Banksy Q3 Mini-report: rationalizing the price development
In 2020 we have seen a real rally in Banksy print prices. In this brief update I wanted to have a quick look at price development and answer a few common questions I have heard.
What do the numbers say?
Banksy print prices have performed well during 2020 with an overall increase of 104% in Banksy Price Index, implying on average doubling of print value. While the recent rally make most of us feel like the performance was totally immune to the pandemic this was not necessarily the case. During early 2020 there was a clear and pronounced "hesitation" in the market, as shown in the figure below, which has been indexed vs August 2019 price levels. The downside was minimal, which definitely has helped with the confidence in print pricing over the summer and contributed towards the rally over last months.
At the same time we have seen a significant volume of auctions. While the volumes and prices achieved at auction may feel high, they are fully in line with historical volumes and auction premiums vs Banksy Print Index.
During last 12 months there has been 314 Banksy prints sold at auction, while during previous period the number was 300. This is only a 5% increase, while same increase last year was >45%. Despite what it may feel like, we are not seeing much more prints flowing to auction. Average print price at auction has also increased from £23k to 42.5k£, which seems below the value increase of prints, but is likely justified by increased number of lower-end unsigned prints coming to auction. These trends are illustrated below (keep in mind that the data is mapped in periods from September to September to make it comparable to last 12 months).
Is the price increse unprecedented?
We have never seen a 50% month-on-month price increase in Banksy Print Index and we have also never seen a 100% increase year-on-year. However, there are a few situations that have come close:
>10% increases are fairly common month-on-month with strong performance on major auctions, last one being the 14% increase on Sotheby's Online in September 2019
>50% annual increases have also happened several times:
55% increase in 2017
60% increase from mid-2014 to mid-2015
45% increase from mid-2010 to mid-2011
Are there differences across prints?
There are indeed significant differences in performance across prints. Firstly, signed have clearly outperformed unsigned. The value increase in unsigned has been as far as 2x compared to signed prints. Historically there has never been such separation in value.
There has also been separation in performance of different print categories. I have split all prints into high-end and low-end to illustrate this. As high-end I have defined signed with value £>75k as of September and unsigned with value £>45k, while other prints fall into low-end. The resulting chart is interesting, as it shows that low-end unsigned have by far outperformed other print segments (e.g. prints like Flags, Napalm and Toxic Mary that were unwanted last year are now selling in £30k range), while for signed prints the high-end prints have performed better than low-end.
Are there undervalued prints?
It is hard to say, but there are a few prints where the signed-unsigned ratio seems to have skewed significantly due to abovementioned trends:
Gold Flag and Formica Flag prices will be definitely pushed up by Flag price results. Both have historically been fairly low-priced due to attractive pricing of basic Flag and must move up significantly now. Furthermore they are from a very small edition.
Grannies signed commands only approximately 50% premium over unsigned, which is much lower than typical signed premium. Same applies to Flying Copper, Jack and Jill and Happy Choppers.
Signed Laugh Now, Pulp Fiction and Barcode are likely to follow similar trajectory as LIITA, since none of them have been seen on market recently and unsigned are being pushed up in value following LIITA results.
Sale Ends v2 remains a highly attractive print, commanding a tiny (~30%) premium over unsigned and usually in excellent condition due to being a fairly recent print.
All-in-all it is exciting to see the development of the market in these unprecedented times. We can only speculate whether we will see a correction or not. While it is increasingly hard to keep price estimates on Banksy Value, I will always guarantee you the latest facts on auction results.
