Comments on: Art Auction Estimates Mean Little – artmarketblog.com http://www.artmarketblog.com/2008/11/08/art-auction-estimates-mean-little-artmarketblogcom/ Art Market Analysis by Nic Forrest Tue, 07 Feb 2012 17:54:00 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Mark http://www.artmarketblog.com/2008/11/08/art-auction-estimates-mean-little-artmarketblogcom/#comment-1693 Mark Thu, 13 Nov 2008 16:42:47 +0000 http://artforprofits.wordpress.com/?p=1194#comment-1693 Estimated prices do not dictate what something will sell for at auction, bidders do. Some times estimates are intentionally low in order to encourage bidding. It is not in the auction houses interest to inflate the estimated value of an item because that will discourage bidding. Smart bidders do research before auctions and don't solely rely on an auction houses estimate. Reserves are not allowed over the low estimate. Some auctions have no reserve. If an item does not meet the reserve, the consignor still has to pay the auction house commission (buy back). There are several centralized databases on the internet for previous art auction results, they charge a subscription. Generally, most auction results are considered wholesale prices in the trade since most of the bidders are dealers. Estimated prices do not dictate what something will sell for at auction, bidders do. Some times estimates are intentionally low in order to encourage bidding. It is not in the auction houses interest to inflate the estimated value of an item because that will discourage bidding. Smart bidders do research before auctions and don’t solely rely on an auction houses estimate. Reserves are not allowed over the low estimate. Some auctions have no reserve. If an item does not meet the reserve, the consignor still has to pay the auction house commission (buy back). There are several centralized databases on the internet for previous art auction results, they charge a subscription. Generally, most auction results are considered wholesale prices in the trade since most of the bidders are dealers.

]]> By: artforprofits http://www.artmarketblog.com/2008/11/08/art-auction-estimates-mean-little-artmarketblogcom/#comment-1692 artforprofits Wed, 12 Nov 2008 02:22:10 +0000 http://artforprofits.wordpress.com/?p=1194#comment-1692 Hi Nikki, Thanks for the comment. It is definitely in the best interest of the auction house to predict what the sale price of an artwork will be however the auction houses use many different tactics that mean that they are really dictating what they want an artwork to sell for as opposed to predicting what the market will value it at. Nick Hi Nikki,

Thanks for the comment. It is definitely in the best interest of the auction house to predict what the sale price of an artwork will be however the auction houses use many different tactics that mean that they are really dictating what they want an artwork to sell for as opposed to predicting what the market will value it at.

Nick

]]> By: Nikki Milavec http://www.artmarketblog.com/2008/11/08/art-auction-estimates-mean-little-artmarketblogcom/#comment-1691 Nikki Milavec Tue, 11 Nov 2008 20:09:36 +0000 http://artforprofits.wordpress.com/?p=1194#comment-1691 "Basically what I am getting at is that auction houses do not have to justify the estimate that they place on a work and as such are able to manipulate the perceived value of a work by providing highly inflated estimates." This is a great sentence, it really is, and I agree with it for the most part. However, they do have to internally justify the estimates within the actual auction house for what revenue they are projected to receive from any given sale. Not to mention the undisclosed reserves that are there to uphold.Thereby, I don't think that the specialist are conniving little strategist that try their hardest to pull the wool over our eyes. It is in their best interest to try to predict as close as possible what the actual sale will achieve. Every case is unique and there are no hard and fast rules or standard formulas for appreciation or depreciation of art. Valuation is always open to subtle and mysterious anomalies and variables; after all it is an art and not a science. All one ever has when assessing arts potential value is soft statistics and the opinion of someone with a reputation for being familiar with any given genre. I honestly do not envy the position of the current "valuers" at the auction houses because the art market is "readjusting" in a big way and they do have their own "art of predicting" reputations to uphold. Besides which, if you are a collector that is actually really interested in a piece, you'll do your research and or have it done for you before you bid, so the estimate won't be your deciding factor. “Basically what I am getting at is that auction houses do not have to justify the estimate that they place on a work and as such are able to manipulate the perceived value of a work by providing highly inflated estimates.”
This is a great sentence, it really is, and I agree with it for the most part. However, they do have to internally justify the estimates within the actual auction house for what revenue they are projected to receive from any given sale. Not to mention the undisclosed reserves that are there to uphold.Thereby, I don’t think that the specialist are conniving little strategist that try their hardest to pull the wool over our eyes. It is in their best interest to try to predict as close as possible what the actual sale will achieve.
Every case is unique and there are no hard and fast rules or standard formulas for appreciation or depreciation of art. Valuation is always open to subtle and mysterious anomalies and variables; after all it is an art and not a science. All one ever has when assessing arts potential value is soft statistics and the opinion of someone with a reputation for being familiar with any given genre.
I honestly do not envy the position of the current “valuers” at the auction houses because the art market is “readjusting” in a big way and they do have their own “art of predicting” reputations to uphold. Besides which, if you are a collector that is actually really interested in a piece, you’ll do your research and or have it done for you before you bid, so the estimate won’t be your deciding factor.

]]> By: Dorian Price http://www.artmarketblog.com/2008/11/08/art-auction-estimates-mean-little-artmarketblogcom/#comment-1690 Dorian Price Sun, 09 Nov 2008 19:41:50 +0000 http://artforprofits.wordpress.com/?p=1194#comment-1690 I was just thinking about this very topic and how much swing currently going on in the art market. I was just thinking about this very topic and how much swing currently going on in the art market.

]]> By: Swanke Gallery http://www.artmarketblog.com/2008/11/08/art-auction-estimates-mean-little-artmarketblogcom/#comment-1689 Swanke Gallery Sun, 09 Nov 2008 18:28:25 +0000 http://artforprofits.wordpress.com/?p=1194#comment-1689 I agree. It would be great to have a centralized database of all art sales that everybody can use. This would keep sellers and buyers honest. I agree. It would be great to have a centralized database of all art sales that everybody can use. This would keep sellers and buyers honest.

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