Why No One Trusts Art Prices Anymore

0:04It could sell for anywhere between$25 million and$100 million, basically dependent on the buyer's mood. And that's a$75 million difference. It's kind of on vibes alone.

0:21I'm Kate Brown and this is The Art Angle, a podcast by Artnet News.

0:30What's a painting worth? For art world professionals, that question of price has never been easy, but lately it's gotten harder than ever. As we've discussed on this podcast before, the art market has cooled right off. But this isn't just a downturn, it's a disruption. The system that once supported pricing is now in disarray, and dealers and advisors are feeling the strain. In a recent report for Artnet News Pro, our editor-in-chief, Naomi Rae, explored how the traditional rules of art pricing have stopped making sense. With confidence waning and speculation drying up, dealers are quietly recalibrating.

1:03And what we're seeing may be more than a correction. As Naomi reports, it could be the unraveling of an entire logic. Naomi joins me to unpack what's going on in the danger zone of the art market and how different players, from mega galleries to emerging dealers, from art advisors to collectors, are adapting. We also discuss whether we might be heading towards a more sustainable and meaningful place in the art market. Hi, Naomi. How are you doing today? Hi Kate, I'm well, thank you. It's warm and sunny in London. Unusual for London, I suppose. Yes. Great, yeah, I'm excited to dive into this. You had an excellent piece about art pricing that got a lot of reactions online and also on the fair floor at Basel last month.

1:43So we've got a lot to get into today. I'm curious, was there a specific moment or a conversation that tipped you off to the shift in the market pricing logic? It's not really a new conversation. It's something that we've been writing about at Artnet News for a couple of years, actually. I remember, I mean, as far back as 2023 at Art Basel, I was kind of writing this first day market report. And, you know, the takeaway was a kind of overwhelming kind of dissatisfaction with this price inflation that had been going on in the market for living artists. And I think I've been interested in price just in general from a more kind of philosophical perspective.

2:25It's obviously the intrinsic value of art. It's a bit of an abstract concept to begin with, but you do trust in the art market that price has been kind of informed enough by kind of real world data points that it makes it a good enough proxy for value and that it reflects things like demand or kind of what something is worth relative to other similar things. But when we have these kind of spirals in different levels of the market, especially kind of levels of the market, which are kind of pre-value getting established in the traditional way. So usually, you know, after an artist has died, you now have like a finite supply of works.

3:08And so the price points kind of get a little bit more clear. So whenever the prices for living artists start spiralling like this and kind of speculative bubbles start emerging around it, it can kind of hurt confidence, especially when those bubbles kind of start to pop. And I think that's kind of what interested me in general in price. I think why now writing about it ahead of Art Basel this year, I was trying to predict kind of ahead of time what people would be talking about at the fair. And we just come out of this auction season in May, which had a number of kind of very high profile flops.

3:46There was a 70 million Giacometti that failed to sell and a Warhol electric chair that was pulled from sale. And this is kind of a new dimension to the market kind of downturn that we've been talking about, because usually the auction houses can be pretty good at orchestrating or ensuring kind of these sort of high level successes, often actually even taking a loss to do so but you know this this kind of failure at this top level had people sort of asking a different question you know not just about kind of the market and especially in that top level of the market people were saying for a long time that it's just a supply issue you know there's not enough they're not great stuff coming up but actually when you get great stuff coming up and it's not selling you start to ask kind of is it a demand issue and And in kind of thinking about that, I was like, well, what's causing a crisis in demand?

4:39And I think certainly on at least one level, it could be this pricing situation, which is kind of, you know, when a buyer is looking at something, basically just destabilized their confidence that something's worth the sticker price. Hmm. Yeah, let's get into this question of pricing, because, you know, in a normal economy, as you sort of touched on, when demand goes down, prices tend to go down. but this isn't always the same in the art business so let's get into how an artwork actually gets priced and why is pricing so difficult and what's happening with it right now yeah it's difficult i think because the like i said the value of art is the kind of it's an abstraction it's not a financial reality and so i think i mean there's kind of two different answers to this question I think on the primary market, you know, whenever we're talking about living artists and a gallerist is setting prices, there are certain hard data points that they can look at, you know, market comps, you know, what something similar is sold for, how much it costs to make is sometimes factored into the price.

