Art sales bubble softening — or is it?
Auction houses are conflicted on whether the country’s art market is softening amid tougher economic conditions this year, as the prices of some artwork stagnate compared with the “phenomenal” growth seen when people emerged from lockdowns.
While auctioneers spoke of unprecedented sales since Covid, including a number of works from an elite grouping of local artists which easily fetched over $1 million this year, there was some concern art collectors’ confidence in spending big bucks may be waning.
Still reeling from the $15m success of the auction for the BNZ Art Collection in September, other auctioneers say the secondhand art market remains strong as people see art as an investment that won’t evaporate.
Art + Object auctioneer and director Ben Plumbly said: “I definitely think things have begun to soften this year . . . but we’re still in the midst of ongoing growth.”
Plumbly explained the apparent contradiction of continuing growth and burgeoning stagnation: Individual artwork no longer exceeds its estimated value as much as over the past two years, but the total value of all sales increased as the number of pieces sold continued to grow.
“I think it’s becoming less common that things are making two or three times their estimate,” he said.
Plumbly quoted annual sales data from the Australian and New Zealand Art Sales Digest, which appeared to reflect his thoughts.
While the total value of sales so far this year is $54m, with still some sales to close, it was close behind last year’s $62m. And last year’s figure was leaps and bounds ahead of 2020’s total sales of $25m.
The average value of each work sold paints a different picture. In 2020 it was $5480 — which almost doubled to $10,776 last year. This year though, the average value of each artwork sold slumped to $8835.
And just in August, Plumbly told the Herald Covid’s effect on rising art sale values and of the possibility that tougher economic conditions may curb that growth.
“We’ve had a bizarre moment over the past year or so that has manifested in some phenomenal activity in the saleroom,” Plumbly said.
“It’s the Covid-related moment that resulted in a lot of our clients not being able to travel so much, so we’ve had a far greater captive audience.
“When vendors see that works are selling well, it’s natural that the types of paintings you seldom see become available, because vendors feel like they’ll find their market.”
Two Art + Object auctions recently “demonstrated the robustness of the New Zealand secondary art market in the face of growing economic uncertainty,” he said.
The Important Paintings and Contemporary Art auction sold work by Richard Kileen, Max Gimblett and Robert Ellis for “new record prices” last Thursday and made a total of $2.2m, while pieces by Frances Hodgkins, Peter Siddell, Stephen Bambury, Colin MCahon, Ralph Hotere and Tony Fomison among others sold for “strong prices”.
Plumbly said $1m-plus sales were still relatively rare and although 2021 was an unprecedented year for New Zealand art auction houses, he sensed the market was pulling back.
“With rising interest rates, increased inflation and a softening housing market, we expect things to settle back a little and become a touch more buyer-friendly,” he said. “People don’t borrow to buy art — it’s money they already have. So it’s not whether they have the money, its whether they’re confident spending it.”
But Charles Ninnow, Webb’s director of art, remained enthused by the art market’s continuing success.
“We had an auction a week ago which was even bigger than Tuesday night’s [from a different house].”
The Works of Art auction at Webb’s on Monday, November 21 made $6.2m, while the sales from Auckland’s International Art Centre’s latest auction have yet to be revealed. The results from Works of Art “indicate a bullish market sentiment for New Zealand art”, Ninnow said.
That auction saw all-time price records for Ralph Hotere, Louise Henderson and Adele Younghusband, who Ninnow said hadn’t seen the “kind of market recognition they rightly deserve.” A suite of works by Hotere alone sold for just shy of $1m.
“As headlines get stranger, the art market gets stronger,” Ninnow said.