Value of an artwork

How does one determine the value of a piece of art accurately? This is perhaps one of the most frequently asked questions by art collectors or individuals interested in starting a collection. It’s easy to see why; the value of art fluctuates often. As such, your art collection can be worth millions one day and less the next.

The good news is that if you know the approximate value of your artwork, then it is a lot easier to estimate what one piece might be worth. Please understand that the process of evaluating art is often complex and multi-faceted. As such, you should be prepared to do a lot of research on your part to really determine what your art collection may be worth.

Also, it is essential to know the distinction between personal value and market value. Evaluations should never be approached with subjectivity. To succeed, one must remain objective; having a personal emotional attachment to a piece of artwork is one thing. But the market doesn’t care how much you value your favorite artwork. It only matters what the economic atmosphere is at the time of appraisal.

How do art prices work?

When they are purchasing art, collectors sometimes fail to understand the considerable difference that exists between retail gallery or primary market prices and resale prices or the prices that private collectors eventually hope to sell their art. Sadly, some collectors end up disappointed by their investments simply because they did not take the time to understand how art prices work.

If you possess a rare piece of art in your collection, then it stands to reason that there would be a demand for it in the resale market. This is especially true for a one-of-a-kind masterpiece. However, if you are dealing with a common print or piece, it can be extremely difficult to offload it in the marketplace.

For this reason, many art collectors end up learning the hard way that despite the value the gallery may have assigned a piece of work, it doesn’t necessarily mean that one will set their art for the retail gallery price or higher.

Many collectors fail to take the time to research how the art market works. And even worse, dealers don’t bother explaining to buyers the mechanics of it all. If a collector wants to know how much their art is realistically worth in a resale market, the best person to talk to would be a professional appraiser.

How does the art market work?

The art market today consists of 2 large categories:

• Retail markets, also referred to as primary markets.
• Resale markets, also known as secondary markets.

The retail market is typically made up of dealers, galleries, and an array of art business professionals. These dealers are responsible for selling art out of retail venues such as art galleries and exhibitions.

The secondary or resale market, on the other hand, is made up of art that is being offloaded by parties that were not original owners of the pieces. One great example of a secondary art market auctions, both online and retails. Estate sales, online advertisements, flea markets, online art websites, art wholesalers, and so on all fall under the secondary market.

Sellers in the private market use their methodology to determine the price of the art. This methodology will vary from one gallery to the next. However, in the secondary market, art prices are determined by uncontrollable forces. Because of this, approximating the value of art in a secondary market can be difficult.

At the base level, art prices in the secondary art market are usually determined based on observations of how many similar works have sold in the past or are currently being offered in retail galleries, online websites, art auctions, and such places. If an individual wants to determine the actual value of their artwork, then they must speak to an appraiser that will base the value based on the market selling prices at the time. The appraiser that an individual talks to must be a neutral party and one that has experience under their belt.

How can one tell when art is valuable?

While the odds of having a one-of-a-kind piece of art are pretty slim, although not impossible, sometimes it is easy to tell when one has a valuable gem on their hands. Your artwork may be worth a little more than you think if:

It was done by a notable artist

One way to tell whether you may have a valuable piece on your hands is if it was done by a renowned artist. If you already know the artist, it may be worth doing a little more research. The better you know your artist, the easier it is to convince people to buy. When looking at the artist, it is also vital to establish how long the artist has been creating art for and whether they have an expansive body of work under their belt.

In general, art from emerging artists also tends to go for lower prices than art from experienced artists. An emerging artist can be classified as anyone that hasn’t been creating artwork for more than five years of their career. A mid-career artist is likely to ask for a higher price for their work than an emerging artist as they probably have a more significant body of work.

The condition of the piece of art

As with any collector’s item, the better its condition, the higher the chances of it fetching a great price in the secondary sales market. Check that your painting is still in good condition and that it doesn’t have any damage such as surface stains, cracking, or tears before attempting to resell it.

The medium of the work

While this may not apply to every piece of artwork, paintings that have been done using oil on canvas tend to be a little more valuable than paper-based works. How complex a piece of art is will also heavily determine its value in the market.

