What's in the numbers? Expert opinions differ on art market performance, but does it matter?
Usually there is just one comprehensive report on the art and antiques market every year, produced in March by TEFAF (The European Fine Art Fair in Maastricht), the biggest and widest ranging quality fair for art and antiques in the world. For years it has been researched and written by arts economist Dr Clare McAndrew, and it has been treated as the last word on what has happened in terms of total sales by dealers and auctioneers, and how the global art cake has been sliced up. When a journalist needs a figure for the market’s worth and what percentage shifts there have been, they look up the TEFAF report.
But this year, McAndrew was poached by another fair, Art Basel, which is only focused on modern and contemporary art, to write her report. I don’t know exactly how prestigious it is for a fair to produce a high profile market report, but obviously the folks at Art Basel, backed by UBS, thought it was worthwhile, and launched their report during last week’s Art Basel Hong Kong fair where Asia is very much part of the equation.
TEFAF did not take the loss sitting down, and immediately retaliated, appointing another economist, Prof Rachel Pownall, who is attached to Maastricht University, to replace McAndrew and write the report. The result is that we have now had two highly detailed reports on the art market’s performance in two weeks. That’s over 400 pages of densely packed graphs and statistics with explanatory texts to absorb, compare and contrast… the perfect antidote for insomnia.
The result, though, is intriguing. Firstly, the two economists come up with different statistics for virtually every subject covered in the reports – the product of differing methodologies. Secondly, where there is some kind of agreement is that, while they confirm that public auction sales of art and antiques fell last year, they estimate that private sales by dealers and auctioneers increased, by different margins of course, taking the biggest slice of the art market cake.
So if you think you’d seen it all with record prices for Monet and others at auction, you actually hadn’t seen the half of it. The question is, have Pownall or McAndrew seen it, or is it an educated guess based on the result of a questionnaire which most dealers wouldn’t answer?
To spotlight the main differences, Pownall calculates that global public and private sales of art and antiques by auctioneers and dealers rose in 2015 by 1.7 percent to $45 billion. McAndrew starts with a much higher estimate of sales in 2015 to calculate that in 2016 they fell by 11 percent to $56.6 billion. Because auction sales are in the public domain you would have thought there would be some consensus about their sales levels, but Pownall adds them up to $16.9 billion (down 18.8 per cent) compared to McAndrews’ much higher $22.1 billion (down 26 per cent).
The auction falls were, however, compensated by the rise in private sales which, according to Pownall, increased by between 20 per cent and 25 per cent. This major market shift meant 70 per cent of the value of art and antiques sold last year was sold privately. “Collectors have become more inclined to secure deals away from auction publicly,” she says. McAndrew, on the other hand, calculates that private sales rose by only three per cent, though those with sales of over $10 million saw an increase of 19 per cent.
But do the differences matter? Do the surveys matter? For a number cruncher like Anders Petterson whose company, Art Tactic, produces performance graphs and predictions in an array of contemporary art sectors – Indian art, Photography, Latin American art, individual artists… there should me more research on the art market.
“Relying on any single source of information in the art market, or any market, is risky,” he says. “I believe we need more research and more perspectives on the art market, more transparency. When you have this you will start to create a competitive market place for information and research. Look at the hundreds of companies publishing research on the equity market and other financial sectors - they don't all say the same thing, but that is exactly why people read and buy the research.”
One thing the general reader should be clear on. These reports are what could be termed performance reports – how sales totals have gone up or down or been shared. They did not confront the price issue of whether your Modigliani was worth any more or less last year than it was the year before. For that you need a different kind of report.
