How to Value: Contemporary Art

To some, any claims to be able to value a piece of contemporary art seem ridiculous. To the uninitiated, the values of works such as Yves Klein’s Monochromes or, in truth, almost any conceptual art seem almost totally arbitrary. The reality, though is quite different.

The Art Market

The ultimate arbiter of all art, whatever its type or appearance, is the market and the market for contemporary art is currently very strong as it comes to be seen more and more as a good financial investment. Contemporary art is known to have high ‘liquidity’ – that is, a popular piece of contemporary art will have many potential buyers. Art sales are usually either retail sales such as from a gallery, or secondary sales such as at an auction. It is important to note that a retail price may be far higher than what a piece could achieve at an auction and as such valuations from different people can have different meanings. Valuing art for the secondary market focuses on market statistics and finding a comparable piece; the stronger the similarities to a recent sale by the artist in question, the better an idea we can get of its value. For contemporary art, many pieces are just one of a series and so, like prints, can often be reliably valued. Elements like subject matter, date of production, date of sale, size and medium are all taken into account when considering how alike two sales are likely to be. This can be done from your own living room through auction record websites, but the market for contemporary art is constantly changing and so expert opinion can be invaluable.

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The Beauty of Contemporary Art

Contemporary art valuation can be a complicated affair incorporating connoisseurship and market data and yet there’s almost always a subjective judgement from the buyer that drives them to purchase a piece of art even as an investment. A piece of contemporary art may truly resonate with some while appearing totally uninteresting to others; as a result, auction houses take great care to familiarise themselves with the tastes of their clients. In many cases the ‘wall power’ of an art piece (or, sometimes floor power, in the case of many installations!) plays a big role in an auction sale, with colour, size, subject matter and style all contributing to this, but some contemporary pieces also employ subtlety, minimalism and understatement to convey beauty. Beauty, as we’re always told, is in the eye of the beholder, however, and in some cases it can be humour or other emotions that attract buyers to pieces; ultimately it is personal attachments that form on viewings that push contemporary art to exceed its valuations.

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Provenance

Although the history of contemporary art is, as you might expect, somewhat shorter than older art, provenance still has an important role to play. Contemporary art has always been about treading new ground and breaking conventions and as a result, pieces that are recognised as playing a particular historical role in this command a premium. This is particularly important in a market with such prolific artists, most of whose pieces (if intended as permanent pieces) still survive. The perceived simplicity of creation of many pieces has also led to the creation of many contemporary fakes. Labels of exhibitions and galleries can trace the provenance of a piece, and many living artists take a personal interest in preserving the integrity of their work through identifying forgeries. Auction houses also stamp their lots and artist themselves sometimes also make dedications, all of which can inspire confidence that a piece of contemporary art is truly genuine.

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