Investors in collectibles and “investments of passion” have been buying jewellery rather than classic cars recently, according to the researchers at Knight Frank, who have just published the latest edition of their Luxury Investment Index.
But it was wine, up 25%, that was the top performer in the 12 months to the end of June, “thanks to strong growth in the key Bordeaux, Burgundy and northern Italian markets”, the KFLII researchers said.
No other asset class achieved double-digit growth across the 12-month period, they noted.
The Knight Frank index tracks the price growth of ten luxury investment sectors (see chart, below), and has been monitoring the market for a decade.
Overall, the value of the KFLII index has risen by 5% over the 12 months to the end of June, “outperforming other safe-haven asset classes like gold and prime London residential property”, the KFLII researchers noted in a summary of their findings.
‘Time of change’
That said, though, it is “a time of change” in the world of luxury investing, they continued.
“Classic cars, which have dominated the rankings for the past few years, have now slipped back into sixth place on an annual basis, with average prices rising by just 2% [in the year to the end of June].
“Wine…has now claimed top spot with the year-on-year value of the Knight Frank Fine Wine Icons Index shooting up 25%.”
Classic car aficionados will be relieved – and possibly not surprised – to hear that collectible automobiles are still popular with many HNW investors.
According to Knight Frank, “nine cars broke the US$5m barrier at the recent benchmark sales in Monterey, California, with Bonhams setting a record for a Mclaren F1 (US$15.6m) and RM Sotheby’s
historic Aston Martin DBR1 going under the hammer for an eye-watering $22.5m.”
As for jewellery, an 18.04 carat stone known as the “Rockefeller” emerald” set “a new world record per carat for the green
gem (US$305,000) when it went under the hammer for $5.5m [at] Christie’s in New York”, while a 59.6 carat “fancy vivid pink diamond” known as “the Pink Star” set a new record for “most expensive piece of jewellery” when it sold for US$71.2m in Hong Kong in April.
To see the latest Knight Frank Luxury Investment Index report on the Knight Frank website, click here.