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Investment grade violin

Instruments: Can a good modern violin be considered an investment?

From James Dew
Posted December 10, 2007 at 06:52 AM

I want to upgrade myviolin and was told to buy investment quality. Now I read investment quality starts at #100k. WOW. I would appreiate additional thoughts. I would also appreciate your comments on the quality of instruments made by Vittorio Villa- modern day Cremona luthier. Thank you very much.

From James Dew
Posted on December 10, 2007 at 02:38 AM
My message was in English. I only know English.
From Pieter Viljoen
Posted on December 10, 2007 at 07:19 AM
Every violin is an investment. Only some are good ones. Whoever told you that 100k is the minimum didn't give you good advice.

Firstly, modern italians, almost all of which are less than 100k, represent probably the best investment besides the really high end stuff.

Unfortunately I wouldn't look to Cremona if I were buying modern. There's like 800 makers now in that tiny little place, but it hasn't really proven to be as effective as the United States, UK, France, and Germany in terms of modern violin making. Go to the "news" section of this site, and go to December 3rd, or some date like that. Read the article that was posted on the value of violins over time. It reinforces everything I've said for a while now.

Get an instrument you enjoy playing. For everything else, start reading the business section.

From David Burgess
Posted on December 10, 2007 at 01:30 PM
A lot depends on your investment perspective. The greatest monetary gain might come from buying a very cheap violin (even cheap enough to depreciate) and putting the balance into more conventional investments.

Another perspective suggests that if one buys wisely, one can at least have free use of a very expensive violin, and probably make some money on top of that.

So much depends on the details though. If you take out a loan to buy the violin and pay interest, or own it for a short period of time and pay a commission to sell, things like these can eat up any potential profits. Also factor in the cost of insurance.

HERE'S A LINK to the article Pieter mentioned.

By the way, the term "modern Italian" in the article probably doesn't mean "contemporary Italian", but somewhat older instruments. I believe one of the authors, Philip Margolis posts here, so maybe he can clarify.

David Burgess
burgessviolins.com

From Pieter Viljoen
Posted on December 10, 2007 at 05:52 PM
Yea it probably means instruments ending around the 70s.
From James Dew
Posted on December 10, 2007 at 09:04 PM
Dear Pieter and David,
Thank you! I am most grateful for your thoughts.
1. I meant contemporary, not "Modern Italian" violin. Poor choice of words.
2. I only mentioned "investment" because a friend/dealer suggested that. I mostly want a good violin that's fun to play and when I pass on it would be a plus for heirs.
3. I asked about Vittorio Villa because his instruments are played in some confisticated halls in Europe and the US.
Thanking you in advance. James Dew
From Jeffrey Holmes
Posted on December 11, 2007 at 05:48 AM
I don't really disagree with anything that's been mentioned so far... although I do have some questions about the data in the article being sited. If I'm not mistaken, it seems that the sales used to produce the report were from public sales (auctions). Thing is, instruments that are sold repeatedly in the auction venue may not always represent the heart of market (retail, or private sales) in an accurate way... although I have no doubt they do represent the general trends. Many instruments never, or rarely, return to the auction houses once they've entered the retail market.

One factor required to translate the actual appreciation levels is to understand what, on average, is the sale value at auction vs. the retail sale value of specific makers, or groups of makers. For example, Sartory bows sell very well at auction, often near 90% of what one might expect to pay in a retail shop. While a popular maker before that time, auction sales at that level really began in the late 80s/early 90s. Other makers, from the same period and nearly the same quality, may only sell for 70% or less.

Just my 2cents.

From Kristian Rahbek Knudsen
Posted on December 10, 2007 at 11:01 PM
Interestingly the trend in the London sales at the moment seems to be that private buyers are prepared to pay more for poor condition instruments in the sales than what better examples would cost at dealerships
From Pieter Viljoen
Posted on December 10, 2007 at 11:44 PM
Jeff,

I e-mailed the author and tried to get a reply. If it's the case that they're all auction numbers, then the numbers will definately be soft. Retail is where the real $$$ is at as far as I know, however I e-mailed a friend of mine who might know and he had heard from someone that they were in fact recording documented private sales.

