#5 How is Artwork Priced?

Some of the most common questions I get asked by collectors who are starting to purchase art are about pricing. Why is one work of art more expensive than another? Who decides how much a work of art is worth? Is this work of art in front of me worth the price it is listed at?

This fifth lesson will outline many of the factors that go into pricing a work of art. The price of an artwork can be set by the artist, gallery, or art auction specialist; and, understanding how these prices are determined will help you better appreciate the work, materials, and techniques that go into creating art, the identifiers of a strong artistic career, and the intrinsic value of art (and artists) beyond what just attracts the eye.

I always recommend that collectors be wary when considering artwork, its value, and its price. It has been said that value informs price, but that price does not inform value, meaning that just because something is expensive does not necessarily mean that it is valuable. Pay attention to what speaks to you, what you find interesting, and those artists you admire or with whom you feel a connection. This will inform what is valuable to you, now and in the future.

Air kisses (:* :*), Casey

Ways That Artwork Is Priced

Size

Generally speaking, the larger the artwork the higher the price. Pricing based on size considers the amount and cost of materials used, as well as the time taken to complete the artwork. Some artists and galleries use a basic formula to price artwork comprising a set dollar amount based on the artist’s reputation (or sales history) multiplied by the artwork’s size in square inches.

Material, Technique & Visual Quality

Pricing can be influenced by the cost of the materials used. Sculptures made from bronze, for instance, often have higher prices due to the initial cost of raw materials (and perhaps even special tools needed to create the artwork). Pricing based on an artist’s technique can take into account the complexity of the technique (the more complex a technique the higher the price), or the popularity of a technique (how well-regarded is the technique and how long does it take to master?). Visual quality can be subjective, however, artwork with complexity, strong and/or balanced compositions, and originality are considered to be of higher value.

Artist’s Lifecycle

An artist’s reputation and the level of recognition they have received greatly contribute to how expensive an artwork is. Artists who command the highest prices have lengthy and consistent exhibition histories with notable galleries, artwork in permanent collections of museums and institutions, and published articles, essays, and reviews about them in scholarly journals and significant art publications. If you have a smaller budget, buying artwork from emerging artists can be a great opportunity to collect unique, strong, up-and-coming artists at lower price points.

Where the Artwork is Being Sold

Artwork purchased from galleries and art fairs has been priced according to the size of the work, the success of the artist’s most recent exhibition, and other notable and recent accomplishments, such as winning awards or museum exhibitions. Galleries try to price an artist’s work consistently and with an upward trajectory to support the artist’s career development. Auction houses price artworks using “auction estimates.” Auction estimates fluctuate more than gallery pricing due to changing buyers’ tastes, artist popularity, and art market cycles. The final price of an artwork at auction is ultimately determined by the winning bid.

Other Costs to Consider

When building an art collection with a particular budget, there can be additional costs on top of the artwork’s price to consider. These can include:

• Auction House Fees (Buyer’s Premium)
• Framing
• Shipping & Installation
• Insurance
• Conservation
• Storage

These additional costs vary greatly depending on the type of art you are collecting, and we can certainly discuss in more detail on a case-by-case basis.