The year 2008 will forever stand as a stark dividing line in the history of antique collecting. There was the time before 2008, when many categories of collectibles were still relatively vibrant and active. And then there is the time after 2008, when many traditional collectibles markets – china, glass, furniture, etc. – collapsed in price.
What is the one key element that divides these two disparate time periods? The answer is the Great Recession of 2008-2009. This seminal event has reverberated throughout the antique collecting and investment market like an earthquake, right up to the present day.
The primary reason the Great Recession has had such a massive impact on antique collecting is pretty straightforward. The economic fallout from the recession was absolutely massive. In 2007, the real (inflation-adjusted) median household income in the U.S. was $58,149. A full eight years later, in 2015, the same number stood $919 lower at $57,230. A contraction in U.S. real household income was formerly unprecedented among post World War II recessions.
This declining discretionary income has had a direct impact on the ability of average people to collect antiques. The marginal antique buyer has fled the marketplace and this is reflected in the pricing for most collectibles. Prices for categories such as Depression glass, sports memorabilia, Waterford crystal, Victorian furniture and primitives, among others, have declined relentlessly since the Great Recession tore into the soft underbelly of the Western middle class.
I have a personal story that illustrates this fundamental change in the antique market. In 2008, my beloved grandmother, aged 95, passed away. She had been an avid collector of antiques and collectibles all her life, although she never paid much for any item. After family members chose the antiques from her estate that they wanted, the remainder was put up for sale at a local auction house.
My family had always believed that her extensive antique collection was worth a significant sum of money – perhaps tens of thousands of dollars. But reality, along with the concurrent Great Recession, shattered those misguided hopes.
Before I continue with the story, let’s review an important tidbit about the small auction scene. Every small-time auctioneer is trying to reach a minimum bid of at least $100 for every lot he sells. It simply isn’t worth the time to conduct bidding on lone items that end up selling for only $10, $25 or $40. So nearly all auctioneers combine lower value, single items into larger, multiple item groupings in order to increase each lot price.
Many of my grandmother’s collectibles were of much lower monetary value than originally thought. Consequently, most items from her estate were combined into multi-item lots by the auctioneer. This phenomenon is actually a very important sign of a declining collectible market niche. Many antiques that used to sell at auction as single items before 2008, now can only reach that magical $100 price point when they are sold in groups.
In the end, the collectibles portion of my grandmother’s estate realized less than $10,000 at auction. This was partly due to the effects of the Great Recession. Had her estate come to auction a couple years before, in 2006, the realized prices might have been 50% more, and perhaps even higher. Once again, antique collecting clearly bifurcates into the time before the Great Recession and the period after it.
Now I don’t want to blame the decline of traditional antique collecting solely on the Great Recession. There were other, powerful demographic and lifestyle trends gradually unfolding in the background at the same time. But the financial damage caused by the Great Recession was the single largest contributor to the demise of antique collecting as it had existed since the mid 20th century.
And, so far, there are no signs that we are ever going back to the collectibles market that used to be. So, if you are interested in collecting, stick to investment grade antiques that have a high probability of appreciating in the future.
