Timing matters too. Bowling recommends checking an artist’s CV for consistent output and recognition. “Have they been working every year?” she asked. “Or has this person not done anything since 2012?” Levin suggests waiting and watching an artist mature for a few years before buying something, to see if the work continues to evolve. “It’s better to spend the $25,000 when you are a little more comfortable with the market variables than taking the chance at $10,000,” he said.
Another factor to consider is where the art gets sold. Galleries price works according to the size of the work, the success of the most recent show, and any other relevant career-related variables, such as a recent institutional show or a nomination for an award, said Bowling, who spent seven years at Andrea Rosen Gallery before joining Phillips. In addition, galleries try to keep the prices for their artists on a steady upward trajectory, rather than riding the highs and lows of the broader art market as auction prices more often do. By contrast, auction estimates usually account for buyers’ tastes and appetites, as well as where the art market is in its cycle. “I have to think about many people it will appeal to, how many bidders, how that competition is going to drive up the price, and base my estimate range on that,” she said.
While Bowling describes herself as “the biggest proponent of the gallery system,” she said the straightforward nature of auction pricing can be a great entry point for new collectors. “I think there’s something appealing about the auction environment,” she said. “Here’s the estimate range, we have an auction, and people bid against each other. That’s how the price is achieved.”
Bowling, Campbell, and Levin all stressed one thing: Collectors shouldn’t treat art like a financial investment. (That’s even, and perhaps especially, the case for those who work in financial services, who often cite headlines of multi-million-dollar prices achieved at auction.) Since most art works do not increase in value, Bowling suggests finding a risk threshold, and buying within those limits. For one collector, that might be $3,000, or, for another, $3 million. “Find that threshold you’re comfortable with losing or gambling on,” she advised, “and if you go beyond that level, do more research.”
Levin goes further. He recommends assuming the price for a work by a new artist will go to zero after, say, five years, much as a dining set would lose most of its value over a similar time frame. If that work cost $5,000, or $1,000 a year, it works out to a cost of roughly $3 a day. “Is the piece going to give you $3 of pleasure a day?” he asks. If it does, “then it’s worth what you paid for it.” And that, he said, is the point of buying art.
“If you want to buy stocks,” Levin said, “you can just hang bags of money on the wall.”