With news on the economic crisis front continuing to come in fast and furious, what might have seemed impossibly or unlikely one week can seem either plausible or certain the next. Take, for example, this recent story on lifestyle portal deluxe.hu, which features several prominent local art dealers talking about what is likely to happen to the local market for fine art. Or what they thought was likely to happen, before the international art market started getting uglier than the average bad painting.
According to the piece, gallery owners and other “experts” sound confident that upcoming auctions will be successful. One such expert even said that during times of economic and financial crisis, the price of artworks increases, before adding that art is a long-term investment.
There also seemed to be a consensus that, compared to most art markets, Hungary’s doesn’t favor contemporary artists, meaning that modern Magyar art might be a relative bargain. Though for her part, well-known gallery owner/auctioneer Judit Virág somewhat oddly claimed that if she was going to buy art for investment purposes, she would buy “classics as well as contemporaries” to “minimize losses.”
Fast-forward a few weeks (it’s not entirely clear when the article was published) it seems that all this may be wishful thinking, to say the least. In just the past few days, major sales at leading international houses like Christie and Sotheby’s flopped spectacularly, with many lots selling for either half their low estimates, or not selling at all. In other words, the most recent boom in the international art market seems to have gone bust.
Whether this bloodbath will be played out in Hungary will become clear within the next ccouple of months, as dealers like Virág hold their big “year-end” auctions. (That’s the crowd at one of her recent sales above; she normally uses the cavernous Budapest Congress Center for her auctions.) Given the long-running whispers about phantom buyers and hidden reserves, a local crash might not be as readily apparent as in the more transparent auctions held by firms in London and New York. Still, the picture is unlikely to be pretty.