Weaker Art Sales

The Wall Street Journal is reporting on weaker art sales when compared to 2015.  I reported the other day on the drop at Sotheby's, and now Christie's is reporting auction sales down by 37.5% from a year ago. The article also notes how both Sotheby's and Chrsitie's are attempting to maintain confidence in the market through higher than expected buy through rates, encourage bidders to bid online, and compares sector sales between the houses.

Overall a good snap-shot of the art market at Christie's and Sotheby's.

The Wall Street Journal reports
The global art market has gone on a diet.

After the recession, seasoned and newcomer collectors alike surged into the world’s chief auction houses to splurge on trophies carrying eye-popping asking prices. Now, art lovers are cutting back, plying fewer $20 million-plus pieces into auctions and increasingly contenting themselves with cheaper, overlooked pieces.

The resulting portrait shows a marketplace relatively healthy for pieces below $5 million but eerily thin at the top—a reversal from the last market downturn, when only masterpieces appealed. On Wednesday, London-based auction house Christie’s International offered further proof of a downturn when it said it sold $3 billion in art during the first half of the year, down a third from the same period last year.

Christie’s latest total included $2.5 billion in auction sales, down 37.5% from a year ago. Its $464 million total in privately brokered art sales also fell 10% from the first half of 2015. Contemporary art, long the engine of Christie’s market dominance, was hardest hit, its $788 million in auction sales down 45% from a year earlier.

Sotheby’s, based in New York, said it auctioned $2.4 billion in art during the first half, down a quarter from the year before—yet close enough to put the house within spitting distance of its larger rival for the first time in years. Both auction houses said their six-month totals represented sales through June 30. Sotheby’s is scheduled to release its consolidated sales, which include private art sales, next month.

Masterpieces proved more difficult to wrangle in the first half as sellers chose to ride out the market’s uncertainty rather than push their priciest pieces into the fray. Christie’s said only 29 artworks it sold during the first half achieved prices exceeding $6.5 million—compared with 47 the year before—with nothing selling for anywhere close to the $180 million that Pablo Picasso’s “Women of Algiers (Version O)” brought in 2015.

Christie’s priciest work during the first half wasn’t even a painting: It was a 14.62-carat diamond called the Oppenheimer Blue that sold in Geneva in May for $58 million following a sitcom-length bidding war. Also in May, Christie’s New York sold Jean-Michel Basquiat’s wall-size, untitled self-portrait for $57.3 million.

“There’s been a degree of uncertainty where sellers wonder if the price points can keep going up, but we think that fear is a little misplaced,” said Stephen Brooks, Christie’s deputy chief executive. “When we get good pieces, buyers come out in droves.”

Sotheby’s sold Picasso’s cubist, 1909 portrait “Seated Woman” for $63.6 million last month in London, the most expensive painting sold during the first half of the year. Sotheby’s also sold Amedeo Modigliani’s 1919 “Jeanne H├ębuterne (In a Scarf)” for $56.6 million, a record for a portrait by the artist.

Without a glut of eight-figure offerings, both houses shifted their spotlight to rare or milestone pieces by established artists who don’t typically get top billing in the houses’ marquee seasonal sales in New York and London. The strategy largely paid off, as bidders during the first half reset price levels for painter Sam Francis, sculptor Barbara Hepworth, Mexican icon Frida Kahlo, New York graffiti star Keith Haring and sculptor Henry Moore, whose “Reclining Figure: Festival” sold for a record-setting $33.1 million at Christie’s London the night before the Brexit vote.

In a bid to win back a measure of seller confidence, the houses also worked overtime to see that a higher-than-usual percentage of their smaller sales found buyers. Typically, a sale is considered successful if at least 80% of the offerings find buyers. Sotheby’s $242 million evening sale of contemporary art in May in New York only had 44 pieces, but 95% of them found takers.

Both houses also redoubled their efforts to persuade collectors to bid online, with Christie’s achieving $28 million in sales during the first half of the year, 83% more than a year earlier. The average value of Christie’s online lots, excluding wine, is $8,251.

Sotheby’s said it also drew more online bids during its live auctions this season, including one from a collector who clicked to win a $6 million pair of blue-and-pink diamond earrings.

Among the categories, Christie’s $788 million in contemporary art sales exceeded Sotheby’s $579.4 million in new art sales for the first half. Yet Christie’s struggled in other areas. It said it sold $594.4 million worth of impressionist and modern art, American art, modern British art and Latin American art during the first six months—combined. The collective sum represented a 55% drop from $1.3 billion in combined sales for these categories a year ago. Sotheby’s sold $626 million worth of art across the same categories, including $561 million worth of impressionist and modern art.

Christie’s also ceded territory in the categories of old master paintings, Russian art and 19th-century art, with combined $130 million in, up 27% from a year earlier—but short of Sotheby’s $161 combined total for the same categories.

Like its overall art sales, Christie’s sales of Asian art were down by a third during the first half, to $310.2 million, although the house fared well with a curated, cross-category sale of Asian Art in Hong Kong in May that totaled $81.7 million, with 40% of the offerings selling above their high estimates. This included a blue-and-white jar adorned with dragons that sold for $20.4 million. Sotheby’s, for its part, also managed to claw back some market share in this category, selling $460 million worth of Asian art during the first half of the year.

Collectors from the U.S. and Europe outspent all rivals this spring, each region taking home $1.1 billion of art from Christie’s. Asian buyers won 28% of Christie’s offerings world-wide.

The art market tends to quiet down in late July and August but will get tested anew at sales throughout the fall in London, Hong Kong and New York.
Source: The Wall Street Journal 

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