This analysis of Gunther Forg’s market—using data gathered with the help of Athena Art Finance—is available to AMMpro subscribers. Subscribers get the first month free on monthly subscriptions. Feel free to cancel at any time before the month is up. Sign up for AMMpro here.

Barely a third of the way through 2017 it is becoming clear that Gunther Forg’s market has come into its own. In London and Amsterdam this month, there were a series of sales of Forg’s work from different areas of his oeuvre that confirm and re-confirm his six-figure prices.

The untitled painting, above, was sold at Christie’s First Open sale in London on April 5th for £125,000 ($157,500.) That price is almost exactly the average price for Forg’s work in both 2015 and 2016. 

The record for Forg was set last year in May when Phillips sold a set of six of his lead paintings for $815,000. Although the work was priced to achieve a higher level, perhaps anticipating a level of momentum that does not yet exist in Forg’s market, Forg’s market is settling into a clear range with the top ten lots sold at auction all achieving prices between $437k and $815k. That’s a substantial range, yes. But it is also a defined price range.

Those prices were mostly achieved—six of the top ten prices—in 2016; the rest—three sales—were in 2015; and one stand out sale took place nearly four years ago in 2013.

Forg’s market history, going back over the last 10 years, had a brief spike in 2007 as the broader market for Contemporary art leapt. But it wasn’t until 2012, the year before his death, that Forg’s market volume and bidding intensity increased. The chart, below, shows each of the sales over the ten year period from 2006-2016 plotted by Premium ratio over the time period. What this chart clearly shows is the increasing number of lots on the market somewhat in response to the previous year’s bidding intensity.

 

If you want to look closely, you can see that the bidding intensity of 2012 produces many more sold lots in 2013. In 2014, 15 and 16, there is a healthy band of lots bid four to five times above the low estimate. In 2012, 15 and 16, there is a single lot that was subject to bidding fierce enough to sell for a price eight times the low estimate.

Isolated bidding wars don’t tell us much about an artist’s broader market but the counter point of intense bidding followed by strong bidding on more lots—as can be seen in 2016—suggests an artist whom buyers are flocking to with growing confidence. We think we can show that process in a series of charts that look at the auction data in different ways.

The first, below, is simply to plot Forg’s average price at auction against his total sales volume. Starting in 2012 and rising through 2014, there’s a steady correlation between Forg’s rising average prices and his growing sales volume. What you’re not seeing in these charts is the market getting flooded with work that suppresses prices or average prices staying the same as volume rises. That second dynamic is clearly visible in 2015 and 2016.

Average price rose sharply in 2015 for Forg as volume nearly doubled. In 2016, volume doubled again from almost $5m to $10m but the average price remained the same. That’s a strong signal for Forg’s market. As pointed out above, the early indications are that Forg’s market remains at the same levels so far in 2017 even on limited data.

To get a better sense of the growth of Forg’s average price at auction, we plotted the Premium ration (simply the price paid for the work divided by the low estimate) against the average price. You can see that in the chart beneath this paragraph. There the average premium ratio for the year’s auction sales peaks in 2012. This is partly a function of the smaller number of lots sold in 2012 compared to the later years.

As the average price rises, the premium ratio falls. That simply means the estimates are rising to meet the level of the market and the expectations of buyers who are settling upon a price level that seems right to all participants.

The same story is told by plotting the premium ratio against total sale volume (below.) The bidding intensity is falling as buyers know what to expect. And they continue to buy, expanding the market to twice the previous year’s size.