What motivates art buyers – Motivations of HNWIs 2023

We recently presented you with a summary and key findings from the Art Basel UBS Art Market Report.

In the article “Global Art Market 2023/2024 – Outlook Fuels Hopes ”, we focus on the latest developments in the global art market for dealers, gallery owners and art collectors.

This significant economic analysis of the state of the market (see The Survey of Global Collecting 2023 ) also provided us with a sound forecast of future developments for the year 2024.

However, the report fell short in illuminating the motives and motivations behind the art purchases and purchase intentions of High Net Worth Individuals (HNWIs) – individuals with disposable household assets of over $1 million.

Here too, the Art Market Report valuable insights into the thoughts and feelings of wealthy art collectors.

The main reasons for buying art

When asked about the main reason for buying a work of art, factors related to one 's own identity and personal enjoyment considered most important (37%) .

Next came financial motives (28%) and in third place were relationships , including social contacts and networking activities related to collecting art and participating in the art market (14%) .

It is not surprising that most people buy artwork to express their own identity and personal enjoyment. After all, a well-chosen painting or sculpture transform the ambiance of a room and give its owner a sense of pride.

However, financial motives also play an important role for many collectors. A good investment in the form of a high-quality work of art can prove extremely profitable in the long run – provided, of course, one has a good nose for promising artists and works.

However, the relationships associated with art collecting should not be underestimated. Exchanging ideas with other collectors , as well as contact with gallery owners and auction houses, can provide valuable experience and reveal new perspectives.

Overall, this survey clearly shows that interest in art goes far beyond mere aesthetics . Rather, it reflects our individual preferences, but also our striving for higher social status and our desire for a meaningful leisure activity away from the stresses of everyday life.

Declined resale rate

Almost half (48%) of high net worth collectors had resold artworks after purchasing them, 38% of them in the period from 2022 to 2023.

Although only a small minority of about 10% described themselves as “investors” , many wealthy collectors were actively involved in trading their artworks.

Almost half (48%) of these collectors had already resold works, with 38% of sales taking place in 2022 and 2023. However, this was a significant decrease compared to 2020 (60%) and 2021 (49%).

Only 5% of collectors bought and sold their works within a year, while 39% stated that they kept their artworks for an average of up to three years before reselling them (compared to 30% the previous year).

The majority of collectors (83%) chose to resell their works within five years of purchase.

Financing the art purchases

A significant number (43%) of wealthy collectors had borrowed money to finance their art purchases. Of these, 30% did so in 2022 and 2023.

For those who used loans, the average proportion of the value of their collections financed by these loans was about 29%.

In comparison, the average among very wealthy collectors was higher at 39%, and a third of them had acquired more than half of their collections using borrowed capital. This contrasts sharply with only two percent of those with assets under five million US dollars.

Over half (54%) of all motivated art collectors had a financial background for their acquisitions and used loans or credit for this purpose (in contrast to only 39% without financial motives).

Joachim Rodriguez y Romero

Owner and Managing Director of Kunstplaza. Journalist, editor, and passionate blogger in the field of art, design, and creativity since 2011. Successful completion of a degree in web design as part of a university study (2008). Further development of creativity techniques through courses in free drawing, expressive painting, and theatre/acting. Profound knowledge of the art market through years of journalistic research and numerous collaborations with actors/institutions from art and culture.

www.kunstplaza.de