art auction setting for Vincent van Gogh

Art World Explained: Understanding Art Auctions

July 26, 2023 Gavin Coates

The art world is a thriving and global industry, with annual art sales estimated to be between 60 to 70 billion dollars.

An art auction or fine art auction is the sale of art works, in most cases in an auction house. It's a public event where unique and valuable artworks are sold to the highest bidder. Online platforms have made auctions more inclusive and accessible.

people admiring van Gogh's Sunflowers at its home after it was at an art auction

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One of the most exciting aspects of the art market is art auctions, which account for about 20% of the total sales. Art auctions provide an opportunity for art lovers and collectors to acquire valuable artworks at market prices. However, for many, auctions can be intimidating, so let's demystify the process and explore how art auctions really work.

1. Accessing Auction Information

Auctions are public events, open to anyone interested in viewing the artworks on sale and participating in the bidding process. Prior to the auction, auction houses publish online catalogs with images of the artworks, historical information, and estimated prices. Potential bidders can access these catalogs several weeks before the auction, giving them time to do their research and understand the pieces they are interested in.

2. Homework and Art Expertise

Before registering to bid, it's essential to do some homework. Study the online catalogs, learn about the artists, and gather information on the artworks' historical significance and provenance. Auction houses often employ dedicated specialists who can provide guidance and advice to potential buyers. Don't hesitate to ask questions about how the artwork's estimate was determined and the level of interest from other bidders.

Independent art advisors are also available for consultation. They can walk you through the catalog and offer additional insights, or you can visit the presale exhibition to experience the artworks in person. Ultimately, buying art should be driven not just by investment potential but also by emotional resonance and appreciation for the artist's genius.

3. Rarity and Scarcity

Every piece of art is unique, and rarity and scarcity play a significant role in determining an artwork's price. The fact that there is only one of each artwork in the world drives the value, and the emotional connection a collector feels to the artwork further motivates the desire to own it. Rarity and scarcity are key drivers of price in any economic model, and they apply especially to highly sought-after works by renowned artists.

4. Art Auctions Through History

Art auctions have a rich history dating back to the 17th century. The early auctions involved pricing each object and inviting potential buyers, but the public auction format brought more excitement and competition. Over the years, auctions have witnessed remarkable sales, such as the historic auction of Murillo's "The Immaculate Conception" in 1852, which set a record for the highest price paid for a work of art at that time. Today, records continue to be broken, and art auctions have become a platform for generating record-breaking sales.

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5. 21st Century Art Auctions

The 21st century has witnessed significant changes in the art auction landscape, with the advent of online bidding transforming the way auctions are conducted. Major auction houses like Christie's and Sotheby's expanded their reach and inventory through online platforms. This shift has made art auctions more inclusive and accessible to a broader audience, including contemporary artists. The influence of collectors from Asian markets, such as China, has grown significantly in recent years.

buying an artwork at a live auction

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Art auctions offer a thrilling opportunity to acquire unique and valuable artworks. With access to online catalogs and the guidance of art experts, potential bidders can approach auctions with confidence. The emotional resonance and appreciation for an artwork's rarity and scarcity motivate collectors to invest in art that moves them. As the art market continues to evolve, art auctions remain a dynamic and exciting part of the art world, shaping the history and value of art for generations to come.

studying historically significant artworks selling on art auction