The Art Market in Transition: Insights from Deloitte’s 2025 Report

The art market, a vibrant tapestry of creativity and commerce, is currently experiencing a notable slowdown that began in 2023. This trend is underscored by the recent Deloitte annual report titled “The Art and Collectibles Market 2025,” which highlights the myriad uncertainties stemming from socio-political tensions and macroeconomic challenges. As we look toward 2025, the report offers a comprehensive analysis of the art market, revealing how generational shifts and evolving buyer preferences are reshaping the landscape of art collecting.

Art Market in 2024: Global Turnover Down 26.2% from 2023

The year 2024 has seen a significant decline in global demand for collectibles, with an overall turnover decrease of 26.2% compared to 2023. This downturn is largely attributed to ongoing international tensions that have made collectors more cautious, leading to a reduced ability of auction houses to source high-quality works. While traditional categories like painting have suffered, collectible design has emerged as a bright spot, appealing to younger buyers with its accessibility and contemporary appeal.

Generational Shift: The Weight of New Gen Z and Millennial Buyers Grows

A pivotal theme in the Deloitte report is the generational shift occurring within the art market. Younger buyers, particularly from Gen Z and the Millennial demographic, are redefining market priorities. These new collectors tend to favor contemporary art and luxury goods, often operating with smaller budgets than their predecessors. In 2024, over 30% of new buyers at major auction houses belong to these younger age groups, indicating a significant shift in the collector profile. Meanwhile, older generations, especially Baby Boomers, continue to provide a steady supply of historically significant works, ensuring a blend of old and new in the market.

New York, London, and the Middle East: Geographical Dynamics

Geographically, the art market remains centered in the United States, with New York reaffirming its status as the sector’s hub due to robust local demand. Despite economic challenges in China, other Asian markets like South Korea, Taiwan, and Japan are emerging as cultural hotspots. In Europe, Paris is gaining ground on London, bolstered by favorable tax policies and strategic investments in the art sector. The Middle East is also witnessing significant growth, with Christie’s planning to open a branch in Riyadh in 2025, reflecting the region’s increasing wealth and interest in art.

US Market: Between Duties and Tax Benefits

The U.S. art market continues to lead in volume, driven by a new generation of Ultra High Net Worth (UHNW) collectors, many of whom are linked to the technology sector. These collectors are shifting their focus from historicized works to contemporary art and luxury collectibles, indicating a departure from traditional trends. The potential for new duties and tax benefits under changing political climates, such as those associated with “Trumpnomics,” could further influence market dynamics, potentially leading to a recovery in performance.

Artificial Intelligence: A New Player in the Art Market

The integration of artificial intelligence into the art market has reached new heights in 2024, exemplified by the sale of a painting created by the humanoid robot Ai-Da for $1.1 million at Sotheby’s. This sale marks a significant moment in the art world, as it represents the first major auction of a work produced by an algorithm. While AI serves as a powerful tool for market analysis, it also raises questions about the potential standardization of artistic production, challenging traditional notions of creativity.

Painting: Turnover Decline of -25.6%

The global painting market, which constitutes approximately 70% of the collectibles market, has continued its decline, with a turnover decrease of 25.6% in 2024. Factors such as geopolitical uncertainties and a higher unsold rate at auctions have contributed to this downturn. The average hammer price for paintings has also dropped significantly, reflecting a cautious attitude among collectors and the challenges faced by auction houses in presenting quality lots.

Top Lot 2024: “L’empire des lumières” by Magritte

Despite the overall decline in the market, notable sales have occurred, with René Magritte’s “L’empire des lumières” (1954) selling for $121.2 million at Christie’s in New York, setting a new record for the artist. This sale underscores the ongoing demand for high-quality works, even amid a cautious market environment.

Passion Assets: A Downturn

The market for Passion Assets, which includes jewelry, watches, antiques, and design, has also faced challenges in 2024. The number of million-dollar auctions in this sector decreased, contributing to an overall turnover decline of 22.3%. However, certain segments, such as sports memorabilia, have seen remarkable growth, attracting younger buyers and achieving record sales.

Collectible Wines and Spirits: A Mixed Bag

Interest in collectible wines and spirits has also been affected by the market downturn, with a decrease in million-dollar auctions and overall turnover. Nonetheless, regional variations indicate emerging opportunities, particularly in stable markets like Italy, while dynamic regions like Burgundy have experienced contractions.

Watches and Jewelry: A Sector in Transition

The jewelry and watch market has witnessed significant developments over the past few years, but the complexities of 2024 have led to a decline in enthusiasm. Luxury brands are now tasked with redefining their strategies to balance tradition and modernity. Despite this, the sector remains strong, with a notable decrease in the average unsold rate, indicating a positive trend for high-value lots.

The Photography Market: A Niche Arena

The photography market continues to be a niche segment, with many collectors preferring to buy directly from galleries. The sector has seen a decline in million-dollar auctions, but a reduction in the average unsold rate suggests that auction houses are successfully curating high-quality lots.

Antiques Market: Timeless Charm

In contrast to the broader art market, the antiques sector has shown resilience, with a turnover increase of 7.5% compared to 2023. This growth is attributed to the enduring appeal of antiques, which continue to attract collectors worldwide.

Furniture and Design: A Collector’s Favorite

Design items have become increasingly popular among collectors, with European and Italian designs leading the way. The Arredi&Design Index has shown remarkable recovery, indicating a strong demand for limited series and prototypes, further solidifying the role of design in the art market.

Conclusion: A Market in Transformation

The art market is currently navigating a complex landscape shaped by economic, technological, and generational factors. While the slowdown in performance presents challenges, it also signals a transformative phase driven by younger collectors and evolving tastes. As the market adapts to these changes, it will be fascinating to observe how the interplay of tradition and innovation continues to shape the future of art collecting.