A recent survey of 360 high net worth individuals (HNWIs) by UBS and ArtBasel revealed that millennials are emerging as keen investors in art. According to the same survey, 17% of respondents investing over USD 1 million were millennials and 99% of millennial respondents said they were liaising with galleries.
Christl Novakovic, head of wealth management for Europe at UBS, said: “Digital platforms can increase price transparency and broaden the base of new buyers at different price levels. Strengthening this digital community globally may be essential for the health of the market in the future.”
On the surface this makes sense, millennials are accustomed to making significant purchases online, the older ones are reaching 40 and some are beginning to accumulate wealth.
In practice, most millennials have limited wealth and often view art as a consumer product for decoration rather than an investment. The owner of a London gallery explains, “Millennials do not collect art, it is a generation with less wealth than our parents. Those who see art as an investment have a family history in art, it is rare that we see a Latin American with that level of wealth.”
“Millennials do not collect art, it is a generation with less wealth than our parents.”
Owner, London gallery
So Latin American millennials aren’t trading Van Gogh’s but that doesn’t mean they are not keen investors in art. What about more modest investments? A Lima-based curator describes her view of the market, “There is a noticeable growth in interest from this generation, especially around emerging artists who are more relatable and accessible. These new buyers are not just interested in aesthetics, they want to get to know the artists and their life and they want diversity.”
The trend towards lower value pieces found through digital platforms is widely observed, for example, a gallery owner in Peru tells us, “Yes, we have sold more during the pandemic as people want to refresh their houses during lockdowns but the average sale price has dropped. Digital platforms help to build awareness but sales are still directly managed by the galleries.”
“The galleries have expanded their audience through social media and this is bringing a new type of buyer.”
The organiser of ARTLima believes that growing interest from millennials is also being driven by galleries changing their behaviour. “The galleries have expanded their audience through social media and this is bringing a new type of buyer.”
It will be interesting to see if galleries can establish a high-volume, low-value business for this new generation of buyers alongside their traditional high-value, low-volume model.