Peter Vahlefeld: The Warhol Economy “Flipping” an asset loosely means buying and swiftly reselling it to make a quick profit. You can flip stocks, trading them within 24 hours. If you want to flip houses, you can buy them, fix them up, put them back on the market, and—if you’re lucky—get your TV-show. In the art world, however, flipping is a dirty word. “It’s disgusting,” said art adviser Lisa Schiff, noting how speculative buying practices can harm young artists’ careers. Speaking more subtly, Dr. Elizabeth Pergam, who teaches at Sotheby’s Institute of Art, noted that rapid run-ups in auction prices lead to a widely-held idea that flipping is “not healthy for the market.” Regardless of the data, art flipping carries a significant stigma in an industry that runs on relationships and reputations.

Most artworks, unlike stocks and houses, are made by working artists who rely on sales to support their creative practices. Artists often work with gallerists, who sell their artworks to institutions and collectors and give them a large portion of the proceeds. Such private exchanges are considered primary market sales. Once a collector decides to put an artwork up for auction, it enters the secondary market. Artists don’t benefit from any of these sales, except in the few jurisdictions with resale royalty laws; most of the money goes to the consignors and auction houses. Heather Bhandari, an independent curator and educator who previously worked as a director at the Chelsea gallery Mixed Greens (which closed in 2015), believes that the art world frowns upon flipping in part “because the buyer rarely does anything to help increase the value of the work—they profit from artists’ continued hard work without paying anything to the artists.” For Pergam, buying and selling a single work of art within 5 to 10 years is a rapid turnover, and constitutes flipping. Schiff prefers a you-know-it-when-you-see-it definition. “It’s always obvious,” she said. It happens when “this artist is too young to be at auction.” From Schiff’s perspective, a painting by Gerhard Richter. The latter artist is far more established, with roughly 30 and 50 additional years of artmaking to his name. He has had adequate time to develop his work, without facing the pressures of the art market. No one’s too concerned about flipping if the artist is well-established or dead—nobody is bothered on behalf of Andy Warhol.