Art Experiences First Period of Stabilized Returns Since 2011

Average Return on Art in the First Half of 2017 Remains Consistent Compared to Prior Year

Contemporary Art Leads the Market Posting Highest Returns

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Aug 07, 2017, 12:10 ET

NEW YORK, Aug. 7, 2017 /PRNewswire/ -- Following the close of the first half of the year on June 30, 2017, Sotheby's (NYSE: BID) conducted a review of works sold by Sotheby's and Christie's at auction during the period. According to Sotheby's Mei Moses database, the average compound annual return (CAR) on art sold at auction in the first half of 2017 remained consistent compared to prior year, the first period of stabilization since 2011.

According to Sotheby's Mei Moses database, the average and median returns on art sold in the first half of 2017 stabilized versus the full year of 2016 based on a rise in the average and median returns on sales of Contemporary Art.

Conversely, the average compound annual return on contemporary art sold in the first half of 2017 accelerated sharply compared to the same period in 2016 from an average of 7.4% to 9.0% (median: from 6.4% to 7.0%). Artists including Jean-Michel Basquiat, Willem de Kooning and Josef Albers posted particularly strong results above the average return.

"Sotheby's Mei Moses provides us with proprietary data that clarifies anecdotal 'hunches' about how the overall market is performing and the level of specific artists' markets," commented Amy Cappellazzo, Chairman of Sotheby's Fine Art Division. "The stabilization of returns for all art and the acceleration in those for contemporary art affirms the increasing confidence we have felt in the marketplace in recent sales, which is good news for those looking for additional data to factor into their decision to consign."

The average compound annual return for Impressionist & Modern Art showed a modest increase from 3.8% in 2016 to 4.0% in 2017, while the median was down 0.6% (from 3.0% to 2.4%), indicating there were individual works of art with particularly high percentage returns sold in the first six months of the year. The average realized compound annual return for Old Masters declined from 0.3% in 2016 to 0.1% in 2017 (median: 0.4% to – 0.4%).

Sotheby's Mei Moses database, among other things, enables one to calculate the compound annual growth rate between two selling prices for a given piece of art. The returns on art for a period of time are calculated by looking at all art sold that is in the database (i.e., it has been sold before at Sotheby's or Christie's since 1810) and then calculating the average annual percentage return for each object that has been sold in the past year. In order to protect against individual works of art with particularly high percentage returns having an out-sized effect, the index looks at both the average and median returns and comes up with the average of averages. However, the median return rate for the sample is also included. The size of each of the samples referred to in this press release suggest a high likelihood of statistical significance.

About Sotheby's Mei Moses (SMM)
Sotheby's announced the acquisition of The Mei Moses Art Indices in October 2016. Based on approximately 49,800 repeat sales from 1810 – present, Sotheby's Mei Moses (SMM) uses the purchase prices of the same painting at two distinct moments in time (i.e., repeat sales) to measure the change in the value of unique works of art. SMM is the financial industry's preferred instrument to compare the investment performance of art as an asset class, identify trends and internal dynamics of the market and understand the market's relationship to broader economic and societal factors. SMM provides Sotheby's with unique access to an analytic tool that provides objective and verifiable information to complement the world-class expertise of the Company's specialists.

About Sotheby's
Sotheby's has been uniting collectors with world-class works of art since 1744. Sotheby's became the first international auction house when it expanded from London to New York (1955), the first to conduct sales in Hong Kong (1973), India (1992) and France (2001), and the first international fine art auction house in China (2012). Today, Sotheby's presents auctions in 10 different salesrooms, including New York, London, Hong Kong and Paris, and Sotheby's BidNow program allows visitors to view all auctions live online and place bids from anywhere in the world. Sotheby's offers collectors the resources of Sotheby's Financial Services, the world's only full-service art financing company, as well as the collection advisory services of its subsidiary, Art Agency, Partners. Sotheby's presents private sale opportunities in more than 70 categories, including S|2, the gallery arm of Sotheby's Global Fine Art Division, and two retail businesses, Sotheby's Diamonds and Sotheby's Wine. Sotheby's has a global network of 80 offices in 40 countries and is the oldest company listed on the New York Stock Exchange (BID).

*Estimates do not include buyer's premium. Prices achieved include the hammer price plus buyer's premium and are net of any fees paid to the purchaser where the purchaser provided an irrevocable bid.

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SOURCE Sotheby's