Art+Object's Ben Plumbly said he thought the secondhand art market was beginning to soften, but there would still be growth. Photo / Alex Burton
New Zealand’s art market has grown in value rapidly over the past two years, but has the bubble burst? Raphael Franks speaks to local auctioneers about how the market is performing now.
Different auction houses are conflicted on whether the country’s art market is softening amidst tougher economic conditions this year, as the prices of some artwork stagnate compared to the ”phenomenal” growth seen when people emerged from Covid-19 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 this year is $54m, with still some sales to close, it wasn’t 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 the average value of each piece was $5,480 - which almost doubled to $10,776 last year.
This year though, the average value of each artwork sold slumped to $8,835.
And just in August, Plumbly told the Herald of Covid’s effect on rising art sale values and of the possibility that tougher economic conditions may delay 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.”
Art + Object had two auctions recently which “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.
Plumbly said: “People don’t borrow to buy art - it’s money they already have. So it’s not whether they have the money, it’s whether they’re confident spending it”.
But Charles Ninow, 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],” he said.
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”, Ninow said.
That auction saw all-time price records for Ralph Hotere, Louise Henderson and Adele Younghusband, who Ninow 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.
“It is interesting - you look at the world at the moment and we still see this success. As headlines get stranger, the art market gets stronger.”
“We’re looking at our crystal balls, looking at the newspaper - all the headlines of rising interest rates and costs of living and it was a concern, but we still turned out an incredible sale,” Ninow said.
He said the art market divides sales into two kinds: consigning art from different sources - Webb’s “bread and butter”, and single-vendor sales such as BNZ’s collection.
“Single-vendor sales have big excitement and always perform very well, in that mixed vendor category its unheard of to see such high sales values and volumes.”
Ninow said the growth today was at the top end of the market.
“Paintings are more likely to sell over their estimated value if they’re priced higher.
“People want to buy high-value paintings.”
He reiterated the Covid-effect, as people came out of lockdown there was unspent money in the economy that could go into the art market. It was a convenient way to spend that unspent cash, he said, that replaced the “cultural enrichment” international travel provided previously.
There was also something to be said for buying physical works in an age of crypto, where people could buy and own art to leave to new generations.
“You are a custodian,” Ninow said.
“[Softening markets] is an interesting idea - the numbers don’t say that. If people feel like it is, it’s because you’re seeing people shift to those higher-value paintings. If you look at the top end of the market it’s certainly not softening.”
And Art + Object’s Ben Plumbly agreed the market favoured high-quality works.
“Valuing art is pretty difficult. Art is of limited intrinsic value. The canvas is only a few dollars, and the oils are also only a few dollars too, the values have always been contingent on the quality.”
“Figures of the modern art market, local collectors and artists from the 50s, 60s and 70s, they’re coming up for sale now and most great quality works are in private collections.”
While these sought-after artists were being sold on the market, both auctioneers said there would be interest from collectors.
While Ninow acknowledged there wouldn’t be the double-digit growth of 2020 to 2021, he expected this year’s total sales would still edge above the last.
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