In June, Bonhams will hold the first sale in the UK of contemporary Asian art. For those who haven't followed sales in Hong Kong, this new market is like nothing the experts have seen before.
Howard Rutkowski of Bonhams says: "We've done very little to promote this sale but word of mouth has spread like wildfire. We're getting requests for information from around the world. Artists such as Wang Qingsong have quadrupled in price in the last five years, and that's pretty much across the board."
Sotheby's held its first contemporary Asian art sale in New York last week. Xiaoming Zhang was one of those who gathered work for the auction. "In the last two years, our growth has been 350 per cent for this market," he says. "Prices have doubled, tripled, quadrupled. In our last Hong Kong sale we had a painting - Yellow Baby (1998) by Zhang Xiaogang of China - that we'd estimated at £17,000 to £26,000. It fetched nearly £110,000."
One reason that Chinese work is causing such a stir is the history of art in the country over the last three decades. The art schools started to reopen in the late 1970s, having been shut down under Mao's rule, but the Tiananmen Square clampdown in 1989 put a stop to artistic freedom. Art was forced underground as exhibitions were closed.
Then, pioneering Western curators put together important shows in Western institutions, bringing this art to the outside world. Collectors have been clamouring for it ever since.
"When we first went out to China, you could buy a Fang Lijun painting or one by another of the 'big four' artists for a couple of thousands dollars, depending on size," says Julia Colman of the Chinese Contemporary Art Gallery, which opened in London 10 years ago.
"Now the gallery prices start at about $20,000 [£11,500] and go up to $300,000. In 2004, we opened our gallery in Beijing and we were the fourth gallery in the area. Now there are 40 galleries."
Such prices also reflect the growing wealth of China - and the quality of the work. "The art is fabulous," says Colman. "Historically, it's a unique moment - you have a Communist government with a blatant market economy, and many of these artists have gone from being penniless comrades to wealthy people who can influence the course of culture in their country."
The top four living artists are Zhang Xiaogang, Yue Minjun, Wang Guangyi and Fang Lijun. Work by these four is in short supply and buyers have been willing to pay very high prices.
"Everything keeps shifting so quickly. We are already looking at third-generation artists," Rutkowski says. "Those who first appeared in 1989 and 1990 have seen stratospheric price rises and they are now out of reach of most people, but there are many new young artists who are international in terms of the appearance of their work."
Chinese art is moving so fast that there are already several distinct groups or movements. The first-generation artists of the late 1970s were followed by the newer political pop and cynical realism movements of the late 1980s and 1990s. Now prices are rising for even younger, third-generation artists who work in a variety of mediums, including photography, video and sculpture.
The Sotheby's sale introduced a significant amount of new material. "Contemporary ink painting has been ignored by the international collectors and only collected by a very few who have a strong interest in China and a deeper understanding of the Chinese culture," Zhang says. "It's an undervalued area."
The question for investors is: can these price rises continue? Yes - for the best work. To date, most buyers have been Western, but with the Olympics to be held in Beijing in 2008, the Chinese government wants to present a modern cultural image and artists will benefit.
"I think the market will continue to go up. Look at the prices for top contemporary British artists; they're still way beyond that," Colman says. "And we are now seeing the Chinese buying. They have phenomenal new wealth."
Western collectors are taking this market seriously. Most major institutions and museums are building up collections and holding exhibitions. But, while prices have already soared for the earlier artists, there is still room for them to rise.
But tread carefully: in such a market it is easy to buy mediocre work just to ensure you have "something". For investment purposes, the best work by the top artists represents the best bet. But if you want to take a punt on an up-and-coming artist, be sure you'll like the work no matter what happens to its price.
Bonhams: 020-7393 3900; www.bonhams.com
Chinese Contemporary Art Gallery: 020-7499 8898; www.chinesecontemporary.com
Sotheby's New York: 00 1 212 606 7000; www.sothebys.comReuse content