Kathryn Tully spoke to Michael Moses to get his famous matched pair data for last week’s sales:

 The average compound annual return on the repeat sales during these auctions was 10.4%. ‘This was a really strong set of sales,” says Moses. “They don’t get much stronger than this. Nor were there any really outsized returns that would skew the results.” […]

It’s also worth noting that repeat sales information was only available for 130 or 12% of the total number of lots offered in these auctions. To put that in perspective, a total of 241 art works or 22% of the lots offered in these sales didn’t sell at all.

Of course, there’s s difference between the overall return and the rate of return as illustrated by the lot that had the highest percentage return but didn’t account for much in the way of money:

The art work that generated the best compound annual return for its owner of 64% was Alexander Calder’s work on paper, Cap d’Antibes, which also sold during Christie’s day sale last week. That was purchased in September 2011 at Sotheby’s for $53,000, above the estimate of $25,000 to $30,000. It sold again at Christie’s last week for $111,000, plus buyer’s premium, again way over the estimate.

Moses says that the fact that the Calder sold for way over its high estimate twice in a row is very unusual. “Our data shows that the higher you pay above the estimate, the more likely you are to make lower returns,” he says. […] According to Moses, sellers of art works during the New York’s contemporary sales last week that had spent over $1 million on those purchases initially achieved a lower return. “The average compound annual return for works with a purchase price of greater than $1 million was 7.1%, while for those with a purchase prices of less than $1 million it was 10.9%. Again, masterpieces under perform,” says Moses.

Basquiat, Pollock, Lichtenstein: Are Trophy Art Works Good Investments? (Forbes)

Bloomberg’s Scott Reyburn reveals that Sotheby’s is expanding its private selling facilities. This time its going to be in London:

The company has taken an undisclosed amount of space in a five-story block at 31 George Street, opposite the back entrance of its New Bond Street auction rooms, the company said in an e- mail. A person with knowledge of the matter had told Bloomberg News that it would open a retail space in the U.K. capital.

The 1980s steel and brick building, incorporating a ground floor gallery, will be dedicated to hosting private selling exhibitions, Sotheby’s confirmed today. Billionaires often prefer buying big-ticket items through unpublicized private sales rather than in the glare of competitive public auctions.

Sotheby’s Boosts Private Sales With New Gallery Plan (Bloomberg)

The different contrast between the two markets in New York is clearest at the top end, where only one earlier work, a still life of apples on a table by Cézanne, comparable to any of his highest-selling still-life paintings, is estimated at $25 million. In the contemporary sales there are seven $25 million plus paintings including works by Francis Bacon, Gerhard Richter, Barnett Newman, Jean-Michel Basquiat, Jackson Pollock and Roy Lichtenstein. […]

At the same time, however, charts compiled by market analyst Robin Duthy show that while prices at the top end of the market continue to rise, the middle and lower orders have seen falls. The shadow of the Japanese speculative bubble of the late Eighties still lingers. A radiant, symbolist still life by Odilon Redon at Christie’s, estimated at $500,000, sold for nearly double that amount in 1990. A reclining nude by Japanese favourite, Renoir, cost $2.3 million back in 1989, and is now estimated at $800,000. While prices remain this subdued, supply will continue to be a problem.

Art Sales: New York Braced for $1bn Art-Spending Spree (Telegaph)

How does the tiny Geneva auction house, Hôtel des Ventes, do so well having built up sales from 1m Swiss Francs in 2004 to 22m Swiss Francs in 2012? The International Herald Tribune asked the not-so-new owner, Bernard Piquet:

“Compared to many arts merchants, I have no conflict of interest because I never buy anything myself,” he said. “You have to be very strict about what you do.”

He cited, for example, a Chinese sculpted rhinoceros horn that he had spotted while visiting a Geneva apartment. The owner, whom Mr. Piguet would not identify, believed the horn could be useful as an ashtray. “If I had just given her 500 Swiss francs that day for it, she would have been more than delighted,” Mr. Piguet said. Instead, he persuaded the owner to put the horn up for auction, and it sold for 300,000 Swiss francs in March 2011.

That sale led to a series of referrals, which Mr. Piguet views as crucial to the business. “It’s also about building up relationships that help your profitability in the long term,” he said.

Central to that profitability is the 20 percent commission that the Hôtel des Ventes charges, and its high selling rate — it has sold about 90 percent of what it has auctioned in recent years, at an average of more than 1.5 times estimates. “We’ve deliberately remained very conservative in our estimates,” he said.

