Record Photograph Sale?

Forbes is reporting on an interesting situation which should be of interest to many appraisers.  The article references a gallery sale by Australian photographer Peter Lik through the Peter Lik U.S. gallery network for a record $6.5 million.

What I found more interesting than the actual sale and possible record prices is the speculation behind the sale as well as understanding different market levels. This particular sale through the Lik Gallery network has no supporting documentation the sale actually took place other than the galleries claim, which may be publicity based.  Additionally, Lik's work has limited value on the secondary market.

The article also notes that only half the artwork sold is through auctions, which has at least some transparency, but private gallery sales show even less transparency. Additionally, but without supporting statistics and relying on statements by consultants, the article claims 90% of artwork sold through a gallery is worth less as soon as you walk out the door.  I agree to a certain extent, as the collector may not have access to all market levels.

An interesting article to read and keep in mind about buying and selling at different market levels.

Forbes reports

Earlier this week, Australian photographer Peter Lik’s network of galleries in the U.S., Lik USA, announced the sale of “the most expensive photograph in history” when the black-and-white photo below sold to a private collector for $6.5 million. The sale of Peter Lik’s Phantom was widely reported in the media, and if true, certainly represents a new record compared to any photograph sold at auction recently. Andreas Gursky holds that record for Rhein II, which fetched $4.3 million at Christie’s in November 2011.

However, writing today in the Australian newspaper The Age, arts journalist Andrew Taylor cast doubt on whether this astonishing Peter Lik sale actually happened at all. He points out that there is no documentary proof that the private sale to an unknown buyer occurred, beyond what is said in the press release. He adds that Lik’s work has been “ignored by major art galleries and dismissed by critics. When his photos have gone up for public auction, they have not sold well.” His article also includes a 2012 quote from art consultant David Hulme that “if I was advising a client on a $1 million art purchase, I would be extremely wary of purchasing a Peter Lik photograph, however good it is. This is because Peter Lik’s photographs have no secondary market or value.”

This story is a reminder of how incredibly murky the art market is, when all of the data we have about art sales globally comes from the auction market, which only accounts for around half of total sales. The rest of global art sales occur privately through galleries and dealers who often don’t make any of their prices public or only offer this information up on an anecdotal basis. We’re basically grappling with a market where price information on half of the sales that occur is pretty much unknowable, which makes Peter Lik’s claim suspect, even if this work did sell for $6.5 million. Like the rest of us, he only has auction records and other anecdotal information to go on, so has no way of definitively knowing whether this is “the most expensive photograph in history” or not.

It’s also a cautionary tale for anyone thinking about photography, or any art work, as an investment. It should be pretty obvious that paying a lot of money for a piece does not mean that you will make money if you sell it, but you are unlikely to sell it at all if there’s little or no secondary market for that artist. As I’ve written before, according to some art consultants, 90% of art sold in galleries today is worth less as soon as you’ve purchased it. The moral of this tale? Look before you leap.

Source: Forbes