Art World Update

July 3, 2008 in The “Art World” | Tags: art, art prices, art world, Globe and Mail, Mike Collett-White |

There are enough “recession-proof,” super-rich buyers to push soaring prices for the best works of art still higher, experts predict, but the picture is less rosy at the lower end of the market.

And in a world where perception is everything, values for even the world’s most sought-after artists could come back down to Earth with a bump if confidence were to slide.

Christie’s and Sotheby’s, the world’s two top auctioneers, have just completed a series of summer sales in London that raised more than $1-billion, underlining how resilient the top end of the market is despite growing economic gloom.

Records tumbled and bidding was aggressive in the sales room, such as last week when a Monet water lily fetched the equivalent of $81.4-million Canadian, doubling the previous high for the French master.

Christie’s raised $558-million overall during the London summer season of impressionist, modern, post-war and contemporary art, while Sotheby’s has raised $454-million with just the relatively minor contemporary day sale to go.

“At the high end of the market there is a combination of extreme wealth and a lack of alternative assets for these people,” said Anders Petterson, founder of ArtTactic, which tracks confidence in the art market.

“Auction houses are appealing to largely recession-proof buyers, including wealthy individuals from the Middle East, Russia and India.”

But falling share prices, inflationary pressures and rising costs of oil appear to be taking their toll on the middle market.

At the Phillips de Pury contemporary art sale on Sunday, one-third of lots on offer failed to sell and the auction total of around $49.5-million fell short of its low pre-sale estimate.

“It’s evident … that the high end of the market (over $1 million) is currently operating independently from the lower price segments,” the latest ArtTactic survey concluded.

The sharp rise in values for high-quality art has encouraged owners to part with their best paintings and sculptures.

“It can be good news for the art market if some people are hurting because of exposure to other assets, because it gets them to put works on the market they probably would have preferred to keep,” said Ben Crawford, chief marketing officer at MutualArt.com, an online art information service.

He, like Petterson, sees values for the best works of art continuing to rise, and takes issue with the theory put forward that prices could be heading for a fall.

At the back of people’s minds is the art market crash of the early 1990s, and comparisons have been drawn between the bubble created by Japanese buying then and aggressive Russian collecting today.

“There’s an argument that there are a few rogue billionaires propping up the market, but that is clearly not the case,” Crawford said.

While generally confident, ArtTactic’s Petterson warned that psychology plays a big part in a market where the perceived value of brushstrokes on a piece of canvas was everything.

“The problem is when people in the market start to question and become uncertain,” he said.

“There could be a political or economic jolt that is so dramatic that it distracts people at the high end of the market, and it is like a house of cards.”

Mike Collett-White

About visionsart

Visions Art is a premium gallery for Modern and Contemporary Art. Established in 2001 in Mumbai, advising private and corporate collectors on predominantly Indian Contemporary Art. Since 2003, the gallery opened up its new space in heart of south Mumbai, India. The permanent gallery space is designed as a private art space where both changing and its permanent collections are shown. The gallery’s program draws upon a diverse range of disciplines and intellectual perspectives while maintaining a clear progressive thread. Supporting mid-career and historic figures, as well as launching emerging artists. The gallery represents works by artists who are considered to be at the forefront of Indian contemporary art and is constantly looking to establish a roster of the more progressive artists from India and abroad. Indianartnews.info is a news post blog providing a viewers updates on the latest news and events related to indian art from across the world

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