A newly published report by Bank of America on the art market reveals that lower auction estimates, gallery discounts, and recent interest rate cuts are driving increased collector participation in major events, such as the fall auctions in New York and Art Basel Miami.
Favorable buying conditions have emerged following weaker-than-expected secondary market art sales in the first half of the year, with auction prices just 1% above their average estimates — the smallest increase in over seven years, according to the report.
Additionally, the lack of prominent estate collections in May sales may have dampened bidder confidence and enthusiasm. Fewer masterpieces are being offered in what is widely seen as a “buyer’s market.”
Gallery Challenges
Galleries face a critical decision: adapt to the new market reality or risk accumulating unsold inventory.
“Collectors are more discerning than ever. They know galleries are still selling A+ works, but terms are more negotiable for everything else. Collectors are using that knowledge to secure more favorable transaction terms — from bypassing waitlists and removing resale restrictions to ‘buy one, gift one‘ deals and price discounts,” said Drew Watson, Head of Art Services at Bank of America Private Bank.
Interest in Latin Artists
Although some auction prices are softening and bidder competition is decreasing in certain areas, the report highlights strong collector interest in specific categories, particularly the market for Latin American artists and the Latin diaspora, which is expected to continue growing through 2025. Sales in this sector have risen by 18% year-over-year, showing no signs of slowing down, supported by recent market activity and institutional backing.
“Latin American artists have seen strong buyer interest and high sell-through rates this year,” Watson noted. He also mentioned multiple record-breaking auction sales during the spring, while biennials and art fairs have become key platforms in the primary market.
Art as a Wealth Strategy
The report also highlights that collectors increasingly view art as an asset integral to their overall wealth management strategy. By 2026, the estimated value of art and collectibles is projected to exceed $2.8 trillion, representing approximately 11% of ultra-high-net-worth individuals’ portfolios.
Interest is expected to grow further as younger generations build and inherit wealth in the coming years.
