Where have all the Brits gone? That’s what galleries were asking at the Frieze Art Fair in London, held at the beginning of the month. French, German and American visitors were all overheard, says James Tarmy on Bloomberg Pursuits, but “British accents were far and few between”.
There’s no great mystery as to why that was, of course. The plunging pound has made it comparatively more expensive for home-based buyers in a global market where many artworks are priced in dollars. Still, while overseas collectors continued buying, “the first day of the fair was busy but lacking in the kind of heady frenzy of years past”, says Tarmy. It’s not just the Brits; the wider market has also quietened.
Globally, art sales peaked in 2014 when they totalled $68.2bn after years of breakneck growth. A year later, sales fell by 7% and the decline has picked up pace this year. That’s left not only collectors worried, but also equity investors, who see the art market as a bellwether for the global economy, says Michelle Celarier in Fortune magazine. It’s not exact, but the art market does “correlate strongly with more important indicators, particularly stocks and oil”. Or to put it another way, if “the oil barons are sitting on their auction paddles”, that may not bode well for equities.
So with the autumn season now under way, “the skittish art market is facing a series of stress tests in the world’s major art hubs”, says Kelly Crow in The Wall Street Journal.
The Frieze Art Fair was one, while Sotheby’s in Hong Kong held a series of high-profile auctions a fortnight ago. That brought in $282m – above the low estimate of $260m, but a “far cry” from the more than $400m of five years ago. Next up is New York where Sotheby’s is hoping to raise $9m from the sale of David Hockney’s six-panel Woldgate Woods, 24, 25 and 26 October, 2006, on 17 November – seen as a “fresh test of the painter’s appeal”, says Crow.
One crucial factor in the slowdown is China. In recent years, ever more money has been flowing into the art market from Chinese buyers – but they have become less willing to spend as a result of the country’s economic slowdown. Hence hopes of a quick pick-up in the art market rest largely on stronger growth there – or at least improving sentiment.
On that front, optimists will note that there are clearly still some Chinese collectors with deep pockets. Sotheby’s biggest transaction of this year was the sale of Jenny Saville’s painting Shift to the founders of Shanghai’s Long Museum for $9m – triple the pre-sale estimate. Nor has it gone unnoticed that Chinese billionaire businessman Chen Dongsheng became the largest shareholder in the same auction house last summer, with a 13.5% stake.
“If his investment is a sign that China’s elite are regaining confidence in their economy, that could be good news for the art market all around,” as Celarier puts it. If they’re not, however, the key question at art sales in October and November will be not “where are the Brits?”, but “where are the Chinese?”