The prices of art saw the steepest annual decline among luxury investments, dropping by 18.3% in 2024, according to Knight Frank’s ‘The Wealth Report 2025’. The report, released by the global property consultant, revealed that only half of the top 10 passion investments recorded positive growth last year.
Among luxury assets, handbags emerged as the best-performing category, with prices rising 2.8%, followed by jewellery (2.3%), coins (2.1%), watches (1.7%), and classic cars (1.2%).
Collapse of art, wine, and whisky markets
Fine art experienced a sharp decline, reversing the double-digit growth seen in 2023. The fall was even worse than during the COVID-19 pandemic when art prices dropped by 17%.
Fine wine prices also tumbled, down by 9.1%, due to shifting consumption trends. Similarly, rare whisky suffered its second consecutive year of losses, declining by 9%. This decline follows a market peak in mid-2022, with values now 19.3% lower than that period.
Furniture from important designers also saw a dip of 2.8%, while coloured diamonds declined by 2.2%. Knight Frank’s Luxury Investment Index (KFLII) recorded an overall drop of 3.3% in 2024, marking the second consecutive year of negative growth. The report noted that scarcity alone is no longer a guarantee of value appreciation in the luxury collectables market.
Luxury investments
Despite the recent downturn, luxury assets have proven lucrative in the long run. Liam Bailey, Knight Frank’s global head of research, highlighted that a $1 million investment in 2005 tracking KFLII would now be worth $5.4 million. In comparison, the same amount invested in the S&P 500 would have grown to $5 million by the end of 2024.