5:42Although, you know, that can vary wildly. I was talking to someone who was saying, yes, you can do that if it's painting practice. But what if the artist is making something like a video game and the production costs are ridiculously high and almost, you know, you can't actually make that back in the sale of the work, especially in kind of emerging markets. I think some dealers also try to offset some of the rising costs of participating in the art market with prices. Shipping since COVID has gotten very, very expensive, and that's kind of factored into the sticker price. And then I think the way prices go up is they look at sort of signals from the art world establishment, if you will.

6:29Things like institutional recognition. Did they get a museum show? Is there a publication written about them? Have they had positive, critical reception and justify prices going up from there? But in the end of the day, I think it is what somebody is willing to pay. So I think a gallerist will need to know their clients, their tastes and expectations. And I think to a certain degree, the lifestyle enters into this. Some collectors are perfectly happy to pay an inflated price for an artwork just as kind of the ticket to ride and some of these exciting events in the art world. And the secondary market, similarly, there are hard data points.

7:14There's historical sales. But I had a very interesting conversation when I was in New York in early spring with Brooke Lampley, who is a former auction house executive. And she was a, people overuse this term, but rainmaker at Sotheby's. And now she is working at Gagosian. And I was asking her about selling and kind of pricing. And she had some really interesting things to say about how, you know, you can have as many hard data points as you want. And of course, they are important to kind of ground you in a sense of reality of kind of what something could be worth. They don't reflect the market.

7:54The market is kind of a very now kind of thing. And you need to be very attuned to the ebbs and flows of tastes and, you know, everything from knowing kind of what sort of colors people prefer. I think she said people prefer red than they do green to understanding that, you know, generally things can go up in price as they get bigger until they get too big and you can't fit it in your living room. And then it, you know, becomes less desirable to certain types of collectors and things like that. It's a combination of, you know, numerous data points, you know, met with kind of an understanding or grounding in the market, kind of knowing what people want, basically.

8:36So a mixture of hard facts, some abstract elements, and then a lot of theater as well around all of it. And as you point out, you know, with all of these rising costs, I mean, the galleries are working with like razor thin margins. I mean, there's also staff labor, like everyone who touches that painting is getting paid from somebody. Storing work is expensive. Framing work is expensive. But you touched on the secondary market, which is an important one for establishing price. As you mentioned, Artnet's price database is a very important player in that. Could you talk about price transparency a little bit more?

9:14Yeah, this is kind of a story I like to tell just whenever I'm explaining to people that I work at Artnet and kind of what Artnet is or what it was founded on, which is this database of prices. and I spoke to Hans Neuendorf, actually the Artnet founder for my piece and he told me a little bit about what it was like when he was starting out in the art market in the 80s and kind of people doing their own independent pricing research. They didn't really know what anything was worth or you know in that market at that time or you know how to price something so they'd be going to art fairs and doing their own kind of personal research and taking notes, comparing notes and And Hans and a number of other people in the market at the time saw an opportunity there for a sort of database that you could sell access to that would record prices.

10:03And I think having that information, that's the hard data points that we were talking about. It brought kind of transparency to what was a very, very opaque market. And I think with transparency comes confidence because, you know, if you are a buyer and you are looking at this Picasso painting and you're not sure how much to sell, you could look it up and say, oh, you know, here's another Picasso painting of the same size, the same year, similar, and it sold for this amount. So you're kind of comfortable within a range of that amount. So it brings you kind of confidence and assurance. And that, you know, results in more buying, which, you know, means more selling.

10:43And as confidence grows, you know, you get more comfortable, you know, paying a little bit more than that, etc., etc. That's kind of the role that the price database played in all of this. I think people have different ideas about whether transparency is a good thing or a bad thing. I think especially when you have a market like this where prices got very inflated and, you know, that can be devastating for people in many different ways. They might not be so happy. But I think as a journalist, I'm inclined to say that transparency is a good thing for the market. Obviously, if I were a collector that was trying to offload an artwork and having to accept a price that's a fraction of what I bought it for, you know, a couple of years ago.

11:26or if I were an artist whose career trajectory is now kind of thrown into uncertainty after a speculative bubble has burst, I might have a different answer to that question. Right. Well, that's something that's been informing this kind of disarray, right, is that there was this prolonged period of time where prices were just climbing at this very steady rate. And that's an excellent atmosphere in which to be a speculator and to try to make money off of trading art. But as you reported in your piece, this has really changed. And especially the 80 ,000 to 800 ,000 range has been this so-called danger zone, according to someone that you spoke with.

