Mar 5, 2014 23:29:44 GMT 1 Ponyboy Curtis said:

I'm all for talking down the price of Banksys work but you're assuming that the buyer wasn't aware of the extra costs. I'm suggesting that he knew this, was prepared to pay it and thus the full amount he paid is the value of it.

put it this way. Do you think he'll sell it for 7k or closer to 9k?

I'm not talking down prices any more than talking them up.

You keep insisting at looking at all the costs a buyer incurs in order to value a print and seem to be completely blind to all the costs a seller incurs.  I'm on about the value of a print, without looking at it from either the buyers or the sellers point of view.  Neutrally and objectively.

I sold a print at Bonhams on this week. It would be great if I could look forward to receiving the hammer price but I know I will be getting considerably less than that due to commission deductions.  But I don't sit here thinking that the print was worth less than the hammer price because my cheque has a lower figure on it that the winning bid.

In the same way, the buyer is paying more than the hammer price due to premium and possibly VAT. Does that mean that the print is valued at more than the hammer price? I don't think so. 

The hammer price is what someone was willing to bid for the print and that's all there is to it. They were prepared to pay a premium and VAT on top, but that is irrelevant to the value of a print IMO. 

As an experienced buyer and a seller, I know you have to ignore the auction house's and tax man's cut when looking at valuation. 

If you don't want to accept that then that's fine by me but unfortunately it's not going to improve the value of any art that you or other sellers might own.

Mar 6, 2014 21:16:06 GMT 1 lee3 said:

>>>It doesn't mean they are right to do so or that private sellers should be encouraged to follow the same approach.<<

I'm suggesting that it seeps into most of our collective conscious which is supported by market evidence. Whether you agree with the logic is entirely up to you but what neither of us can do is argue decades of pricing evidence. Pick any high demand edition that has traded 3 times over at auction achieving similar prices at 2/10/20/100k, whatever. The odds are stacked against you of convincing any would-be seller privately from accepting that pricing history minus 20 or 30% when there are plenty of willing buyers that will pay the going rate.

One very large point that you have left out of your equation for paying an auction house is from a consignors position and what I consider a hope premium. Your hope as the consignor is that the decades of pricing power that any of us can point to clearly support long term higher prices through inflation and demand. You are paying a premium to consign to auction in the hopes that your print will be the print that establishes a new, higher level than past history suggests. Otherwise, it's far easier to shift high demand prints on the secondary market for the going rate. IOW, it's not just the buyer who pays a premium to a house for all the aforementioned reasons, but it's also the seller and together their combined actions equate to a price that the wider market accepts as the going rate.

I don't look at it like you do and tend to look at auction prices as fact though I'm hardly alone which is a principal reason auctions are manipulated to no end. The bottom line is that one can twist an auction price to fit either argument as buyer or seller but the one thing we can't twist is the total price paid.  Then it's up to each of us to discern whether or not we feel the price was genuine or manipulated and take it from there.

It's not a question of twisting auction prices. It's the exact opposite.

You are getting into the same arguments over whether you take "what the buyer paid" as the value of a print or "what the seller received" as the value of the print. That is a futile debate.

The point I was making is that the final "winning bid" is the only thing that can be fairly agreed by both buyer and seller as being the value of a print that recently sold at auction.

Surely the winning bid is the going rate and the evidence of valuation.  How else could you look at valuation objectively in a private transaction?

Mar 6, 2014 23:07:20 GMT 1 jp said:

Mar 6, 2014 21:45:21 GMT 1 silvermyn said:

It's not a question of twisting auction prices. It's the exact opposite.

You are getting into the same arguments over whether you take "what the buyer paid" as the value of a print or "what the seller received" as the value of the print. That is a futile debate.

The point I was making is that the final "winning bid" is the only thing that can be fairly agreed by both buyer and seller as being the value of a print that recently sold at auction.

Surely the winning bid is the going rate and the evidence of valuation.  How else could you look at valuation objectively in a private transaction?

He is saying that the *market* takes "what the buyer paid" as the final value and that is the end of the story. It does not matter what you think is right or wrong, this is simply the way results are reported by auction houses as well as respected publications. For example, I am looking at "The Photographic Art Market" for 2007 right now. There is no distinction made between hammer and final price in the print results I am looking at. There is only "price". That price is "the amount paid for the print, including the buyer's premium, in U.S. dollars". That is how the market views it and reports it, weather you or I like it or not.

Well, I'm part of the "market" and I don't take the sum total of what the buyer paid to an auction house as the final value of the print. I have no idea what additional sales taxes or artists resale rights were charged to the buyer in addition to the premium, it's not any of my business. Without that information only the buyer would know what was paid in total.

Insurance companies do not take account of buyers premium either when paying out on a claim. When I had a piece damaged, the insurance company did not take into account any buyers premium when establishing the valuation.

There is a very good reason for that, the buyers premium is only relevant if the item is to be replaced via an established auction house.  It is irrelevant when replacing something through other avenues, a private sale being one of those avenues.