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The art market is awash with auction records. Classic cars are changing hands for millions of dollars. But the market for antique furniture, another popular alternative asset for the super-rich, has proved a terrible financial investment in recent years.
Figures from Art Market Research Developments reveal that the value of high-end antique furniture dropped by 9 per cent in the year to the end of 2014 and plummeted 28 per cent over the past decade. By comparison, no other asset on the index has depreciated: art was up by 10 per cent over the same year and classic cars by 16 per cent.
Yet collectors need to look more closely, as the drop is far from uniform. The figures reveal a change in tastes — and the old world has fallen decidedly out of fashion.
English pieces from the Regency period and the 18th century are worth 30 per cent less than 10 years ago and French 18th-century furniture has halved in value over the same period. Worst of all, the most recent figures from the Antique Collectors’ Club reveal Victorian and Edwardian furniture have lost more than two-thirds of their value since 2003.
Why? New tastes are emerging. In the past year, there has been a rise of 2 per cent in the value of early and mid-20th-century furniture.
“Individual designers still perform very strongly,” says Andrew Shirley, editor of the Knight Frank Wealth Report. “But what some people call the ‘brown furniture’ . . . doesn’t really fit into the design aesthetic of the current times.
“People want the ‘Scandi’ style, a cleaner style. A lot of very wealthy people want lateral, apartment-type living. And a lot of old furniture is very big [and] you might not get those Regency pieces up the stairs in Mayfair.”
Size matters. London’s prime real estate is now worth more than £3,800 per square foot. At that price, every bit of space counts (£26 per square inch, to be precise) and it becomes less and less feasible to waste it on a mahogany monster — whatever its provenance.
“There are demands on floor space today,” says Natalia Miyar, design director of Helen Green Design, an interior decorating business. “Often, spaces have to be multi-functional, meaning the demand for traditional, single-use pieces has decreased.”
Yet while demand for the old is falling, collectors are increasingly looking towards the new. A new furniture sale record was set in April. Marc Newson’s modernist “Lockheed Lounge”, a forbidding, aluminium objet d’art rather than a functioning sofa, sold at Phillips for £2.4m.
Interior decorators have “decreed everything should be minimalist and white”, adds Patrick Sandberg with a note of stoicism, having seen tastes ebb and flow over his lifelong career as a dealer of Georgian furniture in the heart of the antiques market on Kensington Church Street.
“People are actually getting rather bored of that now,” he adds.
There is still a market for opulent inlays and towering armoires in today’s homes, but it has shrunk. “Even when houses are decorated in this bald, beige way, they will buy antiques — maybe one or two signature pieces,” says Sandberg. “And, for better or worse, we find ourselves selling via interior decorators because some clients feel more comfortable (because they don’t know what they’re doing) with a decorator (who probably doesn’t know what they’re doing either).”
The changing face of London’s wealthy may have also had an impact. Cash-rich Londoners from the Middle East and Asia are less interested in traditional décor. Sandberg’s customers remain mainly English and American (and even the latter became less enthusiastic “when they stopped coming over after 9/11”).
“We get the Saudis in and we get the Chinese in,” he explains, “but the Chinese still don’t understand good Georgian furniture. That’s the way it is. I have done business with several Al Thanis [Qatar’s ruling family], too. They’re very charming and they do understand it, but they would be looking for more Victorian, gilt-mounted, inlaid stuff. I will have a really good 18th-century bookshelf . . . but they like a bit of flash.
“We’re a traditional shop and we stick to our guns and make a living.”
Like all luxury investments, antique collecting tends to be motivated by passion, which accounts for its enduring appeal, but in an increasingly competitive world, even passions can be tempered. And while personal pleasure may still be behind the majority of purchases, 32 per cent of the growing number of wealthy Asian investors consider capital growth almost equally important, according to a Knight Frank survey.
But with the market suffering, it is the best time to buy antique furniture for 20 years. And, Sandberg says, the price curve may already be bottoming out as people recognise the potential investment.
“At the moment I see green shoots,” he says. “We do consistently sell to new clients who are English. But I’m not saying we’re back to the great days.”
Miyar shares Sandberg’s optimism. “Currently the trend is for mid-century furniture,” she says. “But there will undoubtedly be resurgence in the popularity of Regency and Georgian — if only for the high-quality pieces. These will maintain their value.”