07Feb Don't Believe the Hype - Collecting New Books
In the words of Public Enemy, Don't Believe the Hype. Well, that's a little disingenuous to be honest. Chuck D should've really said 'Don't always believe the hype', or 'Exercise caution when making a decision based upon what others, both with and without vested interests, suggest. Admittedly, I'm not quite as good a lyricist, or indeed rapper, as Flav or Chuck (I blame the Yorkshire accent) but, I'm sure none of the team (correct collective noun for rappers; take my word for it) know their way around a bookcase like me.
Kind of lost track of what the point of this piece is. Ah yes, hype.
Now, let me state emphatically, that this article is just for people who have their collection's monetary value in the back of their mind - not those collecting simply for the joy of it.
The rare book market can be seen as two separate, but related, markets: the first being the established market, the second being the new market (c.f. hyper-modern). The established market comprises the majority of rare books. This market has dozens of price points over many years, a good estimate of variance through condition and established bibliographic information either in published form or within the trade. The new market may have a greater density of price points, but it is always over a shorter period of time, condition is usually more polarised and bibliographic material is more changeable. The other difference is that the majority of the established trade operates through the secondary market, whereas the new trade often operates with new books, or nearly-new books. Of course, this is a generalisation and there's a large intersection between the two markets.
The new market is in many ways a buffer to the established market; finding books for collectors that have little precedent that may in the future become part of the established market. The problem with the new market is that the longevity or durability of the books is, on average much, much lower. The important aspect here is the term 'on average'. To elaborate, say you bought ten books, brand new, each signed by the author. You pay £50 for each book, because a dealer has taken the time to get the books signed, or made the publishing contacts, or driven around every Waterstone's in the area buying all the copies. You have £500 worth of books on your shelf. You take a look online for comparable copies of each and find the average total is £300-£600. Fine. The same should hold true if you go to a book fair and spend £500 on a bunch of books from 1940. The distinction comes ten years down the road when you do another quick appraisal. That £500 will likely be different for both sets, but the variability will be much larger with the new books.
Books across the entire market are subject to trends, but with newly published books (i.e. in the decade or two), the trends vary much more widely. This is where the hype comes in, and there are two factors in play: firstly, the early investment and secondly, the new attention. The early investment factor is the same as any investment; if you get in early, you get in cheap. This appears obvious, but with rare books when you break it down, it's a facade. Say you decided to spend £200 on a first edition of Swan Song (1989) by Robert McCammon, you can be quite confident that in ten years time it's not going to have halved to £100. The chances are it'll have increased (I would be speculating to say by how much, but we'll cover that later). If you spend £50 on a copy of a book published just last week, that's already proving rare, then the chances are that the book will be worth perhaps £5 in ten years time. Of course, there are plenty of books to buck the trend. Take The Name of the Wind, for example, published in 2008 and worth close to £1000 in fine condition. If you bought that in 2009 even after it had been through a couple of sellers, you might've paid £100-£200. Similarly, there are plenty of books in the established market that have dropped to nothing, but the salient fact is that books in the established market are much less likely to be subject to large swings in value. You might like to take the rough with the smooth and hope that the £100 purchase turns to £500 over the next decade, and that's fine, if you like the gamble, but on average and without diligent consideration, the losses will significantly outweigh the wins.
The second factor is the new attention, this revolves around the fact that people are talking about the book - publishers, marketers, collectors, dealers, newspapers - something that is realised in selling prices. Most have a vested interest in a particular book becoming desirable. Collectors take an interest in a newly published book, often by an author without much history, and think they'll spend £30 to get a nice copy: everyone else thinks it's great, so I might as well buy one. Of course, the price then starts to climb at rapid rate until it plateaus and stagnates. At this point, either the market runs out of supply and the book becomes near unattainable, or a handful of copies sit there at high prices with any subsequent copies tending to be priced higher or around the same price. The most interesting effect here is the mad scrabbling coming from the group mentality that offers a bit of a security over the price; if collectors (and dealers) see books selling they will feel that a market value has been established or is increasing.
The problem with this is that often the collector hasn't read the book or perhaps less cynically, hasn't really assessed the longevity of the title. Often, the collector is blinded by the 'newness' of the book, in the same way a new film can often appear more enjoyable than a classic (that is until it doesn't become a classic ten years later, and seems relatively stale). Take a book like The Martian by Andy Weir. It's a good book, fast-paced, some fun science and they made a film of it. The question is, will it still be a good book in a decade, and if not, will people still want it? Film and TV adaptations, and even award nominations and wins, aren't sure-fire ways to success as they often serve a different purpose to establishing the book as a 'classic'. The collector in the new market is therefore presented with numerous new, and constantly refreshing, choices of where to spend their money. The hype, whether organic or forced, serves to add an urgency to an otherwise slow trade. The outcome being frequent poor choices.
The problem comes when the collector is looking to downsize their collection, or sell it completely. Most of the books won't have transitioned into the established market, and most never will. Worse still, the chances are that the supply of those books has gone back up because other collectors have thought the same, and the demand has stagnated. Now, there is a certain pleasure to be taken from seeing the value of a book climb at a rate faster than the established trade, and that's part of the fun of collecting - a retrospective bargain. I'm not advising against that aspect - I do that with my own collection - the idea is about how to mitigate the risk.
The risk can be mitigated by firstly making the right choices and secondly spreading your purchases across the two markets. Making those choices only comes with experience; either from one's own collecting experience or from working with a dealer. You already know what you want to collect, what I'm advising it what not to collect; stuff you or your dealer know nothing about.
So do established books always go up? No, far from it, many titles have dropped in the last decade, either across an author's oeuvre or just a majority of titles. It's such a defined market that one collector can buck the trend. It's not unfathomable to suggest that certain books only have one collector out there with the means and desire - it's usually more, but the higher up in value the narrower the market. The difference is that you can plot the course of a book in the established market and you can be more confident that it'll remain collectable given that it has done so for fifty years. But again, it's just a degree of confidence; there's no certainty.
Let me reiterate too that if you're buying most of your books new because most of the authors you enjoy are still publishing, or you trust a publisher to provide you with a certain level of quality, then you're doing the right thing as a collector. This is purely just about financial considerations - if you're collecting good books, then the chances are others will agree with your choices.