An article in The Economist this week revisits the frequently noted boom in the art market, taking an extended perspective on the practices of private sales, institutional investment and consulting over the past thirty years. “People buy art when they’re confident about their future wealth,” says economist Clare McAndrew. (more…)
As Sotheby’s prepares a new round of auctions in the upcoming weeks, the company has announced a series of increases in its sales percentages. Buyers at upcoming auctions will now pay 25 percent on the first $200,000 of a work’s hammer price, 20 percent on the value between $200,000 and $3 million, and 12 percent on any amount remaining above $3 million, up from the previous upper threshold of $2 million. “This will improve Sotheby’s revenue, strengthen the company’s profit margins,” says current CEO Bill Ruprecht. (more…)
The New York Times notes the increased willingness by auction houses to guarantee sales on their highest price lots, a practice that had fallen out of practice since the financial crisis of 2008. But some critics note that the growing practice is actually a result of stiff competition and minuscule profit margins. “They are trying to fix eroding margins by getting more of the upside from the guarantee,” said Michael Plummer, a partner at Artvest.
A recent Financial Times article notes the continually shifting state of the contemporary art market, and the changes in gallery representation, points of sale, and dominant art buying countries that are currently shaking up the art world and in correlation, notes the skyrocketing rents felt by many galleries in hot art neighborhoods like New York’s Chelsea and Mayfair in London. (more…)
The New York Times notes an increased in interest in the art market this season from investors and speculators, leading to committed buyers for nearly half the works up for sale at both Sotheby’s and Christie’s. The article also notes an increasing trend in speculating on guaranteed sales, as collectors and investors promise the estimate in an attempt to either go home with the work or make sizable profits off fervent bidding. “It’s a win-win situation,” says Abdallah Chatila, a collector who is guaranteeing two works at Christie’s next week. “I really want both works, and if they sell for more than the guarantee it can also be very lucrative.” (more…)
The New York Times addresses the publication of Thomas Piketty’s critically-lauded book on capital accumulation and income inequality this week, questioning how the work, Capital in the Twenty-First Century, can be applied to the art world, where the vast increase in high-figure spending has priced many interested parties out from buying works “The art market has become an excuse for banking in public,” says dealer Ivor Braka. “People are displaying wealth in the most ostentatious way possible. It’s luxury goods shopping gone wild.” (more…)
The value of art exports exported from the United Kingdom has reached the highest level since the 2008 financial crash, the BBC reports. In a report by Sweet and Maxwell, exports were charted at £2 billion in 2012, an impressive number that defied a new law entitling artists and their heirs 4% of the resale price on any work. “Art experts and dealers were concerned that London’s position in the art world could suffer compared to New York or Hong Kong, which haven’t introduced any such levy on the resale of modern and contemporary art,” said editor Massimo Sterpi of Sweet & Maxwell. (more…)
