Do your research and know what you’re buying.
With any expensive purchase or investment, you want to be well-informed in order to make good decisions. This guide to buying fine art at an auction is a great place to start. The internet can be a helpful first step when doing research, both to find out about the artist and relevant prices that have previously been achieved. Most databases require subscriptions, such as artnet and artprice, or you can contact us at Fine Art Brokers and we can provide initial data for no fee. Comparing artworks should not only be done visually, as there are a number of criteria to consider – quality, subject, date, provenance, and condition amongst them. Even if you aren’t an expert, you can usually still get a pretty good idea of an artwork’s worth based on a few indicators. Beware a painting that has been offered frequently and unsuccessfully at auction.
The auction estimate is only a rough guide and is often a marketing tool by the auction house, in other words, it is sometimes deliberately low to tempt bidders, or it can be low because there are negative issues. Other times the estimate can be high due to the demands of the seller. The seller will set a reserve below which the lot cannot be sold, and the reserve cannot be higher than the low estimate.
The auction specialists are only too happy to answer serious questions. Ask about why the owner is selling, ask for a condition report, and with a painting ask to see the back to see if there are any clues to the history; labels from important collections or exhibitions add to value. Nearer the date of the auction, ask about the general interest from other parties. Don’t give away your bidding strategy, though – remember the auction specialists are contracted to the seller and can potentially use your bid to get bids from other clients.
Study the catalogue carefully, as this lists what the specialists know about the lot. If there are any asterisks next to the lot number, check the glossary at the back. Also, know how much Buyer’s Premium is payable, and the Conditions of Sale. If you are successful and the hammer price is $50,000, normally 25% premium is added as the auctioneer’s fee. And know about the sales tax rules too.
Know what you are walking into and know when to walk away.
Considering what to bid can be a nerve-wracking experience. You are dealing with your own money and making not just a purchase but an investment. That can certainly be a daunting thought, so you need to set a limit. An auction can be adrenaline-inducing, so try not to get too caught up in the moment and bid more than you intended.
Equally, just because others are not bidding aggressively does not necessarily mean the lot is unworthy – if you have done your due diligence you will be sure of the value to you and your collection before the auction begins.
Understand the key players at an auction.
There are some key players in the art auction process and we list here some typical roles that you’re likely to run into:
Other terms you should know:
To view the whole list of auctioning terms, visit HERE.
General notes on buying at auction.
Contact an art professional.
If you haven’t consulted with an art advisor or an art brokerage before, it is something you should investigate especially in the early days of your collecting. The best advisors and brokers are highly trained and educated experts who dedicate themselves to helping new and experienced collectors acquire and sell art wisely. They don’t impose their views; they guide you and help you navigate the buying process. Good advisors tell you when to say ‘no’ and have a keen eye for sensing the best artwork to choose and its value. They can also help educate you about different artistic schools and introduce you to new kinds of artwork that you might not have been aware of before. Art advisors and brokerages like Fine Art Brokers help to prevent you from making mistakes when considering works at auction, can bid for you to help you and protect your privacy, and only charge when a deal is concluded.
Last Updated 2021