In May, Andrew Lloyd Webber paid $29.15m (pounds 18.4m) for a portrait from Picasso's blue period, setting a new five-year record for any worldwide picture sale. To show that was not simply a flash in the pan, this week both the two main international auction houses, Christie's and Sotheby's, had their best sales of the past five years, grossing a total of pounds 55.2m between them.
The figures, large by any standards, still pale by comparison with the peak hit in May 1990 when a Van Gogh - Portrait of Doctor Gachet - sold at Christie's for $82.5m. That record still remains unbroken, although Sotheby's nearly matched it with a Renoir auctioned in the same month for $78.1m.
For several years after the market crashed dramatically in the sales of November 1990, sellers held back and buyers remained frightened off by the experience of the previous decade. But confidence is clearly returning to the market.
Art Sales Index, which monitors auction turnover, says that even before this week's news, UK sales of pounds 163m since last August are already nearly 12 per cent up on the same period of the previous year. Worldwide, sales are 5 per cent ahead at pounds 745m over the same period.
Melanie Clore, head of impressionist and modern art at Sotheby's, says the current market is much healthier and more discriminating than it was.
The key to this is that demand is being driven by genuine long-term collectors and reputable dealers. With the benefit of hindsight, the destabilisation of the market in the 1980s is now being blamed on speculators and institutions looking for short-term investment gains.
Such buyers appear to be absent from the current resurgence, although economic factors are not entirely absent from the equation. The fall in the pound and the dollar against other world currencies this year has made both London and New York, the two main centres of fine art auctions, highly competitive to big buyers in Europe and the Far East.
But the auction houses are also having to work harder for their money. Estimates on pictures are being pitched at more realistic levels and even then, the best prices depend on strict criteria, which boil down to quality, condition and "freshness to the market".
The Gauguin sold at Sotheby's last week for pounds 5.5m, for instance, was previously in the same collection for 60 years. This means that pictures which have been sold recently are unlikely to fetch premium prices.
There is, as yet, little sign of any trickle-down effect on the rest of the market from the recent strength in these salerooms, but over the years, carefully selected works of art have retained their value at least as well as equities. It now looks a good time to buy again.Reuse content