Purchasing Fine Stringed Instruments
In 2004 Orchestrated Investments, Inc. cited research conducted by Nobuyoshi Ozawa at the University of Cincinnati that estimated the market capitalization for rare stringed instruments (i.e. those made over 150 years ago by the top 270 makers) to be approximately $12.3 billion, and that 100% of this market turns over every thirty years. Of these, Violin Advisor LLC estimates that there are perhaps no more than 2000 extant violins, violas, and cellos made by the Amati, Stradivari, and Guarneri families. These instruments have been coveted by leading musicians and collectors for over two-hundred years, and there is increasing worldwide demand for them. In the twenty-first century, violins made in the late-nineteenth and early-twentieth centuries are also beginning to attract collectors and investors, particularly as they are contemporaneous with the music of the Romantic and Post-Romantic periods. In partricular, the so-called “modern” Italian violins are demonstrating a dramatic upswing (see Violin Price Histories). Some of the problems encountered in purchasing violins include the relatively high transaction costs of buying from dealers and at auction as well as relatively poor liquidity (in the traditional market, violins cannot be sold on a moment’s notice by making a phone call to one’s dealer—this process may take a year or more). At present, there are fewer than a dozen major dealers world-wide and only two or three experts who are independent of the trade. However, with the trend of ownership shifting from musicians to collectors and investors, the violin market is becoming more efficient.
Potential purchasers should also keep in mind that all violins made by a particular maker do not command the same price; for example, early and late period Stradivari violins sell for appreciably less than his “Golden Period” (ca. 1700-1720) instruments. Condition is another important factor (for example, a sound post crack or a replaced scroll will greatly diminish the value of an instrument), and skillful restoration may disguise flaws or underlying damage that may affect value. Because violin dealers and auction houses often do not reveal physical defects or the nature of repairs when selling an instrument, an evaluation by an independent expert is advised. Furthermore, some instruments sound and play better than others, so if the purchaser is not a musician, the instrument should be evaluated by a concert violinist.
Despite their delicate construction, violins are fairly robust and generally require very little upkeep. Insurance premiums issued by specialist firms are generally much lower on a per-dollar basis than for real estate, automobiles, and many other collectibles. (For example, a violin appraised at $375,000 can be insured today for approximately $1,200 per annum.) If violins are lent to players, they typically pay for insurance and basic upkeep (such as replacement of strings, seasonal tonal adjustments, etc). If placed in storage, violins do not deteriorate as is commonly believed, but they should be examined periodically by a conservator to check their condition. Special precautions can be taken to prevent damage if violins are stored in harsh climates. As investments, fine stringed instruments exhibit low correlation with stocks and bonds, gold, and real estate, making them ideal additions to diversified investment portfolios. Because of their portability, they can be readily transported to favorable markets for sale. The prudent collector or investor, particularly if he or she is not a musician or has little familiarity with violins, should seek outside professional advice before plunging into this market.
Read about the use of scientific testing to determine the authenticity of violins in "False Messiah?" published in Forbes.
What would you pay for this violin?
The "Messiah" has long been considered the finest and best preserved of Stradivari's violins, yet in 1999 Violin Advisor's Stewart Pollens examined this famous relic in the Ashmolean Museum and uncovered evidence disproving the provenance that ostensibly linked it to Stradivari's workshop. He also discovered that a critical inscription it bears is a forgery, and that the instrument exhibits a number of stylistic anomalies. Dendrochronology proved that the tree from which the top was made was not cut down until after Stradivari's death! Initially, these revelations created a furor within the violin market, though experts are now beginning to doubt its authenticity.