Investment advisers should insist that clients get appraisals of valuables updated periodically
Investment advisers routinely tell their clients to get proper appraisals of their art and other valuables.
But they should also insist that clients get those appraisals updated periodically, said Leslie Wright, vice president of trusts and estates at Bonhams & Butterfields Auctioneers, speaking at NAPFA's practice management and investments conference in New York on Thursday.
To illustrate her point, she tells the story of an affluent family who for many years used their pretty Ming Dynasty platter as a fruit dish.
“At Christmas, they used it to serve cracked crab, and they stored it under a counter,” Ms. Wright said.
When it was purchased decades earlier, the family knew the platter was valuable, but they had no idea that the value of Asian art has been “on fire” in recent years, Ms. Wright explained. “Especially if the work was not intended for export,” many Chinese investors are keen to bring such relics home and will bid up prices to get them.
The family had the platter reappraised and found that its value had soared to just over $1 million. Needless to say, they began taking much better care of it.
Asian art is not the only category of property that has changed value over the years, Ms. Wright said. Antique desks that sold for tens of thousands of dollars a few decades ago frequently sell for 10% or less of their former value, as buyers have lost interest in desks that cannot accommodate personal computers, she said. Antique cabinets that were popular as armoires a few decades ago have also plummeted in value.
Knowing the present value of those items can make a big difference to their owners or heirs, she said.
For example, when estates are being settled, sometimes heirs need to raise cash quickly, and “it can be easier to liquidate personal property” to raise money fast, she said.
