The art world can be confusing. Even at the auction houses, which are the most transparent parts of the market, numbers are not always what they seem.Enter GAVEL (Generate Auction Valuation Extra Levy), a new tool to help sort out what's actually going on. GAVEL is, at heart, a simple conversion calculator. It's much like a currency converter, say, or a centigrade-to-fahrenheit converter. Except this tool converts auction hammer prices into real money, and back again.Imagine that you’re bidding on a piece at Sotheby’s in New York. The bidding is fast and furious: $5,000! $6,000! $7,000! You raise your paddle, make an $8,000 bid — and win. Congratulations! You’ve just bought the artwork for $8,000, right? Wrong. In fact, you’ve just bought the artwork for $10,000. Even though everybody in the room hears the auctioneer announce that the piece has “SOLD for $8,000″, once the auction is over, Sotheby’s will tack on a 25% “buyer’s premium,” which adds another $2,000 to the price.
So if you’re bidding at auction, keep GAVEL handy: it will tell you immediately how much you’re really bidding when you get caught up in the thrill of the chase. And when looking at how much other pieces have sold for, you can quickly figure out what the hammer price converts to. A big Warhol gets hammered down for $76 million? That’s $85.3 million in real money.
GAVEL works the other way, too. Let’s say a Sotheby’s press release is reporting that a painting by Jacob Ochtervelt sold for $4,421,000, above its estimate of $3-4 million. Just plug that sale price into GAVEL, and you'll discover that the painting was actually hammered down for $3.8 million: well within the estimate. Maybe that same release reports that a François Boucher fetched $2,405,000, right in the middle of its $2-3 million estimate: again, GAVEL will reveal that the hammer price was actually a flat $2 million, barely at the bottom of the range. (Auction house estimates are always for the hammer price, not the total price paid.)
GAVEL doesn't demystify everything about the art world - far from it. But it does help with basic arithmetic, allowing auction watchers to spend less time worrying about numbers, and more time thinking about art. Start playing around with it, and embed it on your site today.