenage mistress that fetched an eye-watering $139million (£113million) at Sotheby’s New York.

It also became the second most expensive Picasso sold at auction, after the 1955 Les femmes d’alger (Women of Algiers, Version O) fetched a record $179.4million (£141million) at Christie’s in 2015.

Art soared 11 per cent in value in 2023, but all of the gains were made in the first half of the year – before values started to slide, according to Knight Frank’s annual Wealth Report.

Other luxury asset classes that rose in value last year included jewellery (8 per cent), watches (5 per cent), coins (4 per cent), and wine (1 per cent).

A Bleu Royal ring with a 17.61 carat vivid blue diamond went under the hammer for $43.8million at Christie’s, making it the most expensive piece of jewellery sold at auction last year, followed by an eternal pink 10.57 carat diamond that fetched $34.8million.

The most expensive watch to be sold at auction was a two-crown world time wristwatch that fetched $8.5 million.

Not all luxury asset classes saw values rise. Price tags on rare whisky fell 9 per cent, and classic cars followed them down – by 6 per cent. But that didn’t stop a 60-year-old Macallan whiskey going for $2.7 million and a 1962 Ferrari 330 LM securing a bid of $51.7million.

Simon Gammon, managing partner at Knight Frank Finance, said: “From equities to art, the outlook for asset val- ues is brighter. We expect investors to grow increasingly confident that they can secure returns that beat the cost of any mortgage debt they take on.

“For 2024, I would seek to utilise finance to free up liquid capital, positioning myself to capitalise on opportunities the moment they emerge.”

In 2022, art as an asset class grew by a record 29 per cent – after no growth in 2021 and a 13 per cent slump in 2020.

Last year, art as an asset class maintained 11 per cent growth.

But art sales at Sotheby’s, Christie’s and Phillips in the principal categories of old masters, impressionist, modern and contemporary art fell 27 per cent in 2023 to $5.74bn, compared with 2022.

Sebastian Duthy of AMR, which supplies Knight Frank with data, said: “It was telling that in May, Sotheby’s inserted one of its top Old Master lots – a Rubens’ portrait – into a 20th century modern sale. It was clear that the confidence among sellers, set by the previous year’s record-busting figures, was ebbing away.”