The Dual Meanings of Value and Appreciation
by Roger Gozdecki While browsing through some rare book catalogues recently, I came upon a listing for a set of Winston Churchill's six-volume series, The Second World War (the first British editions, 1948-1954) inscribed by Churchill to his personal valet, for $4,000. I couldn't resist the inescapable sense of irony that at the same time an unsigned "mint copy" first U.S. edition of J. K. Rowling's Harry Potter and The Sorcerer's Stone (1998) was advertised by another bookseller for the same price! If in ten or twenty years, someone reads this and remarks incredulously, "Harry, who?" it will only serve to underscore one of the principal points in this segment on rare book values. Passing public fancies are fickle phenomena. The price of scarce and rare books moves up and down in accordance with the unpredictable laws of supply and demand. Does this mean that contemporary western society ascribes more real value to Harry Potter than Winston Churchill? No, not likely. A more realistic interpretation is that interest in the quirky J. K. Rowling children's series about a plucky apprentice sorcerer has been whipped into a frenzy approaching the level of tulip mania in 17th-century Holland. It can also mean that prices for Harry Potter first editions have quickly leaped to a peak and are not likely to be sustained over the long run of c hanging literary tastes. There are many factors that influence the value of rare books and the public's demand for them. Every generation tends to collect its own emotional furniture, and consequently, first editions of the few great books that help to define an era generally become sought after as collectibles by the readers who first came to appreciate them. In fact, the rise of contemporary literature, and now so-called "hyper-modern" books (the emphasis is on "hype"), as objects of desire has probably been the most significant trend in book collecting during the past thirty years. Throughout the late 1980s, for example, copies of Stephen King's scarcest first editions, including Salem's Lot (1975), Night Shift (1978), and The Dark Tower: The Gunslinger (1982), were selling for more than your garden variety Charles Dickens first editions. Book prices can fluctuate dramatically from dealer to dealer, depending upon the expertise that individual booksellers bring to particular books. Specialists in any given field generally set the market for that kind of book, and since most of their inventory is purchased from booksellers who aren't as knowledgeable about the subject matter, collectors will generally see a doubling of prices when moving from the general bookseller to the specialist for most books. Consider the following true story, which illustrates one specialist's unique ability to capitalize upon his own knowledge and experience (the prices are real, but the names have been changed to protect the innocent): At a recent book fair, Dealer X, who specializes in cinema material, rushes over to Dealer Y's booth, in order to purchase a very rare first edition of a by-and-large forgotten 1940s novel that was adapted into a seminal film from the same era, only to learn that the book has already been sold to Dealer Z for $400. Not to be dissuaded, Dealer X buys the book from Dealer Z for $2,400 and sells it the next day for $8,000! | With so much potential variance in prices it's not surprising that novice collectors rely heavily upon price guides to determine fair market value for their purchases. Price guides are no substitute, however, for first-hand experience in the book market, and in the end, I would suggest that buying a book based solely upon the judgment of some price guide is about as efficacious as buying a home without knowing what comparable houses in the neighborhood have sold for recently. Know your book market! Many people frequently talk about the long-term appreciation of exceptionally rare books. In fact, a representative of one of the world's leading antiquarian book firms was quoted in the Los Angeles Times suggesting that particularly astute book collectors could expect annual returns of 15% if they bought "the right material." While it's true that the value of some books often increases dramatically in a very short time, it is also true that for most collectors—even the most knowledgeable—the old maxim that collectors buy at retail and then sell at wholesale still applies. Like any other collectible, books possess no intrinsic value. They aren't gold bricks! If the goal of your collection is to accrue double-digit investment yields, I recommend that you stick with some other financial instrument that's more liquid than rare books. Book collections are rarely as profitable as a well-managed stock portfolio, but they are a whole lot more interesting to read. At the end of the day, I recommend that everyone collect what makes him or her happy. In an increasingly homogenized world, rare books often furnish insights into ways of life and past experiences that most people can't even begin to imagine. Change occurs with such relentless speed in our world that modern life often appears to be aimed at denying our own individuality as human beings. Most book collectors discover that the real value of their collection lies in the deep personal satisfaction that it affords them. What matters most over time is that collectors own appreciation for their books is what continues to increase exponentially. |  | collecting strategies | | Starting your first book collection can be daunting, especially if your interests vary and you find all books appealing. Here are some strategies to consider as you decide on which path to take to a great collection. |
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