12:07Why is that particular slice of the market so unstable right now? it's a danger zone for anybody who's looking to kind of purchase art as an investment right now and that is because of this price inflation for living artists this issue that i've been talking about and in this price range i'm 80 to 800 or you know 100 to a million i'm not really sure kind of it's sort of fuzzy around the edges uh how to define that but i'm talking about kind of middle market artists who are living but they're more established than kind of completely emerging artists so they they may have a few institutional shows and publications and those kind of art world or art signifiers that we talked about to their name um so you know their markets kind of grew quite quickly because they are perceived to be a little bit more of a safe investment um than you know a complete unknown where you you really are kind of taking a risk or trusting your eye you know that they will take off so they've already had like a little bit of liftoff um but because they've gotten so expensive now it isn't really the kind of safe environment that it was uh before uh this kind of spiraling speculation which was encouraged by dealers who were raising the prices quickly and really selling this narrative of art as investment got out of hand um so you're not able to resell those works for what you paid for them or you know you have you know that inventory that you can access cheaper at auction, which is not how it's meant to work.

13:41Right. And what kind of artists are we talking about when we are speaking about this range? Are there some recent examples from like the spring sales or anything like that? Yeah, yes, yes. Looking at Art Basel specifically, I can say that Jenna Gribben, she's an artist, painter, a talented painter, who had a very good 2023 market, was very, very hot. I think her auction record is up there in half a million or something like that. But her auction prices have come down. I think there was a painting being offered by Massimo Di Carlo at$250 ,000. You can find her work at auction now for cheaper than that.

14:21Similarly, I think Levi Corvi Dayan was showing another painter, 36-year-old Austin Wiener. And one of the works was available at$280 ,000 asking price. It's very expensive for these artists in that kind of period of their career. And you asked about the auctions, the May sales, I guess not so recent, depending on how you look at time in the art world. It's very accelerated. There were a lot of these stories. I think a lot of the kind of ultra contemporary artists who got very hot. We saw a number of them kind of being resold at heavy losses for their owners. I mean I don't want to pick on Rashid Johnson because I feel like we've done that enough but you know there was a big number you know there was a painting by Rashid Johnson that that someone sold at a 72 percent markdown on the price that they'd purchased it for you know just a few years earlier so that's what's happening.

15:23Right not to pick on the artist at all but it's just this cautionary tale of you know speculation and the heights from which you can fall.

15:40you've talked about this a little bit in this last answer like dealers seem to be in some cases not recalibrating their prices at all but they're sort of clinging to the old old stickers while the auctions are saying something completely different but are they in some cases putting their prices down uh yeah i mean prices are going down um whether or not gallerists are sort of writing, oh, this is at a markdown price, you know, obviously for all to see. No, I mean, the asking prices for things that have asking prices are ostensibly staying the same. But, you know, I think dealers are more open in this moment in the market to be accepting, you know, more aggressive offers or bigger discounts.

16:21They might be slower to raise the prices. If they've been raising them every year, they might be a bit more hesitant to raise them this year or next year until the market catches up a bit. I mean, there's always stories you can tell. So I think, you know, bringing prices down is like, that's not the story you want to tell. Like this isn't worth, you know, what it was. But you can say something else like, oh, you know, if you have one show from an artist that doesn't sell, you know, the next show, it's a different body of work. So the price point is different. You know, you can say the materials are different, etc etc there's stories you can tell to kind of navigate kind of shifting uh price points but yeah i think more broadly what galleries like the bigger kind of thing that needs to shift uh isn't just kind of the sticker price but i think it's the pitch you know that i think this this period this art market bubble galleries were really pitching art as an investment and in many ways That's a very lazy pitch, but it works.

17:22You can make the future upside. That's an easy thing to sell on. And I think now they're realizing that they're going to have to find another pitch. This is the other kinds of value that's not necessarily linked to making a profit on resale. And I think that's going to be challenging. Mm-hmm. Is it pushing things more into private sales as well? Yes, I think. I mean, people are less likely to take a risk at auction. Then you will see more because auctions are public failure. Private sales, you kind of have that cloak. But I'm interested to hear from you because you were at Basel, Kate. What you kind of heard on the ground, you know what were were dealers what was it like yeah I mean pricing perhaps strategically was not like an overt conversation at Basel this year but it was definitely the subtext I would say I think it was more so about vibe like people were talking about who was there who wasn't there and whether things were moving so you know price is in there but it wasn't really like overtly being spoken about.

