PAI’s The week in focus: Where’s the value in nostalgia?


Flower power: Gustav Klimt’s Bauerngarten sold for £48m at Sotheby’s in London last March.

“Nostalgia”, as they jokingly say, “is not what it used to be.” That, perhaps, helps sum up the international art market of this past year – a year in which a handful of price records were set for a few artists, but a year in which the market as a whole recorded something of a downturn. It was a year in which sales of works by some of the renowned old masters, of the impressionists, of the modern artists and of the contemporary artists hit the headlines. But it was also a year in which prices that failed to reach estimates were swept under the news carpet.

To gain an initial understanding of how some records were broken, take  a look at the year-end edition of Antiques and the Arts and its headline ‘Records were made to be broken.’ There, they listed, an eclectic number of pieces knocked down for as much as  10 times their pre-sale estimate.  

But there was more to the record-breaking end of the market. As Reuters, the BBC, Artnet and others report, in March, Gustav Klimt’s Bauerngarten (Farmhouse Garden) sold for £48m at Sotheby’s in London – reportedly the third-highest price ever paid for a painting at auction in Europe. At the same sale Picasso’s Tomato Plant reached its pre-sale high estimate of £17m and Oskar Kokoschka’s Orpheus and Eurydike sold for £3m, virtually twice the price the seller had paid for the work in New York in 2010.

Sellers’ commissions and buyers’ premiums

If we ignore sellers’ commissions and buyers’ premiums that’s an annual compound growth rate of 8%. Taking the selling and buying costs into account, the seller was largely retaining wealth. All of this was headline-grabbing news, but tucked away in reports on the Sotheby’s March auction was the fact that Edgar Degas’s pastel of a Woman’s Back was knocked down for less than the £6m pre-sale estimate. Perhaps that was no surprise, the work had failed to sell at its reserve price in an earlier auction and had only been offered in London at a lower reserve in March.

Nationalistic flag waving or whatever, as The Art Newspaper reports these days New York far surpasses London for auction records. Back in May Claude Monet’s Meules was knocked down at Sotheby’s for $110m, the highest price paid for a painting all year. But that sale, the last with spectacular prices before something of a decline set in ahead of mid-year, wasn’t a complete slam dunk even if it was at the height of the year’s excitement.

The year’s second highest price

The day before, at Christie’s Jeff Koons’s Rabbit sculpture fetched the year’s second-highest price of $91m – and there were others. But then there was William Bouguereau’s Youth of Bachus, a work with more male and female naked flesh than virtually any other known painting, offered at Sotheby’s in May at an estimated price of between $25m and $35m. Bidding stalled at $18m, well below the reserve price, and the painting was, in auctioneers’ language ’bought in’. Are art buyers becoming prim as the global economy enters unknown waters?

As 2019 was drawing to its close, a question being asked was: “What new styles or schools offer the best opportunities for profit?” If that sounds crass, it’s not intentionally so. But those investing with an eye to prices more than a couple of decades ahead need to be aware of growing trends. Take the reports by Art Critique and Artnet on the Sotheby’s early-December sale of Australian Aboriginal art in New York. That’s trying to introduce the style to buyers in America – a genre that has been promoted with varying success over the years in Europe and in its homeland, Australia.

Aboriginal art might scarcely be mainstream, but it is perhaps down the mainstreams’ tributaries that tomorrow’s greats will be found. One is that of young, modern artists – the generation reported by Mutual Art. It chooses as an example the works of three young Belgians, each investigating modernity through the lens of traditional painting.

What was that we were saying about nostalgia?