When looking at the medium of the work, it is also important to pay attention to things such as the frame, as some paintings come with ornate frames that are richly hand-carved. They tend to fetch a little bit more than something one would pick up at a local art fair. If the frame in question was created by the artist, it might also go a long way in contributing to its perceived value.

The size of the painting

When it comes to the art market, bigger is always better. If you are dealing with a large painting that has the power to draw the observer, then you can expect to demand a higher price for this kind of work.

The gallery that one is dealing with

A good gallery usually has a massive impact on the reputation of the artist and the value placed on a single piece of work. The more revered the gallery is, the more valuable an artist’s work is deemed. A gallery can have so much influence on the value of a painting that it can even positively impact the price of an emerging artist’s work.

Collectors, curators, museums, and biennales also have a considerable impact on how a piece of art will be priced. For decades, museums have always been regarded as the gatekeepers of the art scene. As such, if a museum assigns value to a piece of work, the museum’s recommendations are usually regarded highly.

Provenance

Even though it may not necessarily cause the value of artwork to rise, it is always nice to have a good story behind a piece of artwork. Usually, buyers are more willing to invest in an art piece that has an interesting back story, especially if it was once owned by someone popular or famous.

Provenance is perhaps more vital in determining the value of a piece of art, especially for authentication and lawfulness. However, under the right circumstance, provenance can also prove useful when one needs to drive up the price of an artwork or a collection.

How else can you assign value to an artwork?

The intrinsic value of an artwork

What does intrinsic mean and how does it apply to an artwork? Intrinsic is an inherent thing. It is the ethical and philosophical value that you assign to an art piece. Many people know that art has intrinsic value, but they do not really know what that means. Basically, when people say that artwork has intrinsic value, they are saying that art is part and parcel of life and should not be regarded as an ‘add on’ or a separate thing that should or should not be enjoyed.

It is easy to see the value of art in modern life. Indeed, were it not for art and artifacts found by historians, anthropologists, and archeologists, it would be almost impossible for humans to trace their history and cultures.

The cultural importance of art

Art and culture are almost inseparable. Art is the physical representation of people’s cultural views, practices, and diverse beliefs. Art embodies the essence of people and society through various mediums, including painting, carving, drawing, and these days, digital representations. Art is not only the best way for one to trace one’s culture but also to gain a deeper understanding of it.

Why? That’s because art reaches people beyond the physical and the emotional. Even though art can vary considerably from one culture to the next, it can also be the best tool to link cultures and bridge any divide. Art is what people use to represent their core beliefs in the community, but it can also be used to communicate power, prestige, and status.

The artistic value of art

When one talks about the value of art, one could be talking about two distinct subjects. Value in the art can be both technical as it refers to the color and the light in a piece of art. It can also refer to subjective value, which covers monetary, cultural and philosophical values.

From a technical perspective, value is also known as tint and illustrates the artist’s use of light and dark. This could be through a balanced play of the light or shadow. The technical value of art is one of the seven components of art. The remaining six include color, line, texture, space, and form.

So, does value in art affect its price?

Absolutely! The technique used by an artist to manipulate all the art elements is one of the most important things when it comes to understanding the produced artwork and assigning a price to it. How the artist chooses to use light and color and how the artist decides to balance those two elements define the aesthetic language or style of that artist.

This is something that cannot be copied; it is distinct and, because of this sheer fact, lends a higher monetary value to the piece of art in question. This type of technical value can be estimated easily by an expert. However, unlike the technical value of art, the sentimental, cultural, or ritualistic value of a work cannot be measured.

The monetary value of art

The monetary or commercial value of art takes into account all the things discussed above. What makes one artwork sell for $100 and another for $1 million is a culmination of all the factors above weighed against each other. As you can see, understanding how value is assigned in the art market is not the most straightforward thing to do, especially when there is a dispute in question. In this context, assigning monetary value to a piece of art is important for resale purposes or insurance premiums.

Final thoughts

As we’ve discussed above, the price of art is determined by market demand in most instances. If the market is obsessed with an artist, their prices will probably leap, but fluctuations in price should always be expected.

If you are a collector that is interested in starting an art collection for purposes of selling, later on, it is your responsibility to keep monitoring the prices that you come across at leading auction rooms and art fairs. In doing so, one can easily keep tabs on the market and therefore know how to better navigate it when the time finally comes to let go of your precious artwork.