Art vs Real Estate Valuations - The Difference is In the Data!
Automated valuation models (AVMs) are abundant in the real estate industry, and provide an accessible way for home buyers and sellers to gather market information that informs their decisions.
ARTBnk RTV is similar in that we give art enthusiasts access to information that, until now, has been accessible only to a few.
But there are immense differences between ARTBnk RTV and other AVMs, rooted in data. And data is the foundation for any valuation.
With real estate, getting accurate and sufficient data is fairly straightforward. There are standardized characteristics of homes and, importantly, a universal vocabulary to describe them. Square footage, number of bedrooms, and location are a few. There is also a government regulated MLS public database that lists this type of information alongside the sales history for nearly every home nationwide. Add on county-by-county assessment records, and you have a tremendous amount of (mostly) accurate data that is (relatively) easy to obtain from public sources.
The art world is the complete opposite.
To the extent that there are standardized characteristics for art (think artist name, medium, colors, to name a few), there is no agreed-upon vocabulary to express them. There is no place where all this information is housed together, and there certainly is no singular source of sales history with curated, normalized data.
That’s what ARTBnk has had to build before we could perform art valuations - a standardized database for all tradeable works of art.
It’s a huge task and we’ve been working on it for the last two years. It’s taken this long because, unlike those who have simply applied a mathematical formula to public data, art expertise is essential for developing the universal criteria necessary for accurate valuations.
Difficult? Yes. Doable? Absolutely.
And now that we’re partway through, our data is even more accurate and consistent than the public information used by other industries.
Check it out for yourself. Sign up for ARTBnk Beta.