The Art Market Needs a Revival. Look Past the Blue Chips.

Millennials and Gen Z collectors have taken a liking to surrealist works. (Antony Jones/Getty Images for Sotheby’s)

Key Points

• The art market’s slump since 2022 could be alleviated by focusing on midmarket works, priced between $50,000 and $1 million.
• Midmarket artworks represented nearly 26% of auction sales and 32% of lots sold last year, generating over $1 billion.
• New technologies like blockchain and AI are being developed to provide accessible data for midmarket art, addressing a key barrier to growth.

The art market could get out of its prolonged slump by focusing less attention on headline-grabbing trophy art and more on so-called midmarket works.

Artworks priced in the $50,000 to $1 million range represent a far larger share of the market—and a far more diverse artist base—and can attract a wider array of buyers, according to a biennial report on art and finance released Tuesday from Deloitte Private and ArtTactic, a London data and analysis firm.

Among the potential buyers of these works are so-called everyday millionaires, those with assets between $1 million and $5 million—a growing part of the global population. According to the 2025 UBS Global Wealth Report, the number of everyday millionaires reached about 52 million last year, quadrupling since 2000.

The art market has been declining since reaching a peak in 2022. At the top three auction houses— Christie’s, Sotheby’s, and Phillips—sales of
Old Masters, impressionist and modern art, contemporary art, and Chinese art valued at $1 million or more fell more than 50% since 2022. There are signs of stabilization in the first half of this year, although sales in this upper tier were still down nearly 16% from a year earlier. The “slowdown highlights the vulnerability of relying too heavily on blue-chip names and trophy works,” the report said.

Cue the midmarket. According to the report, artworks valued between $50,000 and $1 million represented nearly 26% of auction sales and nearly 32% of lots sold last year, generating more than $1 billion. Lots sold in the $1 million-plus range, by contrast, comprised only 4.2% of the market, although nearly 71% of its total value.

Sales of midmarket works have also fallen (down 14% in 2024), but the slide isn’t as dramatic indicating prices in this segment are less volatile.

A big stumbling block for this sector is the lack of information on specific artists and artworks available for buyers, the report said.

A wealthy collector buying a $10 million painting is unlikely to object to paying for due diligence to ensure the provenance and condition of the artwork is accurate.

But, “doing the same kind of due diligence on a 50,000 euro ($57,675) [work] or even one worth €500,000—you won’t do it,” Adriano Picinati di Torcello, Global Art & Finance coordinator for Deloitte said in an interview.

Nicholas Eastaugh, CEO, and Thereza Wells COO, of Vasarik Ltd., an artwork analysis firm based in London, argue in a section of the report that midmarket collectors instead need efficient, inexpensive access to data and information on the quality, history, and authenticity of individual artworks.

“This sector’s growth can be significantly boosted through better quality data,” Eastaugh and Wells wrote.

Several companies including Art ID, Articheck, and the Art History Lab, are developing technologies to make that data more easily accessible, the Vasarik authors wrote. They are drawing on technologies such as blockchain and artificial intelligence to assess the physical condition and provenance of artworks, among other characteristics.

“The new technologies to achieve this middle-market boom are either already in place or will be very soon,” they said.

That should be welcome news to a rising generation of collectors who will be inheriting not only wealth, but art and collectibles. The ultrawealthy—those with at least $30 million in net assets—owned $2.6 trillion of art and collectibles last year (up from $2.2 trillion in 2022).

Of this elite group 25% consider themselves collectors, often allocating 10% of their portfolios to art, the report said. What the next-gen of these ultrawealthy will inherit in just arts and collectibles is mind-boggling: Nearly $1 trillion worth of objects could change hands by 2034, the report said.

But, it will be important for art market participants to broaden the landscape of fine art for these buyers, especially considering that they have different tastes, and are put off by the market’s opacity, costs, inefficiency.

According to the report, newer collectors are more interested in “digital art forms, emerging and experimental artists, and social causes tied to art.” But they are also looking to the past, taking a liking to surrealism, an art movement of the early 20th century that draws from the subconscious imagination.

A separate report from Sotheby’s and ArtTactic from September revealed millennials (roughly aged 29 to 44), and Gen Z (age 28 and younger) have been scooping up surrealist works. The auction house sold 23 surrealist pieces in London in mid-September for $41.1 million, far above a nearly $28 million estimate. And at a November evening sale in New York, Sotheby’s will showcase a suite of 80 surrealist works from a private collection led by Frida Kahlo’s El Sueño, 1940, estimated to fetch as much $65 million.

Millennials represented nearly 24% of all bidders of surrealist works in the first half of this year compared with less than 13% in 2018, while Gen Z represented 6.2% of all bidders, up from 0.5% in the same period, the report said.

Just over half of wealth managers, collectors, and art professionals surveyed this year said “shifting consumer preferences and competition from other luxury collectibles,” are the primary reasons the art market is stagnating, the report said. At Christie’s, 41% of bidders for luxury categories are millennials and Gen Z, it said.

The next generation is also more interested in “blending purpose with profit,” focusing as much as “identity, culture, and legacy” as on financial gain.

Write to Abby Schultz at abby.schultz@barrons.com