The ups and downs from KAWS are estimated at £30,000-50,000 pounds during previews at the Phillips showroom in central London, ahead of upcoming evenings and day edition auctions. Photo Date: Friday, January 17th, 2025 (Photo by Ian West/PA Images via Getty Images)
Ian West -PA Images | PA Images | Getty Images
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auction sales have been declining for the third year in a row as dealers, auctioneers and collectors are pondering the deeper crisis in the art market.
According to Arttactic, auction sales for Sotheby, Christie’s and Phillips fell to $3.98 billion for the year, down 6% compared to the same period in 2024. Auctions totals are at least the lowest in a decade (excluding the 2020 pandemic), down 44% (over $3 billion) since 2022. This decline fell 19% in 2023 and 26% in 2024.
According to Arttactic, postwar and contemporary art, the main engine of recent decades of art auction growth, fell another 19% in the first half.
“The lingering concerns about global economic growth, ongoing inflation and rising geopolitical tensions have created confidence and a more cautious investment environment,” Arttactic said. “These factors could challenge the market momentum later this year as the industry is still reliably adapting to the global landscape.”
However, these lingering concerns have not emerged in other areas of the wealth economy. The prosperity of the wealthy is on record levels, with the top 10% of Americans adding $37 trillion to their wealth since Covid, showing an increase of 45%. The stock market has risen by more than 20% in both 2023 and 2024, and has risen once again in 2025. Housing values and business valuations are also rising, with individual wealth increasing.
Yale Professor William Getzman has been studying the relationship between art prices and financial wealth for over 300 years and has found that they are “very correlated.”
“The demand for art increases with a wealth of art collectors,” he wrote in his famous paper, “accounting taste, art and financial markets for three centuries.”
But more than ever, Goetzmann said the 300-year correlation has been broken. He said there is one of two explanations for divergence. The art market dip is a temporary anomaly, saying it’s either bounced back this year or next year, or that the art market is undergoing more structural changes.
“The problem is that there is some kind of fundamental deviation from the social norm that very wealthy people are very involved in gathering art at the highest prices and levels,” he said. “I don’t know yet.”
That fundamental deviation, if it is happening, could be rooted in generational changes in wealth. For decades, the art market has been driven primarily by the baby boomers who built large art collections as wealth grew throughout the 1980s, 90s and 2000s. Many of these baby boomer collectors are currently purchasing less or downsizing. And children often don’t want art, so the growing number leaves behind a large collection.
At the same time, the new generation of millennials and generation Z may have grown up in a more digital world and may not have the same preferences or interest in the paintings of 20th century artists. With some experts holding more than $100 trillion in wealth, primarily from baby boomers to the next generation, the arts market could be showing signs of structural change and a more existential crisis, some experts say.
The auction house races to adapt with more online sales, luxury items and lower priced products. According to Arttactic, auction sales in luxury categories, including gems, handbags, wine, watches and sports memorabilia, rose 1% in the first half.
Jewelry shines particularly brightly among young female collectors as it transforms wealth into women. Jewel and jewelry sales increased 68% in the first half compared to a year ago. Online auctions also gain more share than physical auctions, as young collectors prefer to bid from their mobile phones.
Total auction sales at Christie’s were stable in the first half. This is largely thanks to online sales and luxury. Luxury sales, including classic cars, surged 29% to $468 million. Among the highlights were the Marie Tarce Pink diamonds that were said to belong to Marie Antoinette, which sold for $14 million, and the “Blue Bell” fancy vibe blue diamonds went for $11 million.
The glow of jewelry and luxury goods is also supported by Sotheby’s, which sells its own blue diamond, the famous “Mediterranean blue” in May after a fierce bid war.
Young collectors are driving strong demand for collectibles priced under $100,000, with the most competitive bids for works under $50,000. According to the Art Basel and UBS Global Art Market Report, the top end of the art market, which costs over $10 million and costs over $10 million last year, earned 39%, while sales under $5,000 increased by 13%.
Christie’s CEO Bonnie Brennan told reporters that the main mission of the auction house is to provide the objects that clients want today, especially at a reasonable price for a new generation of collectors. 80% of bids this year were online, with nearly a third of bids coming from millennials or Gen Z buyers.
“We have a huge connection with younger generations, millennials and Gen Z,” Brennan said. “It’s really important to keep up with business in the future.”
