The Art and Science of Valuations: Understanding Art's True Worth

Valuing art is both an art and a science. While the numbers may be driven by data—market trends, provenance, and condition—there remains an undeniable subjectivity to the process. Whether for insurance purposes, estate planning, or legal proceedings, understanding what makes a piece valuable is a nuanced endeavour that requires both expertise and instinct.

Julia Bell, founder of Parapluie Art, is well-versed in this delicate balance “A good appraiser should be independent and impartial to the client requesting a valuation. They should respond appropriately to the intended use of a valuation, using different appraisal techniques to arrive at credible valuations depending on their purpose. They should have a substantial case file that demonstrates how they have arrived at a measured and objective judgement of value that can, if required, stand up in a court of law”.

However, valuations become particularly complex when art ownership and value is disputed, such as during divorce proceedings. The value of an artwork can be a contentious issue, with differing opinions on its worth impacting the division of assets. As Julia noted, “Wildly different valuations on the same personal property often happen when those brought in to ascertain value are not adhering to professional valuation standards, or are compromised in the first instance and are too subjective in their approach”. 

Charlotte Lanning, a Senior Associate at Edwards Family Law has seen these complexities first-hand. ‘Valuing assets is a huge part of what we do when resolving financial matters upon divorce and is not without its cost or complication. Over the years, the court has repeatedly acknowledged that certain types of valuations, such as business valuations, are ‘inherently fragile’ but they are still widely relied upon, at least in part in the absence of any real alternative, other than forcing a sale. However, as with any valuation, these expensive reports are only worth something if there is in fact a willing buyer in the market. When it comes to art this is further complicated by the fact that there are often both financial and emotional considerations that come into play which can make the task all the more difficult.

You are often balancing a commercial value against sentimental value, which can arise for a whole host of reasons. Someone may seek to overvalue a piece of art because they know the other party desperately wants to keep it at any cost, thereby reducing what they may be entitled to share from the rest of the assets.’ 

In a recent case, the valuation of an art collection became a central point of contention in divorce proceedings (wittily anonymised as GO v YA, a nod to the 18th century Spanish painter). Expert opinions as to value varied significantly, and the husband himself being an expert only made matters more difficult. Unsurprisingly, the valuations presented were miles apart. The court ultimately adopted the more conservative valuation, but the husband was afforded a year to raise funds to buy out the wife’s interest in his business (which owned the art), absent which it would need to be sold. However, and whilst the judge acknowledged that there was a limit to how many pieces of art could be sold in one year without significantly impacting value (due to a ‘flooded market’), a forced sale in due course could cause exactly that, with both parties losing out. Whilst a unique case, it underscores the inherent challenges in objectively assessing art's worth and fairly distributing this, especially in emotionally charged contexts.

Such cases underscore the importance of working with reputable, experienced professionals who can provide objective, well-documented valuations. Understanding the story behind the piece, alongside the numbers, is crucial to determining its place in the market and, ultimately, it’s worth.

At Artroom London, we believe that valuing art is about respecting its past while understanding its present market context. The complexities and nuances make this field endlessly fascinating and remind us that art's value is more than a number; it's a narrative waiting to be understood.

Many thanks to Julia Bell and Charlotte Lanning for sharing their insight