The Recent History of the Art Market through 12 Record-Breaking Sales 

Record Prices vs. Inflation Growth and the S&P 500

Since 1985, the record price paid at auction for work by a living artist has been broken 12 times. Interestingly enough, only 6 artists were behind the records which redefined the market, with top prices growing exponentially, though unevenly, from the 1980s to present. Based on our calculations, the prices grew at a pace of around 7.5% annually between 1986 to 2019, when the most recent record was set. Over the last 25 years, the maximum nominal price paid for a living artist’s work outpaced growth in the annual rate of inflation by 3x, but fell behind the 10.5% delivered by the S&P 500 in total returns in the same period.

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A Period of Dominance for the American Art Market

The 1980s proved to be a momentous decade for American artists. The first living artist whose work exceeded $1 million at auction was Willem de Kooning, whose painting of Two Women sold for $1.21 million in 1983 at Christie’s, New York. In addition to the price point, the sale was symbolic: for the first time, the record came to be held by an Abstract Expressionist artist from the New York School, rather than one of the great artists of pre-World War II Europe, like Pablo Picasso or Salvator Dali. The record was then broken in rapid succession four times by Jasper Johns, and again, by De Kooning in 1989. But the art market cooled rapidly in the 1990s, as a mix of economic and political upheaval curbed much of the excess spending characteristic of the previous decade. The record for a living artist, which by then had escalated to $20.7 million for Interchange, remained in place for 18 years. 

A Resurgence in the Global Contemporary Art Market

When the market for Contemporary Art rebounded in the mid 2000s, it revealed a substantial shift that had been forming: the resurgent interest in European and Contemporary art. The global collector base once again became willing to pay top dollar for the best works by German and British artists, as reflected by two consecutive records by Gerhard Richter, and also, Lucian Freud and David Hockney. However, the most  fascinating market maker of the last two decades has been Jeff Koons, an American artist known for his unconventional methods and use of new media. Auction prices for Koons’ work first broke $5 million in 2006, and the following year, his monumental stainless steel Hanging Heart sculpture reinvigorated the top end of the market when it sold for $23.6 million. Though Koons’ record was broken in 2008, he regained the coveted title of most expensive living artist in 2013, lost it in 2018 to Hockney, and topped the market again less than one year ago when his silver Rabbit sculpture sold for $91.1 million. 

The question remains: which living artist will break the $100 million mark first?

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