I do know that there is a recent documentf floating around that was commissioned by one of the major investment firms specifically on this topic. These sorts of things are done often with a variety of commodities and given the wealth of the clientel, it wouldn't suprise me if they really did their homework. I'm told it's quite comphrehensive, but I have no way to really get a hold of it. All I know is that in general, high net worth individuals aren't generally being advised to buy violins over other types of antiques or investments.

So with regards to your question; if your heart is really set on that instrument, I hope you get a good price. With makers like Kelvin Scott and a few others under $15,000, I see no real reason to cross an ocean to get a violin when you can buy something pretty top class in Tennessee.

From Jeffrey Holmes
Posted on December 11, 2007 at 05:54 AM
Hi Pieter;

I think your friend may be mistaken. The following is a published abstract of Kathryn Graddy & Philip Margolis' paper.

"This paper measures the returns to investing in violins using two different datasets. One dataset includes 75 observations on repeat sales of the same violins at auction starting in the mid-19th century and another dataset includes over 2000 observations on individual violin sales at auction since 1980."

Philip's paper may paint a picture that I believe is off on a point or two (especially if you consider retail sales; which I think you really need to in order to present a complete investment picture), however it seems relatively accurate when it comes to pure auction sales... and gives a good general overview of the returns in that part of the market.

Frankly, while there are a number of us who are pretty well versed in the retail numbers (if you appraise, you have to be), I think it would be difficult to publish a paper that showed a complete and accurate view of dealer/private sales. Many buyers and/or sellers would not be excited about making those figures "public" across the board.

Don't get me wrong, though... I'm not saying that violins are a better, or even an appropriate, choice of investment for high-income speculators.

I think buying an instrument, for a musician, is primarily an investment in their career. Buying one that appreciates (not all of them do, however) does have some advantages for working musicians, depending on how you handle your taxes (appreciation isn't taxed until you sell the item, for example... and there are other advantages).

Jeffrey

From Pieter Viljoen
Posted on December 11, 2007 at 05:47 AM
Jeff, as I said before, it's totally possible it's wrong, which is why I e-mailed to ask.

As you said, without retail numbers, you're getting only a tiny bit of the picture. That's why I'd like to get my hands on this other industry report I've heard of.

At the end of the day, your business is definately in no danger. No matter what any of these reports say, these instruments are a joy to own, and the market for them will always be there. When I do have more money one day, I will be buying old instruments and bows.

From LUIS CLAUDIO MANFIO
Posted on December 11, 2007 at 10:30 AM
In a recent "viola trip" to NY, all the top players (Julliard teachers and NYP players) I met were playing contemporary violas, even those who owned old Italian instruments.
From Kristian Rahbek Knudsen
Posted on December 11, 2007 at 02:05 PM
Manfio, I think it has a lot to do with comfort. Most old violas are either too small ie. comfortable but not sounding as desired or too big ie. good sounding but uncomfortable.
The best modern makers can produce fantastic compromises between sound and comfort.
Violas are a bit special in that respect. With violins you dont see the same thing.
From Peter Carter
Posted on December 11, 2007 at 03:16 PM
Don't forget that one can also write off 100% of the interest with any instrument loan along with the annual insurance fee.Im writing this as a professional musician,not a high income speculator.
Of course a musician can set up a capital cost schedule of depreciation for each tax year although sometimes its good to stop depreciating it and not pay so much on the capital gains when its time to sell the instrument.
From LUIS CLAUDIO MANFIO
Posted on December 11, 2007 at 04:50 PM
Hi Kristian! Yes, the number of old violas is small... many of the big old ones were reduced drastically in size and are too small for modern standarts, some were made too small (most of modern Italian violas are too small), so that viola players are almost obliged to reccur to contemporary instruments.

I posted some pics of my "NY VIOLA TRIP" here:

http://www.maestronet.com/forums/messageview.cfm?catid=4&threadid=316989&enterthread=y


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