Georgina Adam maps out the Contemporary Art market’s new price structure in the Financial Times anticipating many of the questions surrounding the opening of the Frieze art fair:

According to Artprice.com, which tracks auction results worldwide, the volume of auction sales of artists born after 1945 in the first half of this year was $233.5m, a drop of 70 per cent compared to the same period in 2008. Art Market Research’s Contemporary art 100 index, which tracks the performance of a “basket” of 100 artists, shows a drop of 39 per cent over last year. […] “The market is still there, but it’s shrunk,” says Philippe Ségalot, art adviser to a number of top collectors including Christie’s owner, the luxury goods tycoon François Pinault. “There are fewer buyers and fewer sellers, but the real collectors are still there.”

[… Francis] Outred believes that the worst is now over. “We had to do a categorical revision,” he says, “But now most people realise that things are worth less.” Prices, he says, have returned to 2005 levels. […]

Prices have taken a big hit over the past year, with the most dramatic drops being publicly played out at auction, particularly for some of the artists who rode the boom with gusto. Top quality, however, still has a market. “It’s hard to find the best works today,” says Ségalot. “As for prices, there is only a 10-20 per cent correction at the high end. But for average quality works, prices have dropped by up to 50 per cent.”

Beyond the Boom (Financial Times)