The REAL State of the Art Market –

The REAL State of the Art Market –

Art auction results are usually used by the media as the primary indicator of the health of the art market and have received a huge amount of press since the financial crisis took hold as reporters and journalists try and make sense of what is going on. The problem is that while most reporters and journalists have been using art auction results to determine the health of the art market during the financial crisis, buyers and sellers have been changing the way they buy and sell in response to the financial crisis. One of the main characteristics of this change in buying behavior has been a reduction in the number of people buying and selling at auction and an increase in the number of people buying and selling at fairs and galleries which has resulted in a significant decrease in the price being paid for works and the number of works being sold at auction. To the uninformed spectator the lack of success being achieved by the auction houses indicates that the art market is in a bad way but in reality the poor auction results are a result of a change in buyer and seller behavior as opposed to a market meltdown. In fact, many art fairs and art galleries have been reporting very strong sales and an increase in the number of people showing interest in buying from them.

At a time when people feel the need to control their spending and be cautious with their money the art gallery or art fair is a far more suitable option for buyers and sellers than the art auction. The stock market meltdown and general financial crisis has resulted in people being far more cautious with their money and wanting more control over their finances. The characteristics of the art auction are at odds with the current sentiment and mentality of art collectors and investors which has resulted in more buyers choosing to make their purchases at galleries and fairs as opposed to at auction. Art auctions are usually emotionally charged, high pressure events that require quick decisions and a high level of confidence that can often see people spending more money than they had planned on or making purchases that they had not planned on making. On the other hand, art galleries and art fairs offer the buyer a more controllable, lower pressure and less emotional method of buying that allows for contemplation, consideration, analysis and justification of potential purchases as well as the ability to make far more discreet purchases.

While the future of the economy and the status of many people’s financial situation is uncertain it would make sense that people would be far less likely to make emotionally based purchases or be take part in any sort of transaction that they don’t have total control over. Just because people are experiencing a time of economic turmoil and financial crisis that requires a more cautious approach to spending and investment doesn’t mean that people aren’t going to continue investing money. Likewise, just because people are not buying at auction doesn’t mean that people have abandoned the art market all together and are not buying art. In fact, the recent stock market meltdown and poor performance of other investment markets has resulted in an increase in the desirability of art as an investment because art is a tangible asset and has proven to offer a relatively high level of insulation from the effects of economic and financial market crises. It is important to remember auction results do not necessarily reflect people’s confidence in the art market or the overall health of the art market as can be seen by the current situation. As far as I am concerned the art market is still showing plenty of signs of strength and resilience which I believe will continue to be the case.

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

6 Responses

  1. Now that is a bit more posotive Nick from you.

    The market is strong and it is changing, have you seen on the ‘FACEBOOK’ site how Galleries and Artists are mixing? they don’t even have to meet at a Gallery.

    I think the Art World and buyers have a lot more choice of what to buy and ‘DON’T’ have to rely on Top Galleries to make artists the in thing of the day.

    Art is down to personal choice Nick and there is a lot of choice now, there are some great talents to be sought now, just take a look on my network, the talent is there and it could be from an academic or a naturally self taught artist.

    The Art World will have to adjust to ‘US’ now, it is a sellers market, not a buyers market.

  2. I found your post very informative. Auctions are high stress and a lot of first time collectors are nervous to try auction buying. It also seems that there are a lot of middle class collectors coming out of the woodwork. It is easier for them to acquire art at a gallery or fairs. Either way, the art market is as bad as they make you think it is. I am glad there is a blog like yours that gets the facts right. I am going to link to you from my blog. Check out my gallery


    This is Vincent’s message on the Art Market Nick…………..

    To Vincent, My Friend.

    In the summer of 1993, Vincent you came to me.
    You touched my hand and linked our souls.
    Why me? Why me?
    You’re energy ignited me, touched my inner light.
    You guide me through my darkest night.
    No one understands ‘us’, they think they do, no one can feel or think the way that ‘WE’ do.
    I hear your voice, I feel your hands, and you show me your light and how to stand.
    You guide my hands, you guide my paint, you tell me clearly, so very dearly.
    How can ‘WE’ make them understand, the beautiful way you touch my hand?
    I have a gift, thanks to you, it has helped me through.
    My hands paint fast, it is so clear; I listen when you are so near.
    I feel your touch, I feel your pain, I feel the sorrow-without your gain.
    The World watches you, hypes you up.
    “What a joke” I hear you say.
    You are a Master of Art, You knew it then, what is wrong with the mad men?
    You were not crazy back then, just an artist with a voice, no one listened back then.
    “So hear this” I hear you say, “Now look at me now I’m away, watch me smile and laugh out loud, as I watch YOU all bid away”.
    “What fool’s you are and Mad Men be- to give your wealth away in glee”.

    As I come back and help dear Dawn on this Great October Morn.
    We both laugh out loud and work on our art that found us both from the start.
    We use the channels to portray our energy thought, our magnetic moments.
    So now what will be the out come of this?
    Who cares, we have our dreams our Spirits alive.
    Watch and wonder how Dear Dawn breaks on this October Morn.
    Watch her paint with peace and light, her brush strokes shine in tune with her mind.
    Bid away you mad men are, as ‘WE’ watch away with glee.
    So who is mad in the end, not ‘WE’, we have to go quietly on.
    Now let me pass you to My Dear Dawn as she shows you all the way to go, Listen with your eye, the eye so pure.
    You will learn the upper score.
    Bow your heads in shame, to ‘US’ it is all the same.

    Dawn and Vincent.

    26th October 2008

  4. The real deal around these here parts is that there is going to be a ferocious winnowing out of the phonies, the overhyped, the overpromoted, the clowns and the lightweights. The market is going to be getting radically more selective about what constitutes value. Histroically speaking there have been very, very few artists who have made the transition from contemporary popularity to hundred year strength. There are mountains of exhibition catalogs from the fifties, sixties, seventies, eighties, and nineties featuring the next this or next that, names long forgotten. Makes you want to reread Marcus Aurelius, there was a man who understood the transient nature of things.

    Often the real greats have such a unique eye and are so unwilling to compromise with day to day standards that even the well informed, the culturati, have a hard time wrapping their minds around an intelligence that well exceeds their own.

  5. I have a friend that owns an art gallery in New York. Fischbach Art Gallery New York is the name and site. He has said that the art boom is over and business is really slow. I’m sure many of the art galleries have already closed down. I don’t think it is quite as bad as the restaurant industry in NYC, but times are tough for New Yorkers everywhere. They have no one to thank, but the greedy people on Wall Street!

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