LONDON (Reuters) - A Giacometti statue smashed the art auction record late on Wednesday, fetching $104.3 million after just eight minutes of intense bidding at Sotheby's, and experts predict there may be even higher numbers to come.
"You only need two individuals to take something to $104 million or more," said Philip Hoffman, founder of the Fine Art Fund Group which has more than a dozen billionaire clients.
"I am confident we will break $104 million in the next couple of years," he told Reuters.
Whatever happens to the broader economy, there will always be super-wealthy individuals who look at the art world either as a passionate collector or a shrewd investor or both.
There are institutions, some with state backing, in the market for rare works to fill museums and galleries that have sprouted up, particularly in the Middle East. And while Russian buying may have slowed, China and India have made up for it.
Not that the art market has been immune to the global economic chill of the last two years.
Christie's, the world's biggest auctioneer in 2009, saw its sales fall by over a third from 2008 in dollar terms, as nervous owners kept hold of their prized possessions and buyers became more choosy about what they purchased.
But by the end of the year confidence had quickly returned.
In December Christie's sold the most expensive lot of the year, a Raphael which fetched $47.9 million, a record for any work on paper.
And now Sotheby's has the overall record of $104.3 million for Giacometti's stick-thin statue "L'homme qui marche I" (Walking Man I), just beating the previous top auction lot of $104.2 million for a Picasso painting set in New York in 2004.
Private sales have generated significantly higher amounts.
What the recent trend is likely to do is free up supply of "blue chip" art, experts said.
"What people tend to forget is that supply is the crucial thing in the market," said Georgina Adam, editor-at-large of The Art Newspaper.
"I think what this demonstrates is that, first: great works of art will make huge prices, and second: this will loosen up supply."
She and Hoffman saw greater investment in art over the coming months as a hedge against inflation and as an alternative source of earnings in uncertain economic times.
"Many clients burned their fingers in other asset classes, and would quite like to buy into tangible assets and so have put money into things like gold, diamonds and art," Hoffman said.
He added that his fund had put more money into art in the last month than at any time in the last eight years, pointing to short- to medium-term strength.
While confidence is high for the so-called "masterpiece market" that includes rare works by established masters like Giacometti, Raphael and Picasso, the contemporary sector may take longer to recover its pre-crisis swagger.
What happens to the rest of the market is less clear, with the risk of a disconnect between "the best and the rest."
"If you have got something good, you will still get a really good price for it," said Clare McAndrew, an economist and editor of the recently released book "Fine Art and High Finance."
"But if you have got something mediocre, the middle of the market is being really squeezed and you shouldn't be selling."
Additional reporting by Michelle Nichols in New York, editing by Paul Casciato