The Art of Valuation

Valuing fine art can seem like an arbitrary and unpredictable business. However, there are three main factors to consider when preparing a contemporary and modern art valuation, or appraisal. Art valuers must consider trends in the international auction market as a whole, the status of a particular artist within his historical context, and the scarcity and place of the individual work within that context.

The first factor to consider when valuing artwork is the international auction market and the trends that are visible there. This means keeping track of the auction results which reflect the demand from buyers. For example, the Post War and Contemporary Art sector has been consistently strong over the last decade, making household names of regular record breaking artists such as Jean-Michel Basquiat, Roy Lichtenstein, Francis Bacon, Gerhard Richter, Yves Klein and Lucian Freud. The growth in buyers from a new middle class Chinese market has also fueled the recent demand for contemporary Chinese art. Artprice released its annual list of the world’s top artists at auction at the end of 2011 and revealed that Picasso (who had previously had the top spot) had been replaced by two Chinese modern masters who were largely unknown in the West: Zhang Daqian (1899–1983) and Qi Baishi (1864–1957) and China accounted for 41% of the world auction market.

The second factor is the international stature of artists, often linked to shows in key museum exhibitions around the world. For example the recent show of David Hockney RA: A Bigger Picture at the Royal Academy of Arts in London resulted in a fresh interest in his new work, as well as a renewed interest in his iconic pieces from the 60s and 70s. Similarly, Damien Hirst and Edvard Munch: The Modern Eye at Tate Modern prompt a fresh critical and commercial view of these artists. In western markets, private galleries and dealers also have a symbiotic relationship with what is going on in museums and auction houses, therefore they might combine forces for events such as Master Paintings Week so galleries such as Philip Mould or Johnny Van Haeften will have exhibitions to coincide with the Christie’s and Sotheby’s Old Master Paintings auctions.

A further indicator of value is the scarcity of a piece of work, and the place it has in its historical context. The provenance of a work is often vital here, as being part of a specific collection can be key to value. For example, Yves Klein’s Le Rose du bleu (1960), which recently sold for £23,561,250 (a world record price for a French post-war artist at auction) was previously part of the renowned Madeleine Everaert and Menil collections and was included in all the artist’s major exhibitions over the past 50 years. Francis Bacon’s Study for Self-Portrait (1964) recently sold for £21,545,250 as it was one of only twelve, floor-length self-portraits ever to be made by the artist. Following Lucien Freud’s death in 2011, and subsequent exhibitions such as Lucian Freud Portraits at the National Portrait Gallery in 2012, any portrait by Lucian Freud coming up at auction such as will have an undisputed scarcity and place in history.

Whilst an art valuation or appraisal may not always be dealing with household names or record breaking prices, the principles remain the same. Only if trends at international auctions, the international stature of the artist, and the specific context of a particular work are taken into account, can an accurate art valuation or appraisal be achieved.

Isabel Grimshaw
Art Valuer