You bring up a great point about the fact that auctions aren’t the best method for selling artworks in this current economy given the fast pace of the sales while buyers are hesitant to begin with. I do think that galleries and fairs are doing better because they have more flexibility to change their prices, while auction house estimates (and often reserves) are set approximately two months before the actual sale transpires, so when the sale finally occurs the estimates do not reflect current market conditions. However, looking at the results from Sotheby’s London sale, it is clear that the auction house consulted with the sellers of many of the works in the sale and adjusted the reserve price for many of the lots to reflect current conditions. This resulted in many more lots not being bought-in but instead selling for far below the lower estimate. This sort of change is the beginning of the correction, as the prices corrected to the new market conditions which exist in the art market.
Meanwhile, where did you hear that fairs and galleries are still doing extremely well? I’ve heard the opposite not only from people at Frieze but also in the media:
First of all I say in the video I say that many of the fairs and galleries are reporting strong sales not that they are doing extremely well. Many galleries and fairs are reporting strong sales taking into consideration the current economic climate but there are also reports of galleries and fairs not doing sell which is inevitable. If a major correction was taking place, however, one would expect reports of poor sales across the board.
I also think that you will find that most galleries will not be discounting their prices and have not been discounting their prices because to do so is seen as taboo and not good practice. There will however be galleries that do reduce their prices but it will most likely be only on those works by emerging artist’s whose desirability may be particularly low at the moment due to people having to justify their purchases far more at the moment.
Also Adam, the second article from the WSJ that you posted says that sales are slow which is referring to the fact that people are taking longer to make a decision about what they purchase as opposed to not making a purchase all together. I think that it is extremely important to make the distinction between slow sales and poor sales because there are many reports of slow sales which does not automatically mean poor sales. People are still making purchases but are being far more selective and taking more time to ensure that their purchases are justifiable.
The first article you posted from artinfo.com also reports that buyers are being more selective and slower to make a decision and also that galleries are having to work harder to make a sale but are still getting the sale in the end. I think that this quote from the New Statesman article sums up what is happening at Frieze:
“In other words, many works failed to sell but, given the economic realities outside the art world, there was still an astonishing amount of buying going on.”
It is important to look at the big picture and not just a couple of articles that give rather ambiguous and potentially misleading accounts of what is happening. Journalists will always look for the worst in a situation because it makes better headlines. Remember that Doom and gloom sells.
Gallery sales are something I cannot attest to, as I am still unrepresented at the moment. Art *fairs*, though – now this is something that with great conviction I can honestly say that yes, they are doing quite well. The amount of sales has alot to do with the artist’s work as well.
War Eagle Arts and Craft fair, ranking in 3rd in the nation for size and sales did quite well this year. The ones who sold the most had the most variety in prices, a little of something for every budget. Another important thing to note was that artists whose work seemed familiar or was obviously inspired or attributed to another artist’s stylings failed to sell out with much interest. Unique works, whether oils, acrylics, fibre arts or like my own, intricate handcarved and heavily textured pieces did extraordinarily well.
Of most of the vendors there watched people pass, while those of us offering more than just another Bob Ross or Warhol inspired canvas panel had customers who were everey scale of economic status, avid collectors and newly curious alike…it’s just a more informed market now.
Last year, people bought whatever they had money handy for, if it suited their tastes. This year, questions abounded as to what style, media, techniques, and tools were used. People were relieved to be offered a COA, and most knew what one was (last year, it was a little known addition to the purchase.) I attended, sold out, did very well. Most assumed I’d *just* break even. Originality and having alot of information on hand for any who asked made all the difference. All other fairs attended since March 2008 have followed the same trend. People who don’t know are asking, curious about their first investments into starting a collection. Seasoned collectors are asking to make sure the purchase will enhance their walls and portfolios, rather than worry if the value paid was lost forever, or worse, wasn’t worth it . I apologize for replying to this, with no formal art teachings or degrees…but when it comes to fairs, even juried ones, that’s when I have at least enough experience and confidence to speak up.
Nick, I thank you for your time spent on your blog – it shows, and is one of the few things I read continually these days. Yourself and C-Span are the majority of my weekly “e-bookshelf” fodder, and it is appreciated.
I also apologize for the spelling errors above, I have had health issues recently that affect my eyesight, and not for the better. ~ LHK
Leonardo da Vinci