The global art market stands at a pivotal crossroads, with new data revealing dramatic shifts in collector demographics and buying patterns that could reshape the industry’s future. A comprehensive 2024 survey conducted by Art Basel and UBS has uncovered evidence of what many industry insiders have long suspected: the traditional art market is undergoing a fundamental transformation.
The market’s total value has remained surprisingly stable, hovering between $60-65 billion annually over the past two decades. However, beneath this seemingly calm surface, tectonic plates are shifting. While the wealthy are getting wealthier, they’re allocating a significantly smaller portion of their fortunes to art than in previous years. Even more telling, established collectors are scaling back their participation in art events, despite strongly preferring in-person purchases.
Perhaps most significantly, a massive transfer of wealth is underway. Valuable art collections are passing from older generations to their heirs, who often have markedly different tastes and priorities. Meanwhile, younger collectors, who were once seen as the market’s driving force, appear to be pulling back from major acquisitions.
“We’re witnessing a meaningful change in what’s being sold, even if the overall market value remains relatively constant,” explains Noah Horowitz, Art Basel’s CEO. “The crucial question now is whether we can find new paths to growth as these dynamics continue to evolve.”
The survey’s methodology was robust, drawing from two distinct pools: over 3,600 active market participants from 2022-2024, and more than 1,400 private collectors from Art Basel’s exclusive VIP list. The findings paint a nuanced picture of both challenges and opportunities.
One bright spot is the sustained appetite for art acquisition, though preferences are notably shifting. Works on paper, traditionally more affordable than paintings, saw a remarkable surge in popularity. More than half of respondents purchased works in this category during 2023, up dramatically from just 33% the previous year. Similarly, emerging artists accounted for over half of high-net-worth collectors’ purchases in 2023 and 2024, marking a significant increase from earlier periods.
Female artists have emerged as major beneficiaries of these changing dynamics. Their works now represent 44% of high-net-worth collections, reaching a seven-year high. Among the most active collectors – those spending over $10 million in 2024 – works by women artists accounted for 52% of purchases. Paul Donovan, chief economist at UBS Global Wealth Management, points out an intriguing correlation: “The percentage of female artists’ sales closely mirrors the proportion of women among UBS clients, which has grown by five percentage points recently. Given projections that women may control the majority of global wealth within two decades, this trend could accelerate.”
However, some concerning trends are emerging. Art’s share of high-net-worth portfolios has declined sharply, dropping from 24% in 2022 to just 15% in 2024. While this doesn’t necessarily indicate a collapse in art values, it suggests that art investments haven’t kept pace with other asset classes, particularly high-performing tech stocks.
The market’s structure is also evolving. Clare McAndrew, founder of Arts Economics and the report’s author, notes a significant shift: “We’re seeing stronger performance in the market’s middle and lower segments compared to the top tier. While this might appear negative when looking at major auction houses’ headlines, it actually indicates a broadening of the market base with more transactions, albeit at lower price points.”
The looming generational wealth transfer adds another layer of complexity. A striking 91% of wealthy respondents owned inherited or gifted artwork, challenging the notion of self-made collections. More importantly, three-quarters of these inheritors plan to sell at least some of their inherited pieces. Their motivations vary – about half cite space constraints, while a similar proportion need to cover estate taxes. This suggests a potential flood of inherited art entering the market, which could pressure prices.
Perhaps most surprisingly, millennials, long considered the market’s future, reduced their art spending by up to 50% in 2023. This represents a dramatic reversal of previous trends where younger collectors led spending growth. Overall collector sentiment also appears cautious, with only 43% of wealthy individuals planning art purchases in the next year, down from about 50% in previous years. Meanwhile, those planning to sell increased to 55%.
Even among Art Basel’s VIP collectors, traditionally the market’s most committed participants, there are signs of changing behavior. While 97% intend to make purchases in the coming year, they plan to attend fewer gallery shows and art fairs than in pre-pandemic 2019. This shift in engagement patterns could have significant implications, given that nearly 90% of these collectors strongly prefer buying art in person.
The art market appears to be maintaining its overall health, but the composition of transactions is undeniably changing. As Donovan summarizes, “We’re not seeing a decline in transaction volume, but rather a structural shift in the types of transactions taking place.” This evolution suggests that while the art market may maintain its size, its character could be transformed dramatically in the coming years.
For galleries, auction houses, and other market participants, adapting to these changes will be crucial. The successful players will likely be those who can balance the traditional high-end market with emerging collector preferences for more accessible price points and diverse artists. As the market continues to evolve, the ability to navigate these shifting demographics and preferences may determine who thrives in this new landscape.
Acknowledgment: This article was written with the help of AI, and inspired by, while including information from, "The Art Market Is on the Brink of Major Upheaval" published on www.wealthmanagement.com. For more detailed insights, you can read the full article here.
