Sentiment in the Arts and Antiques market turned marginally negative in Q3, with 2% more surveyors reporting a fall in All Lot prices than a rise (the net balance was 0% in Q2). However, the headline figure masks significant divergence within differing price tiers, with the top end of the market (£50,000+) significantly outperforming the bottom end (£1-£1,000).

A key theme of the Q3 survey is that the collapse in housing market activity is now taking its toll on prices in the arts and antiques market, particularly at the lower and middle price tiers. With less people moving home, there is a diminished supply and demand for arts and antiques.

The top end of the market is still booming, less reliant as it is on the domestic housing market. Anecdotal evidence suggest as yet there is still there is no shortage of money at the upper price tiers, a factor reinforced lately by international investors looking to diversify outside the more traditional investment classes given the recent pickup in financial market volatility.

The strongest performing sub-sector was contemporary arts, followed by jewellery, where the net balances were 41% and 20% respectively. The weakest performing subsector was Furniture, followed by Oils and Water colours, where the net balances were -6% and -5% respectively.

In terms of the demand and sales outlooks, confidence rebounded in both cases (turning positive for sales and neutral for demand). However, attention should be paid to the highly seasonal nature of the market, as the second and third quarters are typically busiest.