The Hôtel des Ventes offers no guarantees as to the accuracy of its sales catalog

Small Geneva Auction House Makes a Comeback (International Herald Tribune)

Katherine Markley asks some big questions about women artists, their market success during recessions and the potential for parity with male artists:

Although many artists did experience a significant drop in total sales volume in 2009, as the overall art market responded to global financial crisis, many female artists were able to quickly rebound, as the Post-War and Contemporary market saw consistent growth in the past two years.

Markley points to the success of Yayoi Kusama and Cindy Sherman (against Gerhard Richter and Andreas Gursky) as their price indices continue to rise ahead of the market and male rivals. As interesting as these graphs are, it is hard to determine whether these particular women are representative of anything beyond their own success.

The Success of Top Female Artists (Artnet)

A site for financial advisors summarizes the latest Mei Moses findings by suggesting that art returns are getting smaller, especially for works of recognized value. Using their sale pairings, Mei Moses have found that although the average price of sales tracked was  $518,910, “the median price was only $63,718.” And that “Sales for less than $50,000 provided mean returns of 7.48% with a standard deviation of 17.23%.” While “Sales between $500,000 and $1 million, in contrast, generated returns of 5.51% with a standard deviation of 10.93%.”

In other words, buyers took on greater risk to goose their returns from 5.5% to 7.5% which is hardly head-turning even in a low-interest-rate environment. Worse for art investors, reaching for return often backfired when works failed to sell:

Mei Moses also examined 1,487 repeat sales pairs for artworks that were offered but did not sell in 2011 and 2012. Although many of the price statistics between sold and unsold objects were similar, the firm notes that a key difference in the pre-sale price ranges.

“However when you come to the average expectation of the two owner groups (sold and unsold), we see that the works that did not sell had a mean return expectation three times that of the works that did sell,” the firm says in a recent report.  “Therefore on average setting a return expectation too high reduces the likelihood of a positive outcome for the owner of the art.  This is a fact that is replicated in our full database.”

How Do Art Returns Compare to S&P? (Advisor One)

Jerry Saltz, in his inimitably self-absorbed way, wrestles with the changes brought upon the art world (gallery system) by the dramatic success of Contemporary art. Pinioned between his envy of (and contempt for) the rich and his desire to see a democratic distribution system for artists and their work, Saltz eventually works his way to an interesting place. You’ll have to read the essay itself to get there. In the meantime, Saltz sets the scene admirably here:

The clustering of hundreds of galleries in several neighborhoods has meant that a huge swath of the art world is continually being presented at our doorstep. That is changing, and changing fast. These days, the art world is large and spread out, happening everywhere at once. A shrinking fraction of galleries’ business is done when collectors come to a show. Selling happens year-round, at art fairs, auctions, biennials, and big exhibitions, as well as online via JPEG files and even via collector apps. Gallery shows are now just another cog in the global wheel. Many dealers admit that some of their collectors never set foot in their actual physical spaces.

The beloved linchpin of my viewing life is playing a diminished role in the life of art. And I fear that my knowledge of art—and along with it the self-knowledge that comes from looking at art—is shrinking.

Artists and dealers are as passionate as ever about creating good shows, but fewer and fewer people are actually seeing them. Chelsea galleries used to hum with activity; now they’re often eerily empty. Sometimes I’m nearly alone. Even on some weekends, galleries are quiet, and that’s never been true in my 30 years here. (There are exceptions, such as Gagosian’s current blockbuster Basquiat survey.) Fewer ideas are being exchanged, fewer aesthetic arguments initiated. I can’t turn to the woman next to me and ask what she thinks, because there’s nobody there.

Saltz on the Death of the Gallery Show (New York Magazine)

Among the charts in Artprice’s new report on the art market in 2012 is a breakdown of auction sales by house. This one focuses on the West and shows the diverging strategies of Christie’s and Sotheby’s as the two firms display differing strategies toward future growth and profitability.

The full report can be found here.

Clare McAndrew teases the high points of her TEFAF Art Market Report in The Art Newspaper. Her conclusion? Art is tied to economic growth around the world. Though when she talks about polarization, only one pole is mentioned:

Poor and variable economic growth along with political uncertainties encouraged investors to retreat to the safest and most low-risk areas of many asset markets over the past year, such as bonds and blue-chip stocks. In the art market, this was exemplified by cautious buying and selling in many areas leading to a strong polarisation of the market, with the best performance seen at the top end of the best quality works and the most well known artists.

US Retakes Top Spot in Art Sales from China (The Art Newspaper)