18:34And I think that what my takeaway was is that galleries are restraining their expectations, they're bringing different things, and different kinds of works, and they're adjusting their their programs as such. So yeah, I mean, I think the data points up just point to a shifting psychology, I actually, you know, was running the numbers on our price check reports, which are far from perfect data, because they depend on what dealers tell us. And of course, the prices that they tell us are not necessarily considering discounts. And of course, sales are made without being reported at all. So it's not perfect data.

19:09But what was interesting to see was that between 2024 and 2025, the danger zone was actually in the extremes. Like on the high end, those who did bring major, you know, trophy inventory, there were few sales reported by the close of the fair as compared to the year before. So that can mean a lot of different things. And again stressing that it's not perfect data but I think the other thing that was interesting was that this 80 ,000 to 800 ,000 rose a bit from last year but it was also a lot more fresh to market pieces like a lot of work that was made in 2024 was sold and 2025 was sold at Basel this year then in 2024 there was fewer work sold in 2023 and 2024 with like that year on the painting so So things are shifting, yeah.

19:53That's so interesting. I think that price point, the danger zone price point, was also the most dominant price point at auction in 2024, although according to Artnet's data, other sales did still decline kind of 22.5 % year over year. So it is shrinking, but yeah, I think people are still buying in that price range. I think what I'm saying is it's just not necessarily the smart place to buy right now. I think some people don't care, though. I think some collectors just accept this. This is the price of the lifestyle, the gallery dinners and the glitzy participation in some of these art world events.

20:37Absolutely, or work just quite simply speaks to you. But I'm curious, from this high-end hesitation that I gleaned from Basel and my read that the downstairs floor was quite difficult this year, I wonder what you've noticed about the recalibration at the top end of the market. What was in your reporting on that? Yeah, I mean, I think at the very, very top level of the market, we started this conversation talking about how price is a bit of an abstract thing. I think like when you are way up there and you're 100 million, you know, zone, it's very abstract. You know, there are data points, but it's not grounded in any kind of like real logic.

21:16It's about, you know, confidence and I think mood. I had a great conversation with Robert Landau, who's a very respected dealer. And he is full of gems about this, very passionate. And he sort of told me it's, you know, at this level, it's about knowing what to buy. not at what price. And his whole thing is that you can never pay too much for a great painting, even if you're paying more than whatever the market tells you to pay for it, because time will always correct your mistake. The theory being that something that is great will always go up in value eventually. And he said something kind of astonishing to me about this and about kind of about mood.

21:59So he's like, this isn't about price, this is about mood. And he said, I was talking about painting he had in his back room and he was like, it could sell for anywhere between$25 million and$100 million, basically dependent on the buyer's mood. And that's a$75 million difference. It's kind of on vibes alone. So I think he kind of pushed the conversation to a little bit of a different place and to this thing about mood that you were kind of just talking about. It's interesting to hear that that's kind of what was on the ground in Basel. you know, the world being uncertain, all of the geopolitical chaos that's going on, it's disturbing.

22:39And people are kind of rethinking their values and their priorities, and they're kind of just not in the mood to buy. So that, I think, is telling. And I think, you know, there is more to what's going on here than just a fracturing of logic and pricing. It's this mood. The biggest question that I have really is how much this kind of talk about mood and the chaos of the world is potentially cloaking a more difficult reality that maybe actually there is a crisis in demand. Maybe it's not just that people aren't in the mood to buy and it's not just that prices are too high, but maybe just people don't want what's being sold anymore.

23:24And I don't think we'll be able to really tell that till some of this cloaking lifts. And sadly, I don't think the world's chaos is going to be resolved anytime soon. It's a very interesting point. I mean, it's a collector tastes are changing. How wealthy people want to spend their money is changing. And it's it deserves to be looked at. And you know what next generations they're buying patterns are as well. So I'm curious, you know, what's going on in the emerging section of the market. We haven't really spoken about that yet. Yeah, I think for galleries that are playing it smart and haven't inflated their prices too quickly, that section of the market is all of a sudden very interesting.

