Why Australians Aren’t Buying Art

Posted on: October 1st, 2019 by Pat Mesiti No Comments

If you asked me to paint a picture I would produce something not even a kindergarten teacher would stick on a wall. I have no talents when it comes to fine art – painting, drawing, sculpting, but I do believe that every day all of us should do something creative. It is essential to our mental health. Some people are good with words and write, some people sing, some people carve wood, some paint. If you are really creative you may choose to make a living from your talents. That is a good thing however, I was upset to learn this week that the Australian art market has flatlined – it has not gone up in years. I think valuing creativity speaks volumes about who we are as a people.

I found this information about the Aussie art market on The Conversation website. If you haven’t visited that site, I suggest you do. It only features articles written by experts in the field – I’m talking academics (doctors and professors), people who know their subjects inside out. The article I read was written by two Melbourne University art scholars, Dr David Challis and Dr Anita Archer.

Dr Challis and Dr Archer found that over the past decade the Australian art market has performed poorly. According to Australian Art Sales Digest, the combined art sales through Australian auction houses was $107 million in 2018. That figure has remained unchanged for the last ten years and is actually 10 percent lower than it was in 2007. Commercial art galleries, that sell new artists works, are attracting fewer customers. There are fewer art galleries in Australia than there were 10 years ago and there have been several new closures, such as the landmark Watters Gallery in Sydney.

Dr Challis and Dr Archer also found that artists’ incomes are falling. Lowensteins Arts Management, representing more than 4,000 Australian artists has calculated incomes for “established” visual artists fell by 15 per cent between 2010 and 2017, while incomes for “mid-career” artists fell by 4 percent over the same period.

Media commentators and industry operators believe the fall is caused by the global financial crisis. But Dr Challis and Dr Archer point out that the recently released The Art Basel and UBS Global Art Market Report 2019 shows that art sales in the United States (hardest hit by the global financial crisis) have increased by 38 percent in the past decade, and global art market sales are also up 9 percent in the past 10 years.

Australia did not even go into recession during the global financial crisis, so why aren’t we buying art and supporting our artists?

Why aren’t we buying art – Reason 1

Before 2011, Australians with self-managed superannuation funds were allowed to buy art and lease it to the funds’ members (ie wives), store the art in their home and insure it under their house and contents insurance. But the federal government was concerned that fund members might actually be tempted to display the art, so they prohibited Australians with self-managed superannuation funds from buying art with superannuation money. That really hurt our artists. Before the change, Australians with self-managed superannuation funds were behind between 15 to 25 per cent of all sales in the local art market.

So who are these people with self-managed superannuation funds? 75 percent of them are older than 50 years, and 60 percent of them have more than $500,000. Essentially they are older and rich. You might be wondering why I am today blogging about old, rich people. I’m not. I’m blogging about people with artistic talent. Kids who can draw horses that actually look like horses (my horses look like mutant camels). Will any of these kids be able to make a living from art in the future? At the moment it’s not looking good.

Older richer Australians used to buy a lot of art, until the government changed the super laws. I think it is time for politicians to rethink changes to laws around self-managed superannuation funds and also acknowledge how important art is. If the government allowed “investment grade artwork” bought by super money to be displayed in private homes art sales would soar. Sales growth in art would generate GST, income tax and reduce welfare payments to struggling artists. I want artists to have a future. Again, I believe in creativity.

Why aren’t we buying art – Reason 2

According to Dr Challis and Dr Archer, two years before the super rules were changed, the Resale Royalty Right for Visual Artists Act 2009 was passed in Federal parliament. Under the scheme all commercial sales of artwork valued above $1,000 are subject to a 5 percent resale royalty on the price, which is payable to the artist or their estate for 70 years after the artist’s death.

The law is meant to help artists when their art is resold. As of March 2019 the scheme has generated $7 million in royalties for more than 1,800 artists. The average payment has been $370 and 63 per cent of the artists receiving payments have been Aboriginal or Torres Straight Islanders. But the big question is, has this law discouraged people from buying art?

Dr Challis and Dr Archer say because it was introduced around the same time as the super changes, it is hard to know. In Europe they also give artists royalties on resales but they are capped. In Australia there is no cap – it is just 5 percent of the resale price. In Europe the cap is 12,500 euros (or 4 percent of the sale price, whichever is lower).

Why aren’t we buying art – Reason 3

Globally, fakes in the art market have discouraged people from buying art. International laws are not offering buyers enough protection. One way to protect buyers is to track ownership of an artwork, from the moment it is produced to its current owner. Dr Challis and Dr Archer suggest an open access database of artworks and owners for potential buyers.

Why aren’t we buying art – Reason 4

Is enough being done to promote great Australian art around the world? Australian art needs to be displayed next to the world’s best to drive interest and confidence with international collectors. Australia needs to raise its profile on the global arts scene. 

Dr Challis and Dr Archer say the recent exhibition of ten contemporary Australian Indigenous artists at the Gagosian Madison Avenue gallery in New York provides an example of how much collector and media attention can be gained through international exhibitions. Most of the paintings in this exhibition are owned by Hollywood actor Steve Martin, who acknowledged the potential for greater international demand once Australian Indigenous artwork is better understood and marketed in the company of other high profile contemporary artwork. The internet is enabling Australian artists to market their work around the world.

Have you ever bought an original piece of art? You don’t have to go crazy, but why not buy some art to mark a milestone birthday or wedding anniversary? Go to lots of exhibitions and art galleries first. Learn about the history of artists, learn about their inspirations. Go to openings and meet the artists. Finally choose something that makes you happy, but buy only what you can afford, and then take your art home and enjoy it!

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ABOUT PAT MESITI

Pat Mesiti is a best-selling author, coach and educator in the area of personal development. Having built some of Australia’s largest people-driven organisations, Pat understands the power of harnessing human potential. He has shared the stage with some of the world’s great business minds and has sold over millions of copies of his books and materials.

 

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