“auction houses”

Less and less auction pieces?

After a decade in which sales records have emerged one after the other, auction houses are struggling to find new masterpieces or to sell them well. It’s an increasingly common observation: big auction sales are not reaping the same profits as before. It’s no longer rare to see lots going below starting estimations or else just over them. For example, at the Sotheby’s “Impressionist, Modern and Surrealist art” sale on 3 February featuring two exceptional works by Picasso and Matisse, both works sold for below their estimations. The same tendency has been seen at Christie’s, with almost one quarter of its lots unsold at one of its key sales events. Commentators foresee the end of the golden decade. A first explanation for the phenomenon is the slowdown in the world economy, especially on emerging markets such as China and Russia, that buoyed up the market in recent years. But the problem is perhaps also due to the nature of the activity itself and the economic model of auction houses. Shortage affects not only demand but also offers, whereas seller guarantees are high and can cost a great deal to auction houses — although new strategies are being set up such as third-party...

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Auction Houses Adapt to Serve the Next Generation

Sotheby’s, Christie’s and other auctions houses are adapting to serve the next generation. Auctions today are facing up to the fact that while the older audiences have traditionally supported them are still vital, their survival hinges on looking to the next generation. “It’s absolutely critical, essential,” said Jussi Pylkkanen, Christie’s global president and principal auctioneer. “The next generation of artists and buyers and people who are inspired by, and interested in, the art world is absolutely critical to us. With interests as diverse as their upbringings and culture, these young collectors are changing the way auction seasons are shaped. Unlike their predecessors, they often do not come from families that collected art, or even possess more than a surface understanding of the art world. They may discover a painting through social media and spend thousands, perhaps even millions, on an item without having ever set foot in an auction house.” The ability to view lots, watch videos, download condition reports and bid online has helped to break down real and perceived barriers to auction houses. For Phillips, approachability has meant rebranding: shrinking catalogs and emphasizing essays in the hope of creating a more magazine-like experience; making advertisements more colorful and using accessible language. Overcoming a stuffy, exclusive image is a concern across the board. Over the past two and a half years, bidders have come to Christie’s sales site from 90 countries, and 44 percent of all new bidders have been under the age of 45. Items in online sales at Christie’s and other houses have fetched seven figures. This is why so much of the auction world is focusing on social media and online tools like apps and videos, as well as working with e-commerce sites like eBay and...

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The overall volume of recent works has decreased by 23% in H1 2015

The overall volume of works that are less than three years old being sold has decreased by 23% this year. While three of the major auction houses are preparing for mid-season emerging art sales in late September, New York Times columnist Scott Reyburn determined that these auctions will be a test for the market. In February 2014, a “Rain” painting by Lucien Smith, which was created in 2012, was sold at an auction held in London for £224,500, about $372,000, nearly 30 times it original estimated price. In May 2015, another painting from the “Rain” series created in the same year, with the same dimensions as the one sold in 2014, sold at Phillips in New York at $62,500. According to London-based collector, art dealer and writer Kenny Schachter, “People with foresight have stopped buying this kind of art…Artists in their 20s just shouldn’t be selling for almost $400,000.” Artnet has shown that contemporary works created within the preceding three years amassed $217.4 million in auction sales in the first half of 2014. Sales of these works slumped to 23% during the equivalent period this...

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The 90s Crisis and Its Consequences

Alfred Marshall stated in his book Principles of Economics, “It is impossible to evaluate objects such as master paintings […] since they are unique in their genre, having neither equivalent or competitor.” Art has always been an ambiguous subject of study for economists due to its atypical characteristics. Works of art have an increasingly marginal utility (in which perceived satisfaction increases with consumption, which is not the case for other types of goods) and a strong degree of uncertainty in its value. One of the necessary elements to comprehend the art market crisis of the 1990s is that it revealed a change of view of art: art is no longer considered an independent field within the economy but as a sector of potential investment. The 1980s: a favorable macroeconomic environment for speculation The art market began to globalise after World War II. The United States became an important player, and prices began to increase. However, it was following the 1980s that the prices saw a significant increase. During this time, the financial markets profited greatly from cash-flow and the economy witnessed a period of growth after the post-oil shock recession. Now there is a link between the growth of the economy and the art market: an increase in GDP invites investors to place their funds in the art market with the purpose of diversifying their portfolios or out of pure artistic interest. Additionally, Japanese investors began to participate in the art market as buyers, favored by a strong yen and a flourishing economy. The amount of artistic imports to Japan during this time rose to nearly 20 billion francs, around €3 billion. Finally, it was during the 1980s that businesses began to collect artwork: which was the case for IBM and Philip Morris, for example. These elements created a strong demand in the art market, with...

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Christie’s and Sotheby’s Post-War and Contemporary sales fetch total £240 million

More than £240 million was made in sales by Christie’s and Sotheby’s over the past month in their Post-War and Contemporary auctions. ArtNEWS reported, using data from Skate’s, the half of this £240 million was fetched by the work of just three artists; Gerhard Richter, Cy Twombly, and Francis Bacon. The other half was fetched by the work of 60 artists, demonstrating the huge discrepancy between prices. Richter alone created 26% of the total, compared to Twombly’s 13.9% and Bacon’s 10%. Other important artists included: Yves Klein, with 6.8%; Lucio Fontana, with 6.6%; Andy Warhol, with 4.5%; and Jean-Michel Basquiat with 4.4%. The highest selling piece of the period was, naturally, a Richter piece which sold for £30.4 million at...

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