Rewinding the Art Market

Rewinding the Artificial Advancement of the Art Market

rewind.jpgThe price people are willing to pay for an artwork should be based on factors such as provenance, size, subject, artist, period etc. which have not been artificially altered by people for the purposes of monetary gain otherwise the perceived value of the artwork is in fact false. Because the manipulation of the value of artworks is not going to go away, the task of determining the status and health of the art market is made all the more difficult. The current art market boom has caused the manipulation of the value of artworks to increase dramatically to the point where it is as though someone has pressed the fast forward button resulting in the current market prices for artworks being several years ahead of where they should be. It is because of this artificial advancement of prices that the long term stability of the art market is being questioned and people are predicting what could be considered to be a rewind of the art market.

A real view of the current state of the art market would require the removal of the following manipulative practices which cause the value of an artwork to be artificially advanced:

1. Dealers such as Larry Gagosian, Jay Jopling and Leo Castelli bidding on works by artists that they represent in an attempt to drive up the value of the artist’s work.

2. Auction houses giving minimum price guarantees to their vendors to secure the most valuable and desirable works for their auctions.

3. Auction houses paying dealers to begin the bidding for works that look as though they are not going to receive any bids in exchange for a lower buyers commission or a percentage of the commission if the dealer wins the auction.

4. Auction houses manipulating the value of commission bids by subtly convincing each new commission bidder to exceed the bid of the previous commission bidder.

5. Auctioneers increasing the bid on an artwork by pretending that a bid has been made when it hasn’t in an effort to encourage people to make real bids or to encourage people to make higher bids.

Until someone figures out a way of calculating the value of an artwork minus the effects of the above practices it will continue to be difficult to determine the current state of the art market.

Nick**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications.

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9 Responses

  1. Boy I wish I could figure that out! As does everyone in the art world I suppose. The fact that true value and perceived value are so different is unsettling. These are the kind of negatives that occur in a market that is unregulated.

  2. I have a painting by a British painter called Leonard Rosoman. It is framed 29″ X 32″ called :Storm at Night. Lake Toha. it is dated 8/01/1969 and done in Gouache. I would like to sell it and I am in San Francisco. Any suggestions?

  3. Hi, Nicholas, I have just found your blog on propeller.com, it’s now a favorite! It is really hard to find objective criteria for artists and artwork, thank you for your help!

  4. Intelligent analysis.

  5. Hi Alan,

    Check out Bonhams & Butterfields. They are a famous auction house, just below Sotheby’s, Christie’s and Phillip’s and they have a location in San Francisco. Give them a call and you can set up an appraisal of your work. I believe Sotheby’s does this for free, not sure if Bonham’s has the same policy though. Good luck!

  6. People can speculate as much as the like about when the art market will experience a correction but because of the nature of the art market it is virtually impossible to tell what or when will cause the correction. At least it makes things exciting!!

  7. […] guy has some thoughts about bringing realism to the prices people pay for art. Good luck. As someone once said, “In matters of taste, there can be no […]

  8. Hi Nicholas

    My name is Daryle Lambert and I to blog everyday. My blog can be found at http://www.31corp.com. I disagree with you. The reason that the Art market is Red Hot is because the difference in the currencies today. People buying paintings from America are getting the values of a life time. They are buying the best Art Work in the world at half price. The tide has turned because it used to be the Americans were buying everything because of the strong dollar but today the dollar has collapsed.I don’t think that the Art Markets have come close to their high so stay tuned and don’t let the chicken littles suck you in.

  9. Hi Alan, I might be interested in your picture by
    by Leonard Rosoman. Do you want to send me an email about it? Mark

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