Quarterly Market Report: Trends, Tendencies, Demand Strength
Quarterly Market Report: 4th Qtr 2011
JANUARY 2012 ADVISORY:
In today’s market, retail collectors may realize a major loss when they consign antiques and art at auction if they purchased at the height of the market and are now selling at the bottom of this much changed market.
When sold at auction, personal properties will likely realize only a fraction of their original retail price because the auction venue is chiefly wholesale and the market is trending down and will likely continue to trend downward for at least two more decades because of changing demographics. Therefore one should expect to net 10% to 40% of the original retail price for auction-sold properties, in general. However, the end results of an auction sale of personal property may provide extreme anomalies: both significantly lower results and/or significantly higher results. Explanation: Auction sales results usually fall within a steep bell curve. The peak of the curve mostly falls in the middle of a calculated presale estimate (a low-to-high range, e.g. $200-$400). Typically, about 5% of the hammer sales fall at the bottom of the slopes on either side of this curve, and in effect, offset one another. This scenario is oft repeated around the world.
Current market stylistic trends will likely compound the loss effect. Downsizing Boomers are dumping their personal property en masse at auction. Much of that consigned property reflects the decorating crazes of the 1950s through the 1980s. Furniture collected during this period was often refinished and brown, literally, as most wood is and most period styles are. However, “brown” furniture is currently not in stylistic favor, particularly in the eastern mid-Atlantic North America northward and especially with the younger generations who apparently have no style at all, and “brown” is flooding the marketplace.
The current market continues to be jittery and very cautious due to several negative dynamics mentioned in earlier Market Reports on these pages: e.g. national debt, runaway government spending, mandated health care and its impact on employers, the recent realignment within the Islamic World, rising oil futures, the Japan 9.0 earthquake and resulting tsunami, and the present threat of economic collapse of the Euro.