Patience first
Posted by Bob Brooke on 10/06/2017
When looking at the antiques and collectibles markets today, perhaps it’s appropriate to paraphrase the name of one of the recent urgent-care centers, Patient First, by saying “patience first”—because that’s what it takes to play the antiques game.
Patience First
by Bob Brooke
When looking at the antiques and collectibles markets today, perhaps it’s appropriate to paraphrase the name of one of the recent urgent-care centers, Patient First, by saying “patience first”—because that’s what it takes to play the antiques game.
As a player, you’ll be on one of two sides. On one side are the antiques investors and on the other side the antique collectors. There’s a big difference in the two sides. So pick a side and let’s play the game.
To begin, both players begin with the same amount of money and must purchase the same group of antiques from their local antiques dealers. Let’s say the group includes a Chippendale desk, a Victorian gateleg table, a Wedgewood plate, a Mission rocker, and a peachblow art glass vase. The object of the game is to see who will end up with the most value for their antiques.
But before we continue playing the game, we need to understand the difference between investing and collecting. A person who purchases antiques as an investment usually has nothing more “invested” in them but money. Often a third party does the actual buying. The only thing the investor does is pay for the item and have a place to store or display it. But the collector invests a lot more, including not only his or her money, but their time and passion for collecting. And while the investor has the final say as to whether he or she wishes to add an item to their collection, the collector is directly involved not only in the decision to purchase an antique but also in every other facet of the collecting process.
As the game progresses, the market takes a dip, much as it has done today. The investor gets nervous and tries to sell his Chippendale desk. But he finds out he can only get half what he paid for it. That means he’ll lose money on the transaction. So he tries to sell his Mission rocker and discovers that he can get at least what he paid for it. So he decides to sell it. With the money he receives for the rocker, he can either buy another piece of furniture or something else. He rushes out and buys a Lincoln sofa from the 1860s. But he doesn’t have enough money from his sale of the rocker and must add a bit more.
Meanwhile, the collector is enjoying her original purchases and takes very good care of them, for condition is all important in the antiques trade.
Eventually, the antiques market regains some of its strength, so the collector decides to trade up. She takes her peachblow art glass vase and trades it in on a stained glass lamp to place on a table next to her Mission rocker. While she gains no money, she does gain light for someone sitting in her rocker.
With the market up, the investor decides it might be time to sell his Victorian gateleg table. This time, he gets more than he paid for this item. But the extra money isn’t enough to buy another item.
The game continues, but it’s obvious that the collector has something the investor doesn’t—patience. In the antiques game, it pays to be patient first. In order for the investor to receive a modest return on his investment, he needs to wait at least 10 years to sell what he has. And as with the stock market, which goes up and down daily, so does the antiques market.
Lots of things affect the antiques and collectibles markets. Number one is supply and demand. The more there are of an item, the lower the price and the less value it will have. If an item is one-of-a-kind, it, too, can have a lower value. But it’s only when two or more people want the same item that it’s value increases quickly.
Again, the collector is satisfied to enjoy his antiques and isn’t so anxious to sell them. She keeps them for a number of years, trading some of them for better pieces to enhance her collection. In the end, she’ll end up with more value because she was patient. The antiques she purchased at the beginning of the game weren’t just old things. They had a previous life and brought joy into someone else’s life before she acquired them. Now she’s the temporary owner in hopefully a long line of owners. When she does try to sell them, she’ll know exactly who wants them and will get at least what she paid for them, if not a lot more.
So by practicing “patience first” it’s possible to outsmart the antiques market. But to do that successfully, a collector needs to be aware of the entire collecting process.