Prices stable ahead of the spring auctions

[20/03/2003]

 

Despite the geopolitical upheaval centring on the Gulf, art prices since the start of the year are little changed from 2002. Things were very different in 1991, when the first Gulf war combined with Japan’s economic slump to plunge the art world into a crisis that lasted half a decade. The market had peaked in May 1990 at an all-time record — USD 75 million for Van Gogh’s Portrait of Doctor Gachet — but collapsed as important investors pulled out of the speculative bubble. Twelve years on, it seems to be the sellers not the buyers of artwork who are losing their nerve.

Traditionally, January and February are slack months for auctioneers and in 2002 generated just 8.8% of the year’s sales. But we can still pick out a clear trend. While 2002 marked a long-term rise in the no-sales ratio, buy-ins have been falling since early 2003.

Artprice Index of paintings (Feb. 2001 – Feb. 2003)Base February 2001 = 100

In January-February 2003, the no-sales ratio was 31.5% versus 32.5% the previous year. This trend reversal is due to a sharp fall in sales volumes. Auction investors have less and less choice. Fewer lots are coming up for auction as collectors, reluctant to commit their dearly bought investments to a weak market, put ever fewer works up for auction. Auctions become scarcer. The number of catalogued fine art auctions in January fell from 620 in 2002 to 400 in 2003.
This is not all bad news. It helps maintain price levels. The price index for paintings in February 2003 was in line with November 2002 and not far off February 2002 levels. According to the Artprice Index, EUR 100 invested in a painting in February 2001 was worth an average EUR 109.50 in February 2003.

Stable prices augur well for the coming weeks and point to healthy bidding at the upcoming prestigious auctions in New York. It remains to be seen whether the auction houses can find the sellers to fill their catalogues with quality art.