There should be little surprise amid ongoing wars and trade disputes that geopolitical and economic instability ranks as the number one concern for the art trade, as per the latest edition of Art Basel and UBS's Art Market Report, released Thursday (12 March). The 2025 edition of the benchmark survey of art dealerships and auction houses paints a picture of an industry slowly adapting to mounting uncertainty and operational costs.
Global art sales grew modestly in 2025 after two consecutive years of decline, rising by 4% to an estimated $59.6bn, the report finds. This uptick was largely driven by high-end sales, with a 9% increase in the combined value of auction turnover above $10m, a category that had nosedived in 2023 after geopolitical turbulence dissuaded many collectors from consigning top works. Nonetheless, the global art market is still well shy of the $67.8bn it totalled in 2023, as well as its all-time peak of $68.2bn in 2014.
“People are perhaps becoming desensitised, especially if the wider situation shows no signs of improvement,” says Clare McAndrew, the report’s author, of the market’s slow recovery. Big-ticket transactions last year included Klimt’s Portrait of Elisabeth Lederer (1916), which sold for $236m, the second-highest price ever achieved by a work at auction.
Compared to the auction houses, gains by dealers were more measured, with gallery sales rising on average by 2% year-on-year to an estimated $34.8bn, accounting for 58% of the total market. At the very highest end, galleries with an annual turnover of more than $10m reported a 3% increase. The rebound was more pronounced in the lower tiers: dealers with a turnover of between $250,000 to $500,000 a year enjoyed a 25% average boost in sales.
Squeezed middle
These wins will come as little relief to many businesses, however, as profit margins continue to shrink. A higher share of respondents cited operating costs as a key concern compared to last year. The report finds that total operating costs rose by an estimated 5% on average, “above the rate of inflation in most major markets and above aggregate sales growth”, McAndrew writes. Attesting to a middle market squeeze, dealers with turnovers of $250,000 to $500,000, and of $500,000 to $1m, reported lower profitability than last year, while dealers with both lower and higher turnovers reported increased profitability.
The US tariffs enacted by the Trump administration did little to help: 56% of dealers said that tariffs had a negative impact on business, while 72% identified higher ancillary costs as the biggest knock-on effect. “Although much of fine art was exempt from the tariffs, shipping delays, increased logistical costs and reduced consumer confidence all discourage people from going through the hassle of cross-border transacting, which the art market is heavily reliant on,” McAndrew says.
Shopping local
Complications with cross-border trade have led many collectors to acquire more in their home markets, with all dealer segments in 2025 reporting a greater share of local buyers. This was particularly pronounced among the smallest dealers whose share of local buyers rose by 9% to 71% of sales to private collectors.
This domestic focus impacted markets differently, depending on how reliant they are on overseas trade. This is demonstrated in China: Hong Kong, a freeport with a more international profile, saw aggregate sales decline by 6% year-on-year, while the more domestically focused mainland saw a 5% rise.
Overall China’s market share decreased by 1% to 14%, and it maintained its position as the world’s third-largest art market, behind the US, which accounts for 44% (up by 1%) and the UK, which accounts for 18% (no change).
Promisingly, women artists have now reached gender parity for representation at galleries operating exclusively in the primary market. And for dealers working in both the primary and secondary markets, the share of women artists represented grew by 4% in 2025 to 45%, its highest level to date.
