Estimates are an important part of the auction houses’ marketing approach toward selling a work. Consignors prefer high estimates that confer value and foreshadow a successful sale. Buyers are attracted to lower estimates in the hope that a work will sell for a reasonable or even bargain price. It’s the eternal struggle of the auction business.

When a large number of works sell for prices above the high estimate, it’s a good sign that buyers are entering the market. Competition drives prices at auction. Sales above estimates are a good gauge of competition and expectations about future prices. You can see from the chart that 2005, by no means a bad year for the art market but still the last year before the acceleration of the boom, the works that sold were fairly evenly split between above, within and below estimates.

During the height of the boom, in 2006 and 2007, prices soared above estimate level. In 2008, before the financial collapse, and 2009, the market reversed. We can see echoes of the glory days in last night’s sales with nearly half the lots selling about the estimate range. What’s different this season is that Christie’s got so many of the estimates right with the biggest number of lots for an evening sale coming in within the estimate range in the last six Spring sales seasons.