Monday, January 13, 2025

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Antiques as an investment

Lovely to look at, delightful to hold.  If the value goes up, you’ll be rich when you’re old.

Monique Vanek

THE WORLD of investing is not just limited to shares, exchange-traded funds, unit trusts, bonds, the money market, and contracts for difference—there is a whole world of alternative investments.  These investments can either make or lose you money, but chances are they’ll be loads of fun.

Investing in antiques is similar to investing on the JSE—if you do your research well, you can make money.  If you don’t, you can get burnt.  But unlike with shares on the JSE, no capital gains tax is charged on antiques if you make a profit, since these are regarded as ‘personal’ assets.

Antiques also have a huge appreciation value, says Clyde Terry, owner of Melville-based antique shop Clyde on 4th.  They however need to be differentiated from collectables, adds Terry.  Antiques are items that are a hundred years and older, while collectables are things that fall into the 1920s, 1930s and 1970s.  However, these items are great investment pieces—and are still quite affordable.

Should you decide to get into antiques, here are a couple of tips on how to do it.

  • As with buying shares on the JSE, you should investigate your planned investment before choosing what to buy, says Terry.  “Find something you like, find a dealer that you can trust, that is reliable and will tell you whether there was restoration on the piece—that’s a very important decider on whether you get a return.”
  • Make sure that you get a receipt from the dealer, stating what you purchased as well as the condition of the item should you need back up at any time, says Terry.
  • Spend time and effort speaking to and visiting dealers.  Find a dealer that specialises in what you are interested in.
  • You should look for areas that you can buy in, such as Royal Doulton, South African Art, Georgian Afrikaner, and 1940 Afrikaans furniture, says Terry.  “If you go into these areas, you’ll be going into a wise area and you are going to do well financially.”
  • Unless you can get an excellent bargain, you should buy antiques for the long term, says both Terry and Jeremy Astfalck, from the Old Corkscrew.  “You should hold on to antiques for two to three years or longer.  Should you hold on for ten years, you’ll do incredibly well,” says Terry.
  • When choosing what to buy, look at the rarity factor.  The opportunity to buy such items is rare, so if you see something you like, buy it, because it might not happen again – such as paintings by Sydney Carter, says Terry.
  • Should you buy an antique such as glass or porcelain, you will need to look after it, says Astfalck.  Tea trays need to be cleaned, and porcelain should be (gently) dusted regularly.

As is the case with shares, you can get burnt, if you don’t buy from a reliable seller of antiques.  Faires like the National Antiques & Decorative Arts Faire are a good place to buy antiques.  Such faires are vetted to ensure that pieces of furniture are not married in any way.  What this means it that the furniture might have been assembled with two different parts of furniture, says Terry.

You should not buy something that has the word “style” without knowing what it means.  If someone should say the item is in the style of the 1930s, it probably means it is made today in the style of the 1930s, says Terry.

Don’t buy impulsively, know what you’re doing, says Astfalck.  You will make mistakes, but use them as an opportunity to learn, he suggests.  “Should you make a bad buy, you should trade them in for better stock or liquidate it through an auction.”

Astfalck suggests that you buy antiques that excite the trade.  The trade will tell you what’s good, what’s exciting.  “You have the best and the rest—the best is what everyone wants, the rest what nobody wants.  You can get an idea of this by walking through a faire seeing where people are flocking to, and looking at the price of various items.”

Monique Vanek is the Africa economics and government editor at Bloomberg LP.

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