A recalibrating auction market, an
increasingly global ecosystem and evolving wealth management
strategies present opportunities and challenges
NEW
YORK, Nov. 12, 2024 /PRNewswire/ -- Newly
released Bank of America art market update finds that lower
auction estimates, discounts at galleries and the recent interest
rate cuts are driving increased participation among collectors
heading into marquee events, including the New York fall auctions and Art Basel
Miami. The anticipated favorable buying conditions come on the
heels of lower-than-expected art sales in the secondary market
during the first half of the year – with auction prices coming in
only 1% above their aggregated mid-estimates, the smallest increase
in seven-plus years.1
The current market correction, which began in 2023 with global
geopolitical unrest, high inflation and interest rates affecting
collectors, has spilled into 2024. Less marquee estate property in
the May sales potentially also dampened bidders' confidence and
enthusiasm. Fewer masterpiece works are being offered in what has
widely been viewed as a "buyer's market."
Galleries face a critical choice: adapt to the new market
reality or risk accumulating unsold inventory. "Collectors are
more discerning than ever," said Drew Watson, Head of Art Services at Bank of
America Private Bank. "They know that galleries continue to
sell A+ works, but that terms are more negotiable on everything
else. Collectors are using that knowledge to secure more favorable
transaction terms: including skipping waitlists, eliminating resale
restrictions and 'buy one gift one,' and of course, price
discounts.
While some auction prices soften and bidder competition wanes in
some areas of the market, the report indicates strong collector
interest in certain collecting categories, for example, the Latin
American (LATAM) and Latin diaspora artists market, which is
expected to carry into 2025. Sales in this sector have grown by 18%
year over year and show no signs of slowing based on recent
market activity and institutional support.2
"Latin American artists have seen strong buyer interest and
sell-through rates so far this year," Watson said.
"We saw multiple record-breaking auction sales in the spring,
and biennales and art fairs have become key primary market
platforms."
Report findings also show that collectors increasingly view art
as an asset that is part of their overall wealth management
strategy. By 2026, the estimated value of art and collectibles is
expected to surpass $2.8 trillion and
make up approximately 11% of the portfolios of ultra-high-net-worth
individuals.3 Interest is only expected to grow as
younger generations build and inherit wealth over the coming
years.
Access the full Art Market Update Fall 2024: Opportunity Knocks?
report to read more about evolving trends in the art market today,
including key wealth planning insights, an in-depth interview with
artist Amanda Phingbodhipakkiya, a discussion with Jennifer S. Brown, curator of Bank of America's
corporate collection, and a look at the Bank of America Art
Conversation Project (ACP).
Since 2010, the ACP has helped conserve over 260 critically
important paintings, sculptures, archeological and architectural
works in danger of deterioration. More information about this
year's recipients can be found here: Grants to Preserve Historic
Art Awarded in 11 Countries by BofA.
Bank of America
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States, its territories and more than 35 countries. Bank of
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Reporters may contact:
Julia Ehrenfeld, Bank of America
Phone: 1.646.855.3267
julia.ehrenfeld@bofa.com
1 ArtTactic, "RawFacts Auction Review First Half
2024."
2 The Art Basel and UBS Global Art Market Report
2023.
3 Deloitte Art and Finance Report 2023.
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SOURCE Bank of America Corporation