By Philip J. Kass | From the September-October 2021 issue of Strings magazine
A lot has appeared in the press about fine old violins serving as pure investment opportunities. While I remain extremely dubious about that prospect, it is not the investments of the super-rich that I wish to discuss here. Musicians of almost every stripe are not buying the sorts of instruments where this is a deciding factor. That doesn’t make them less costly, but it does change the sorts of economic decisions you must make.
Back in the day (the 1950s, to be exact), a member of the Philadelphia Orchestra could buy a good Guadagnini for $10,000 to $15,000 and do so on an interest-free loan from the Orchestra Association. Mind you, this was no small sum, as it would buy you a house in many sections of the city. However, as much as house values might have appreciated, they have hardly risen the way that Guad did—well over a million today, in most cases, and if it were from Turin, rather more. At the time, this was not seen as a financial investment but rather as a musical one: the orchestra got one more classic violin to burnish the Philly Sound and the musician got a glorious musical partner that would otherwise have been out of reach. No one ever expected the type of appreciation that we’ve seen.
Fast forward to today. The modern musician is facing a weakening work environment and an increasingly tight financial picture. While the biggest orchestras, such as Philadelphia, still pay well above the average working wage, far fewer do today than back then (at my last count, there were only 13). Meanwhile, the expenses of family and home (yes, they’ve gone up too) make the issues of cash flow more intricate. So, let’s talk about investing in that violin.
Over the past 40 years, violin prices have gone up a lot, but there’s a downside too: they pay no dividends, they’re not subject to the laws of compound interest, and their value can only be realized by a sale. The sale itself also raises a few questions: how long might it take, and how much of a transaction cost do you incur? In my experience, the costs of selling an instrument can easily run to 30% or more. When I was working at William Moennig & Son, I once asked our accountant to give me a figure for what we needed to earn just to cover our overhead, and the answer was 13% (and I can tell you that this was much lower than many other firms at that time). So remember, whoever sells that instrument for you will need to take a fair chunk out of the price just to cover their own expenses.
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An honest stockbroker will always point out that past performance is no guarantee of future performance, but we in the violin trade frequently sell the idea of perpetual appreciation. So far, the market has borne us out. But what sorts of instruments manage to exhibit such growth? In my experience, it’s those that we used to call “cream puffs”: top and definitive examples of a maker’s work, with a long provenance, respected documentation, and excellent physical condition. Unfortunately, there’s a lot out there that doesn’t match this description.
Musicians, meanwhile, are most concerned about the sound, which is both subjective and elusive, and often not the most notable quality of a cream puff. And here’s where it gets messy, because an instrument compromised in condition, originality, and documentation will often be the last sold, and for the lowest “distressed goods” price, which makes it hardly the type of investment on which the buyer was relying. And this doesn’t address the issues of instruments believed to be by a specific maker at the time of sale, but that time, new insights, research, and science eventually reveal to be something else entirely. All bets are off for those values.
These days, because of the old instrument prices, many musicians have turned to modern instruments. They make excellent purchases for a lot of reasons. First off, the modern maker’s approach to sound is current, that is, it matches the tonal expectations of modern musicians, as reflected in their training. So, a modern maker’s work is designed around your professional requirements. Secondly, a new instrument from a living maker is by definition in perfect condition, well-documented, and definitive. And, it will tend to be much less expensive—car-priced rather than house-priced. And, if you master your skills as a performer, no one in the audience would know the difference, or for that matter, really care at all. They came to hear you, not the fiddle.
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Spend what you can afford, comfortably, without mortgaging your life in perpetuity, and don’t put all your money into one investment.
But, this is also a market, and subject to certain market restrictions. The comparison to car prices is appropriate. I often used to say that the market for old instruments is between old and older, whereas the market for new instruments is between new and used. I’ve never known a maker who thought that their older instruments were better than their newer ones, and with good reason: they can and should be learning their craft and developing it to ever higher levels of quality. However, this means that your ten-year-old new violin will probably not sell for that maker’s current price, and most likely will sell for less than that. While some makers’ prices have grown at a faster clip, most makers’ prices have remained at reasonable and affordable levels, and certainly haven’t appreciated as quickly as some older makers’ works have. And those same restrictions on the sale of old instruments hold true for new ones as well.
Of course, there will be exceptions to all this. Demand is fickle, and can shoot up or down depending on outside influences. Some modern makers’ work faces a demand that cannot be met by their daily output, and so their works are more likely to resell at the top of the market. In the matter of older instruments, the market is small and illiquid; few of a given maker’s instruments sell in any given year. As a result, a chart of sales data looks less like a bar graph than it does a handful of mud tossed against a wall. An unexpectedly high sale price can trigger a rapid sense of appreciation, but more often that can be followed by a long plateau.
So, what advice can I offer? Spend what you can afford, comfortably, without mortgaging your life in perpetuity, and don’t put all your money into one investment. This is true in every aspect, and certainly true when it comes to instrument purchases. My old boss, Bill Moennig III, used to remind musicians that they can’t live in a violin. We knew players who did not follow this advice, whose lives revolved around the monthly mortgage, and who came to hate their instruments for the pressures they imposed. If you want to have a life beyond music, you need to budget for it, and that means dividing your resources among various competing needs.
If your leanings are towards an older instrument, then buy quality, even if it isn’t always the best sounding. Maybe the tonal shortcomings are because you haven’t been playing it for ten years. If you buy a new violin, enjoy it, play it with pleasure, and pay heed to any tax advantages that may accrue to you as a professional player. In either case, you will have good memories, and perhaps also a bankable asset, when all is said and done. In any event, if you haven’t gone into this with elevated expectations, there is a much better chance that you can be pleasantly surprised rather than sorely disappointed.
