Reframing

The art auction season is gearing up to start again and Webb’s has just released its latest broadsheet to attract lots and tout the benefits of the art market. To read it you wouldn’t think it was possible to lose a dime investing in art. This of course goes against the long-held wisdom of the art world that believes (well says anyway) you should only buy art for love and not for profit. 'We'd never dream of selling” is a commonly heard statement from art collectors (until they do). Even great collections usually find themselves on the market in the end.  Take the stellar selection of work put together by the Gibbs. It's been well published, much shown and seemed set in history, until it wasn't. In that case of course the sales have been paralleled by very generous gifting to public institutions.

Can you make money out of art? Sure you can. Should you? Why the hell not?
Here are a couple of random examples from auction records:

Colin McCahon, Let be, Let be was held in private hands for 14 years and sold for a profit of $38,000 per year for each of those years.
 
Bill Hammond, Zoomorphic lounge was held for 12 years and sold for a profit of  $10,000 per year.
 
Tony Fomison Hilltop watcher  was held for 10 years and sold for a profit of  $7,500 per year.

Michael Smither’s Family in a van was held for 26 years returning about $7,500 per year.

And these are two-times-to-the-block resales. As the Les and Milly Paris auction showed, there is also a heap to be made on first-to-auction sales probably around $10,600 a year for the 37 years they owned Gordon Walter’s painting Mokoia.

So you want to make money collecting art? OK. Buy figurative paintings. Always buy the most typical and attractive-looking works of the top-ranked artists.  And remember, there are only ever a very small number of artists who sell for high prices. Forget sculpture and ignore anything unusual. Now fly my pretties.

The price is right, or wrong, or something

Webb’s latest publication continues with its argument that statistics are the way to the hearts of collectors. Again it's Bill Hammond who wears the stat hat with a timeline of his auction prices marching through the ages, well from 1996 to 2009 at least. In dollar terms we’re talking from $326,250.00 to $322,000.00 with a work that sold for $316,250.00 in the middle. But you know statistics. At a loose end? Try putting the numbers through an inflation calculator and a somewhat different story emerges. In today's dollars the 1996 painting is Fortified Gang Headquarters and adjusted would be worth $477,324 and the 2009 painting Farmer’s Market worth $355,957. So good news for Hammond buyers, though maybe for investors, not so much. In its next auction Webb’s have a classic 1996 painting Searching for Ashburton on the block with an estimate of $220,000 - $280,000. Sounds pretty impressive but go in reverse and put it into 1996 inflation adjusted figures (have these people nothing better to do with their time?) and you're looking at $150,000 to $190,000. You can play games with inflation here on the Reserve Bank site.

Last post

Ok we've done a whole heap of Hammond lookalikes (well people with bird heads) and it's time to stop, but what better way to go out than with this great one from Istanbul.

Other OTN Hammond lookalikes:
Egyption edition
New York
Book of birds
San Francisco
Green bean edition
At the movies
Street art, Wellington
Plague doctor Bill

Channeling Bill Hammond...

... in New York

By the numbers

The battle of the auction houses is up and running for a new year. Webb’s is publishing another of its mags showcasing results achieved and also previewing some of the star attractions for its first high-end contemporary outing at the end of March. No doubt Art + Object will be close behind. Webb’s top 10 prices for last year once again contradict all those who say art isn’t close to a predictable investment. The first six for instance are typical figurative paintings of well-known male artists all of whom have been setting auction records for years. There is only one abstract work in the list, Ralph Hotere’s banner work Vidyapati’s song at spot number 7.

The first and only woman in the list is Evelyn Page (go figure) but this year Webb’s seems to be pushing another female presence into the arena. That would be the artist known as Lillian Budd whose installation Modern world (a key work in the 1992 Headlands exhibition) is estimated in the first 2014 catalogue at between $50,000 and $60,000. This is a huge jump from the prices usually attached to experimental work of this kind even when its provenance is as good as this one. If Webb’s did achieve its estimate it would certainly bring new life to the market and bring NZ into line with overseas auctions that have been foregrounding contemporary work of this kind for a good while now.

Watch the birdie

As part of the run-up to its next big art auction, Webb’s have published an outsize brochure on its major attraction Bill Hammond’s Farmer's Market. Webb’s are hoping to get between $300,000 and $350,000 for this painting (achieving the lower estimate plus commissions would create a new auction record for Hammond) so it's being given a big push.

However unlike most of the other 15 works by Bill Hammond that have fetched over the $100,000 mark in the last decade, Farmer's Market is just four years off the easel. So how do you calm the horses over the traditional fear of later works (the average age of the last decades big dollar offerings is just shy of 11 years old).

Webb’s have done it by coupling critical and art historical remarks with detailed analysis of sales performance creating a new ‘period’ for the work on the block to slip into, 1999 to 2009. Until this year most of the high priced Hammonds at auction were painted between 1995 and 1998. Farmers market, being painted in 2009, is of course the bleeding edge of this follow-up period.

Selling paintings that are all but fresh from the studio is more commonplace than it used to be (the Cotton in this auction is also a recent painting). And there is a precedent with Hammond, an even ‘wetter’ work, the three-year-old Whistler’s mothers, sticks and stones was hammered down for around $135,000, but that was 10 years back.

It wasn’t that long ago that it would have been unthinkable to frame up major paintings as financial assets in this way. Accumulated auction prices were hard to come by so accurate indexing was virtually impossible. A lot has changed. Most auction houses (there are a few exceptions) are very sophisticated in presenting art as analysed by its dollar value compounded with the construction of complex comparisons. The shame in all this is not that some art is seen as a cash cow but that the producers don’t share in the spoils.

Unsurprisingly it was the wealthy that squealed loudest a few years ago when a measly 5 percent was proposed as an artist payback from profits at auction. The idea died without a whimper. Hammond alone has put more than two million bucks back into the pockets of collectors over the last ten years and six million over his auction career. For his trouble he'd be lucky to have got so much as a box of chocolates, let alone flowers. Very lucky.