NEW YORK — Art is hot.
Despite turmoil in the financial markets, there are no signs that the art market is softening.
The fall auction season in New York saw robust prices across most categories, with postwar and contemporary works going through the roof. It seemed like a new record was being shattered every time an art auction was held.
This record haul generated billions of dollars for auction houses such as Sotheby's, contributing to solid earnings but also exposing auctioneers to volatility when sales didn't go as well as expected.
The reason for the art market's strong showing? The weak dollar, expanding world wealth and new buyers from countries not previously associated with the art collecting community, experts say. Over the last five years, wealthy buyers from Russia, China, India and the Middle East have greatly helped fuel the art market.
The boom has occurred against the backdrop of a dreadful year for the financial sector in the U.S. -- a slump that seems to have been offset by the influx of foreign buyers and big American buyers who have not been affected by the uncertain economy.
These buyers paid astronomical amounts for art. An Andy Warhol painting sold for more than $71 million in a May auction that brought in a total of nearly $385 million. A Matisse fetched more than $33.6 million in a November sale that also took in nearly $400 million. A limestone lion sculpture that measures 3 1/4 inches hauled in $57 million this month.
Still, the art market hasn't been immune to turbulence.
Sotheby's suffered a lackluster modern and Impressionist sale in November in which Van Gogh's "The Fields," estimated at $28 million to $35 million, failed to sell and many other works sold below their estimates. Sotheby's stock plunged 28% that day because of investors' fears that the company had overextended itself in guaranteeing sellers' reserve -- the price the house promises to pay if a certain item doesn't sell.
"What the market was saying was that the property being offered was very heavily estimated and the quality was not there to support this value," said Ian Peck, chief executive of the art-finance firm Art Capital Group.