As many of our clients are watching their retirement nest eggs and their home values decline, some are considering the sale of art and antiques as a means of generating cash flow. Coincidentally, others, at the same time, consider buying art and antiques as an alternative investment to other financial market-based vehicles.
So, who is the benefactor from this dichotomy? The sellers, in this case, are concerned about falling prices and lessening demand, while the buyers turn to the auction market for a potential ‘bargain’ on an item which they feel may have better investment potential than their 401K. Therefore, we have a seller base that is reluctant to sell to a buyer base that is actively seeking out fine art and antiques. In the standard supply-and-demand equation, both parties would then be enacting a textbook example of market-based valuation.
Why then, are some antiques and art devalued in the current marketplace? Simply, a cultural paradigm shift has occurred from the previous generation of art and antiques buyers to the current. Many factors have affected this shift, most notably the busy lifestyles that are now the norm in social interaction. No one has time, nor the desire, to have an entire room in their home devoted to the accumulation of antique furniture that belonged to Grandma and Aunt Mae, who loved and cared for these items based on their memories of these things as survivors of the Great Depression, just as Grandma and Aunt Mae’s generation were. Late baby-boomers and early ‘gen-x’ers’ have not endured the pain and struggle of a devastated economy and place little significance on items which may represent a triumph over struggles related to job losses, wiped-out savings accounts and the migration of extended families to live under one roof.
To many of our parents and grandparents, satisfaction was gained by the assemblage of a large collection of antiques as trophies, symbolizing their victory over troubled times and becoming a shrine to their ability to overcome adversity. Others accumulated the things they saw in early life as only being the articles available to the wealthy, which, at the time, seemed unattainable.
Today’s generation of art and antiques patrons has eschewed this accumulative mentality in exchange for an appreciation for quality. During the 1980’s and 1990’s the ‘car-load’ of purchases acquired at the auction used to be the source of pride. Today, the high-quality, single item purchase yields the same amount of satisfaction for the buyer.
And, we come to the point. The greatest impact on the value of art and antiques is not, in fact, the state of the economy (although certainly a factor), but the shift in the tastes, desires and decorating styles of today’s buyer.
Gone are the days where a marble top, Eastlake Victorian washstand would sell for $500-$600 at any auction. Victorian furnishings, especially the later Charles Eastlake designs, are out of favor among decorators and homeowners, and have been selling sub-$200 for over two years in our region. Gone also, are the days when antiques dealers would spend days traveling to surrounding states to acquire items from various auction houses. Most auctioneers today post the majority, if not all their items, on web catalogues for pre-auction preview, and speculative buyers can make a bidding decision based on a quick web-site search of all prospective auctions for a given day.
The other major factor affecting today’s values, especially those of items categorized as collectibles, is the pervasive nature of the internet. Items that used to be considered rare have now become common. For example, in the early 1990’s, bidders from surrounding states would travel to our auctions to buy Hummel figurines, if we offered a large collection. As of this writing, there are over 4,200 Hummel listings on eBay. Rare? Not so much… Combine the current over-supply with the fact that Hummel figurines were primarily cherished by family and friends of soldiers who served in the European theater in WWII as memorabilia from their travels, a group that is not actively collecting today, and you have a recipe for a deep decline in value.
To summarize, the current market for high-quality antiques and art which compliment current design trends is good, even great, for some items. Conversely, antiques that are out of style or are a mid-level quality item in any category are finding smaller markets, due in large part to a shift in buyer demand, and in much smaller part to a sluggish economy.
Is resurgence in sight? Will a cultural shift occur in our lifetimes that will bring buyers back to the auction seeking Victorian furniture, cut glass or pie safes? No one can tell. Suffice it to say, as we have always counseled our clients, the time to sell is when you are ready to sell. Speculative selling or buying is a risky business, and the subject of a much longer discourse. As we have adjusted our business to reflect changing buying habits, some items which used to be a staple of our offerings are now being referred to other auction houses which may represent a more willing clientele.
Our affiliation with Artfact/Invaluable makes our catalogues available to a paid subscription database of art and antiques buyers from all over the world. Although currently climbing, the US dollar’s low value against other world currency has generated international interest in American antique auctions. Now, can you speculate how many online buyers from the United Arab Emirates are going to be interested in having a $75 piece of Roseville pottery shipped from across the globe? But, how many international bidders might find competing for an original Italian Art Renaissance painting worth the effort?
See you at the auction!