In times of financial crisis all markets need time to readjust, and that includes the art market. Market analysts sometimes refer to corrections in the market rather than using words like nosedive, tanking, or bottoming out. Market analysts are eternal optimists and they are also protecting their industry of financial investing.
Taking the Art Market Temperature
Financial analysts are saying that art auctions in November 2008 are not indicative of the health of the art market in general, in the face of the current worldwide economic crisis. It is generally deemed a bad time to sell fine art due the instability of the economy, many fear that the value will be artificially deflated.
Also, if fine art works are sold at less than their previous market value the value of that artists's stock or collectibility can decrease significantly for years to come. However, Nicholas Forrest, an art market analyst in Australia, says that there is a low correlation between the art auction market and the other parts of the art market. The simpler version, it's a good time to buy art. In the spirit of Monty Python, it's also a good time to haggle over the price of the art you buy.
Zhang Peng is Hot in New York
Miriam Kreinin Souccar of writing for Crain's New York Business is willing to use stronger words to describe the current state of the fine art market as the recent headline "Recession woes pop art market bubble" indicates. Ms. Souccacar reports that Eli Klein an art gallery owner in New York City is doing just fine and sold the majority of the artworks by contemporary Chinese artist Zhang Peng. (Interesting artists statement here)
Greek Art is Hot, Collections With Provenance are Hot
Meanwhile art auction house Bonham's in London reported sales that exceeded the estimates of some 19th-century Greek art and brought in 3.8 million pounds. In New York an art auction of a collection of African and Oceanic art brought in $10.9 million. Part of the value of this art collection was based on the fact that this artwork was from the era that inspired Pablo Picasso and Georges Braque to create Cubism and heralded the advent of Modern Art.
Big Art Auction House Losses
The art auction house Sotheby's lost more than $27 million on artworks that did not meet reserve minimums. Christie's is not willing to admit a loss, but did admit that they had 39 artworks that were estimated to sell for $100 million. Christie's sold only 27 artworks and only brought in $55.6 million. Isn't that a loss? Hmmm...stay tuned and in the meantime, hold onto your fine art paintings, drawings and prints. Now is not the time to sell, now is the time to buy artwork.
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