The market for Australian Aboriginal art is significant and has grown rapidly over the last 30 years. While this has primarily been driven by the interest of art lovers and collectors, over the last decade or more there has been increasing interest in investment in Aboriginal art. For discussion of investment issues, see our page on Aboriginal art investment.
Size of the Aboriginal Art Industry
It is very difficult to estimate the size of the market for indigenous visual art. The difficulties arise not only from basic problems of definition (what is included? what is excluded?) but also from practical problems of measurement, survey and data analysis. As a result, estimates of the size of the industry – in terms of value of production and number of artists – are highly variable.
Professor Jon Altman at the Australian National University has described the definition problems in these terms: “… what measures should be used to estimate size and scale? Dollars returns to artists is problematic because the size of the sector is understated while overall Indigenous art turnover is equally problematic because much of the value added accrues to non-Indigenous people owing to the number of functional levels in different parts of the industry. This is most clearly evident when art from a remote community is marketed through a commercial gallery in a southern city.” (senate Inquiry Submission 2007)
The Cultural Industry Strategy developed by ATSIC in 1997 gave an estimate (but without clear basis) of an annual total value of about $200 million for the industry. The Australian Bureau of Statistics (ABS) estimated the value of commercial sales of Aboriginal art at $36 million but this has been challenged by Professor Altman as being a probable underestimate (Altman 2001).
Professor Altman estimated in 2002 that the value of the Aboriginal art market is probably somewhere between $100 million and $300 million (including manufactured product). The more conservative estimate is based on the commercial galleries survey (ABS Survey 8651.0 2001) and the less conservative estimate on adding to and updating surveys of international visitors and domestic consumers undertaken in 1997. There is almost no data on Indigenous arts exports either purchased in Australia or exported for international sale.
Given that there have been significant increases in sales of Indigenous art since 2002 it is reasonable to regard a figure of $200-300 million as a conservative estimate. Offsetting the increase since that time is the apparent decline reported by some galleries and art centres since the global financial crisis in 2007.
A figure of 5,000 to 6,000 Indigenous visual artists has been used for the past 15 years “based on a mix of rigorous quantification from community-based art centre data bases to very arbitrary estimates of urban-based practicising Indigenous artists” (Altman 2002). The National Aboriginal and Torres Strait Islander Social Survey (NATSISS) in 2002 suggested that there may be over 13,000 paid Indigenous visual artists. However this estimate conflicts with the official 2001 Census that indicated only 1,500 Indigenous people were employed in creative arts occupations.
A more detailed discussion of the Indigenous visual arts industry is given in the paper “Some competition and consumer issues in the Indigenous visual arts industry” by J. C. Altman, B.H. Hunter, S. Ward and F. Wright (ACCC Discussion Paper No. 235/2002).
Changes in the Art Market
While most people buy Indigenous art because they love the image and its cultural connections, many buyers are also interested in the possibility that their purchase might over time turn out be a good investment.
However art is generally a long term investment and most paintings do not increase in value. It is important to keep this in mind when buying an art work. If you are buying for investment it is essential that you keep yourself informed and seek advice from galleries and perhaps a professional art investment adviser who is qualified to give financial investment advice. For more information see our page on Aboriginal art investment.
There are two main sources of information about changes in the overall Australian art market, including for Aboriginal art. These are the Australian Art Market Movements Handbook by Roger Dedman and the Australian Art Sales Digest run by John Furphy which lists and analyzes the results of Australian art auctions.
The following figure shows the changes in total Australian auction sales for different artist groupings over the last 15 years (based on data from the Australian Art Sales Digest Web site):
The sharp downturn after the global financial crisis in late 2007 is obvious. Aboriginal art sales in total since 2000 had tended to equal or outperform the overall auction sales total.
A recent edition of the Australian Art Market Movements Handbook contains a discussion of Australian art as an investment. Dr Dedman comments:
The general conclusion … is that, over an extended period of time, investment in art can produce returns of around 10% per annum, making it comparable to other more traditional forms of investment. On the down side, buying and selling commissions are much more substantial for works of art than they are for shares or property. The effect of these commissions is lessened if the artwork is held for a longer period of time, and this makes art essentially a long-term investment − at least five years and preferably ten.
Since 1995, the Art Market Index has increased by a factor of 3.12, which is equivalent to an increase of 8.5% per annum compounded, or a real rate of return of 5.2%. On the surface of it, this seems to be quite a satisfactory investment, especially if you count as part of the return the aesthetic pleasure it would have afforded.
However, Dr Dedman notes that there are other factors not included in this analysis (such as the higher selling costs, storage, insurance, etc) which reduce the relative attractiveness of art as an investment. All of these factors need to be considered, in addition to the prospects of individual artists and particular works, which is why art investment advice is a specialized field.
He concludes his analysis on a cheerful note:
..a more positive approach to investment in art is justifiable. Carefully chosen Australian paintings, bought now at auction with the intention of holding them for at least five years, and preferably ten, can confidently be expected to produce a satisfactory rate of return when viewed purely as an investment. The bonus now comes from the pleasure that owning them bestows − and who can put a value on that?
Prices for Aboriginal Art.
Once you decide which regions you are interested in, and have identified a selection of artists, you will soon need some information on the average price for paintings or prints by particular artists.
By far the best source for data on the price of paintings by Australian artists (including Aboriginal artists) is the online database Australian Art Sales Digest. The service costs AUD $30.00 for one month’s subscription for online access, or you can take out a one year subscription for $255.
Sotheby’s and other auction houses hold auctions either entirely of Aboriginal art or with large numbers of works, and the catalogues for these auctions are a valuable source of information about prices, provenance and other data. The more recent sales results are available free online on their web sites. However, these data are only for the last few years, whereas Australian Art Sales Digest goes back more than 30 years and is much more comprehensive and easier to search.