Why People Don’t Know How Much Their Art Is Really Worth

Depending on your perspective, the verdict delivered by art services and technology company Winston Artory Group was either very good or very bad. A print that had recently been appraised for $1 million was, the company determined earlier this month, now worth just $300,000—a 70% decline in possible value. These were happy tidings for the insurance company that requested the appraisal, and potentially devastating for the print’s owner. “The insurance company loved it,” says Winston Artory’s Co-Executive Chairman Elizabeth von Habsburg. “The client, maybe not so much.”

Art is not easy to value. Unlike soybeans or gold, whose prices might shift but whose inherent qualities are immutable (one soybean is functionally the same as any other soybean), every artwork is different, and therefore must be considered on its own merits. Making valuation even harder is the fact that a huge chunk of the art market’s transactions are conducted privately, meaning that variations in price are often impossible to discern unless the world is explicitly told a sale has taken place. (Even then, the exact price is often suspect.)