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Art was the best-performing luxury asset in 2022, with several blockbuster sales pushing average prices up 29%, according to the Knight Frank Wealth Report released on Wednesday.
Classic cars came in second with prices rising 25%, the largest increase in nine years. A Mercedes-Benz Uhlenhaut Coupé sold for US$143 million last year, becoming the most expensive car ever sold.
Half of the 10 luxury investment assets tracked by Knight Frank, which also include handbags, wine, coins, jewelry, furniture, colored diamonds, and rare whiskey, saw double-digit growth.
Overall, the Knight Frank Luxury Investment Index increased 16% year over year, easily beating inflation and outperforming the majority of mainstream investment classes, including equities and even gold, Knight Frank said.
The results “highlight just how important their collections are to ultra-high-net-worth individuals and how resilient many of these asset classes are to economic and geopolitical events,” Andrew Shirley, author of the Knight Frank Luxury Investment Index, said in the report.
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Whiskey was 2022’s weakest-performing luxury asset class with price growth of just 3%. Furniture and colored diamonds also had a low growth of 4%.
However, over a 10-year period, whiskey had the highest investment return, with prices increasing 373%. Classic cars and wine were the second and third best-performing asset classes, appreciating 185% and 162%, respectively.
Art prices rose 91% over the 10-year period. Last year’s performance was “driven by the stellar prices paid for museum quality works of art by ultra-wealthy collectors,” said Sebastian Duthy of Art Market Research, which provides the data for a number of asset classes in the Knight Frank index. “Several single owner collections produced totals in excess of US$2.5 billion, more than doubling collection sales in 2021.”
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This includes the late Microsoft co-founder Paul Allen’s art collection, which fetched US$1.5 billion at Christie’s in November. Also, a masterpiece by Andy Warhol, Shot Sage Blue Marilyn, sold for a record US$195 million at Christie’s last May. It was offered for sale from the collection of Swiss art dealers Thomas and Doris Ammann, and the buyer was American gallerist Larry Gagosian.
Collectible watches rose 18% in 2022, ranking third in terms of annual return. Sales from the three auction houses—Christie’s, Sotheby’s, and Phillips—totaled £475 million (US$570 million) in 2022, up 33% from a year ago. More than 40 watches sold for at least £1 million, 12 more than the previous year, according to Knight Frank.
Watches and wine tied for the best-performing luxury asset class in 2021, with prices rising 16% year over year, according to Knight Frank’s previous report.
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