Last month, Christie’s realized an incredible $495 million in a single sale — its May 15 evening auction of postwar and contemporary art — marking the highest-ever total for any category in its entire history. Ten years ago, that level would have been roughly the overall haul in a typical, healthy two-week cycle of auctions that included not only postwar and contemporary art but classic Impressionist and modern art as well. Now, in one single week of auctions in New York, the big auction houses together racked up over $1 billion in postwar and contemporary sales alone.
At the same time, the takes for more traditional Impressionist art, while by no means lackluster, actually dipped year over year. This year's spring New York sales realized $479 million, as opposed to $524 million a year before. It wasn’t long ago that it would have been a shock for a postwar work to claim the place of most-expensive lot of the season. Yet in the recent sales, Jackson Pollock’s abstract painting “Number 19” (1948) brought in $58.4 million at Christie's, far outpacing the highest Impressionist trophy, Cezanne’s still life “Les Pommes” (ca. 1889), which sold for $42.6 million at Sotheby’s a week earlier. At Christie’s itself, the top Impressionist lot didn't even come close: Chaim Soutine's portrait of a baker, “Le petit pâtissier” (ca. 1927), went for a “mere” $18 million. All in all, this spring, Christie's $158-million Impressionist evening total amounted to just about a third of what it earned in contemporary.
Tobias Meyer, Sotheby’s worldwide head of contemporary art, adds that the robust price appreciation for more recent art is not just at the top, or for relatively classic postwar artists like Pollock. “The growth goes through all fields. You see it for Warhol but also an artist like Nate Lowman,” Meyer explains. “Three years ago paintings that were selling for $18,000 are now taking $900,000. We’ve also seen enormous growth in the middle market, such as for Christopher Wool. I told people to buy at $900,000, now the paintings are $3 million.”
What does such unprecedented growth in the market for recent art say about the broader art market and the economy? And more importantly, is such appreciation for art that is by definition less tested even sustainable?
The auction houses are definitely betting that the shift is not a fad, but reflects a change in how the market functions. For one thing, there's the question of supply. There are simply fewer and fewer Impressionist and modern masterpieces appearing on the market each season. The contemporary market, by contrast, provides many more targets for buyers to fixate on — and there is plenty of wealth out there to chase the art. “There is a new group of so-called ‘super-collectors’ that love to buy,” says Meyer — and to drive prices into the stratosphere, “all it takes is just two people that operate at that high end.”
In trying to explain the rise of contemporary, many observers cite the changing tastes of younger, newly wealthy buyers and an increasingly global art market that makes demand independent of any one economy. Meyer also highlights the current lack of attractive investment options for the wealthy. “I talked to a very financially savvy man after the evening sale who said there is an abundance of cash that has no place to go, and people are seeing 20th-century art as a good place to put their money,” he recounts.
Long-time New York dealer Richard Feigen agrees about the cash angle: “You’ve got a problem for people that have cash — they don’t know where to put their money.” But he also adds a cautious note: “You have a lot of money assuming that art is a good investment,” he says — and that creates a climate that lends itself to speculation.
The recent drift towards contemporary has been happening for a long time. In 2007, postwar and contemporary first became the biggest category at the major auction houses. During the height of the economic crisis, the trend seemed momentarily to reverese, as money flew back to trusted blue-chip names like Monet and Modigliani. This now seems like a momentary lapse, however. Contemporary art is breaking record after record, with volume continuing to hit new highs with each round of sales.
“Ultimately I think it is something that has been growing and growing if you look at the trajectory between last May and November,” says Brett Gorvy, Christie’s international head of postwar and contemporary art. “An increasing number of serious buyers are coming into the field looking for the best of the best.” The most recent, record-smashing season in particular marked “an alignment of the stars,” he says, with competitive buyers chasing a slew of stellar postwar works from private collections.
Gorvy notes that where $30 million used to be considered a key price point for a major postwar work, two paintings broke the $50-million ceiling at this sale, including the Pollock and Roy Lichtenstein’s “Woman with Flowered Hat” (1963), which sold for $56 million. This seems to be the new benchmark for a blockbuster lot.
Can it continue? “Obviously to find another major Lichtenstein now is going to be very tough, but there is still the possibility for a private collector to get an exceptional Basquiat.” Gorvy highlighted a buying pattern at the recent sale: If a collector failed to make a successful bid on a particular prize, they quickly focused on something else. “It’s not like you have a market which is drying up. Our collectors are wealthy but also focused enough to continue to be collecting.”
One of the more notable transformations of the market: To a certain extent, the traditional relationship of scarcity to value seems to have broken down. Feigen notes that the top prices are seen for artists like Warhol where “there is almost an unlimited supply. Meanwhile, an artist whose work is scarce like Max Beckmann or Yves Tanguy, there’s just not enough work around.”
In other words, postwar and contemporary art better lends itself to the herd mentality that governs the new art market. Artists who aren't total icons, but who also didn't produce enough to have works constantly on the market can’t achieve the kind of market momentum that feeds auction room records. “The things that are getting all the attention are the ones bringing the highest prices,” Feigen explains. “It doesn’t mean that its significant art historically.”
Feigen still maintains that the last word will still go to work that stands the test of time. “Is Basquiat’s work worth $30-to-$40 million? I don’t know,” he says. “But no one is going to wake up in 50 years and say Turner didn’t matter.”