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Looking back, it’s safe to say that 2016 is likely to be remembered as a year of transition.

The political landscape was shaken up on both sides of the Atlantic with Brexit and the US election in particular creating an environment of uncertainty at various points throughout the year.

How did this affect art values? Auction results are very public and tend to offer a good indication as to the general health and trends of the market. As is often the case during transitional times, last year saw sellers at the top of the market take a bit of a step back leading to reduced supply at auction. Global auction totals at Christie’s were down 32% year-on-year, and at Sotheby’s dropped 29% (in $).

While volumes dropped significantly, this isn’t to say that individual prices were dropping too. In the first half of the year, great objects continued to make great prices; in Paris in February, a 1957 Ferrari 335 Sport sold for $35.7 million, the second highest price ever paid for a car at auction. In May in Geneva, the Oppenheimer Blue diamond sold for $57.5 million – a record for any jewel ever sold at auction. In May, at Christie’s in New York, a painting by Jean-Michel Basquiat sold to Yusaku Maezawa, a Japanese businessman, for a record $57.3 million, and in London in July, just two weeks after Brexit, a rediscovered painting by Peter Paul Rubens sold for $58.2 million.

The uncertain climate throughout the year also led to a significant reduction in auction houses offering guarantees, where a seller is offered a minimum price independent of what then happens in the saleroom. This led to an increase in works being sold in private transactions, which offer less risk and take place away from the public gaze. It was recently reported by Bloomberg that Oprah Winfrey sold a Gustav Klimt painting last year to a Chinese collector for $150 million, having bought it at auction in 2006 for ‘just’ $87.9 million, and while Christie’s auction totals dropped 32% last year, they saw a 10% increase in private sales.

Perhaps the most anticipated auctions of the year were the Modern and Contemporary sales in New York in November, which took place one week after the US election. An environment of uncertainty during the summer and autumn had resulted in a significant drop in consignments, and while the combined totals at the major auctions dropped to $1.29 billion – down from $2.33 billion the previous year – continued demand for the rarest and the best saw a Claude Monet ‘Grainstack’ painting realise $81 million, and a Willem de Kooning sell for $66.3 million – both record prices.

Of course these auction results represent an exceptionally narrow segment at the very top end of the ‘masterpiece market’. However, they also reflect a more general trend that applies at many levels of the art market: in a more considered environment there is often less supply, but demand remains fairly consistent for the best on offer. This is certainly the trend we have seen so far as we carry out our annual survey of the global art market, which is a key process of our annual updating service for valuations and appraisals, and which looks at market data for over 50 categories of art and collectibles.

This year the auction market is already showing signs of renewed confidence. Demand continues for dependable categories and for works by established artists, particularly with the continuing appeal of art as an asset class and as a safe-haven during changeable times. Meanwhile there has been an increase in supply for the first major auctions of Modern and Contemporary art taking place in spring in London, particularly at Sotheby’s, who have encouraged sellers with a greatly increased level of guarantees. Highlighting the ever-changing nature of today’s global art market, and the opportunities that spring up within it, they will offer a masterpiece landscape painting by the great Austrian artist Gustav Klimt with an estimate of £45 million; and after news of Oprah’s Klimt portrait heading from the US to China, it’s anyone’s guess where this one might go, and for how much.

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