24:07I think collectors seem to say that they're looking in those lower price points as it's still kind of fun. You can take a risk on something pretty safely. And, you know, I think that's, although it's interesting in 2024, the auction data that Artnet has, did see that even in that kind of low or the lowest end price bracket, so works priced under 10K, there was a contraction, you know, even there. So I think it'll be interesting to see what happens there when we have like all of 2025's data and to see whether that section of the market, which I think a lot of people are saying or expecting to broaden, actually does broaden.

24:48I spoke to one emerging gallerist for my piece, and she said that she was thinking about longevity and so, you know, not playing tricks with buyers and taking that slow and steady approach. But I'm curious because your Basel coverage focused a lot on kind of the emerging. And I know you spoke to some emerging galleries on this podcast. What did they tell you about what they're doing to kind of insulate themselves right now? I think that there's a bit of a creep from the blue chip galleries into the emerging market sector that I have heard about from a few dealers. Of course, you know, if you're a blue chip gallery and you have a baked in kind of insurance policy from that branding and you're representing an emerging artist, it's much more appealing than an emerging artist at an emerging gallery, right?

25:38There's less risk there. So I think that pain is being felt a little bit as these galleries are starting to represent younger and younger artists more quickly. But I think in general, the old rules are not working anymore, as you've reported. And so I think, you know, the idea that artists' prices should just go up quickly and that's a sign of success is no longer something that people are rushing to follow. Because like a quick success like that actually is not, it's proven itself not to be sustainable in a longer term. Another thing that came up was the role of artists, like trying to discuss with artists what they should be selling their work for.

26:13They also have a voice in this that doesn't get mentioned enough. Did you touch on that in your piece a little bit or did you in your research? There was a whole sort of tangent that I could have gone off and I just didn't have space for in my piece about, you know, the role of artists in all of this. Artists do have a lot of leverage. You know, they do have, you know, a say in this. And I spoke to Marianne Boski about this in particular. and she said, you know, you do have some artists who will see kind of what's happening in the markets of some of their contemporaries. They say, oh, well, they're going up in price and they, you know, then also want to go up in price.

26:49And then on the other hand, you have other artists who are terrified of raising their prices because of this very thing that we're talking about and kind of they don't want a bubble to emerge around their works. Boski said that, you know, sometimes you do have to raise prices because there's at a certain point you know those collectors who bought early do kind of want to feel validated in their choices in some sense so they want to sort of and the market is kind of one way to when they see oh the prices went up oh I was smart to buy that you know I and that kind of is something there in the in the psychology um so I hadn't really thought about this but you know it's the gallerist really does have to to to navigate this with an artists and really persuade them that they know kind of what's right for their career as an individual artist um and i think it's a risk for the gallerist you know because if especially when artist has kind of momentum in their market they could leave i mean our colleague brian boucher recently uh wrote an article um about poaching about this the problem of poaching because you you do have something that in the art market especially in the emerging sector you have gallerists that invest a lot in kind of nurturing an artist's career and then just as soon as it starts to take off you see them kind of leaving for another gallery and the dealer Wendy Norris said something really interesting to Brian that she has started doing she started adding buyout clauses to her contracts with artists so that essentially when that happens she gets a return on her investment in kind of nourishing those artists from a young stage in their careers.

28:32So I think that's just interesting to see kind of how the market's shifting around some of these dynamics. Yeah, for sure. Hard to enforce such a piece of writing, I'm sure, in the fine print, but it's like a really important impulse in that premise. So, you know, narrative plays such an important role in all of this, as we've mentioned a couple of times, like mood is almost like the biggest decisive factor when it comes to pricing. In terms of narrative, we've had two big announcements in the past like week and a half. One is that Tim Blum is closing his gallery, making a new model of a sort, but ultimately like his brick and mortar gallery is closing.

29:11And then Adam Lindemann, who, you know, used to be a collector and became a dealer for a decade and a half is also closing his gallery. What was your read of these two events? Is there any connection to this question of like pricing chaos in your mind yeah yeah definitely I mean it's like all of what we've been talking about I'm sure it's very expensive um you know whenever you're not selling stuff uh also and there's lots of overheads I'm sure like there's a you know a bottom line question fundamentally but I mean Tim did a lot of interviews about uh his decision and And he cites burnout, you know, this kind of acceleration.