Sotheby’s sells HK$ 2 billion in Hong Kong salesLe-Min Lim of Bloomberg reports Sotheby’s sales in five days of auction, 2,400 lots comprised of paintings and antiques, fervent bidding pushed prices above pre-credit-crisis levels. All in all over HK$2 billion or US$258 million was sold exceeding auction estimates of HK$1.3 billion. Artist Liu Ye’s acrylic and oil painting fetched new artists record selling for HK$19.1 million.
Image courtesy: Bloomberg
21 March 2010, The Economic Times published an article: “Good time for art investors as prices are favourable” suggesting that art market is now on the upswing and there are ''several instances where [art] works are available at competitive prices''.
Collectibles faring well during economic crisis
The Times reported in July 2009 that investors are turning to collectibles during the economic downturn. Art has been hit hard by the economic crisis, particularly contemporary art. However, there are signs that things are stabilising, with top-end traditional works faring the best. Old Masters are reported to be selling pretty much at pre-credit crunch prices. This was evidenced by Christie’s Old Masters & 19th Century Art sale in July 2009 that sold 76% by lot and 91% by value. The most expensive item sold was The Madonna and Child in a landscape with Saint Elizabeth and the Infant Saint John the Baptist, 1516, by Baccio della Porta, called Fra Bartolommeo – a world record for the artist at auction (below).
Christie’s Images Ltd. 2009
Investors turning to art, jewellery, gems and watches during the downturn
According to the recently released Cap Gemini Merrill Lynch World Wealth Report 2009, HNWIs increased their “investments of passion” during the economic downturn as a means of “flight to safety”. Fine art remained the most popular passion investment with UHNWIs investing 27% of their total passion investments here. HNWIs increased their exposure to art significantly, up to 25% in 2008 from 20% in 2006. HNWIs also increased their allocation to jewellery, gems and watches, which became the third largest category of the passion investments with a 22% allocation, up from 18% in 2006. Allocations to wine, antiques, coins and memorabilia remained roughly the same with a 12% allocation. Europeans and Latin American HNWIs were the predominant investors in fine art representing 30% and 27% of all art investors respectively.
A late Picasso holds its value in midst of recessionPablo Picasso’s “Homme à l’épée” sold for $6.99 million at Sotheby’s Evening Sale of Impressionist & Modern Art held on the 24th June 2009 in London. The painting depicts a musketeer from the artist’s late oeuvre and is one of his most important subjects of this period. Overall the auction was the most successful since last June in terms of sell-through rates, with a sold-by-lot rate of 85.2% and a sold-by-value rate of 90.8%.
Indian Art Funds
As the speculators abandon the emerging art markets of India and China, concerns naturally surface regarding the outlook for art funds that were launched as the art bubble was inflating in these markets. It is estimated that $30 to $40 million has been invested in Indian art funds over the last 4 years and these funds may need to start selling as early as 2010. Should demand for Indian contemporary art not recover by then, expect further price weakness as supply hits the market.
Islamic Art
In line with other geographic regions, the Islamic art world has seen a significant slump in the past year. Of the 18 lots put up for auction at Sotheby’s inaugural Arts of the Islamic World auction in Qatar on the 19th March 2009, only 5 sold, totalling $4 million with fees. This is in stark contrast to the $31 million raised at Sotheby’s Islamic Sale in London in April 2008, before the worst of the bank failures took hold and crude oil prices plummeted.
