How to Choose an Art Appraiser

Whether you are a passionate art collector, an art enthusiast, or someone who just inherited a large collection, the only reliable way to find out the value of your art is through a professional appraisal. There’s a variety of reasons why you might want to appraise art (for donation, insurance, sale, estate, or just for satisfying their curiosity). But regardless of the reasons for appraising art, a certified art appraiser is the only one who can issue an appraisal opinion that substantiates the value of your art. If you are thinking about finding an art appraiser for your collection, here are a few things you should pay attention to in order to ensure you’ve made the right choice.

Types of Art Appraisals

There are several types of art appraisals. You should ask yourself why you are getting an evaluation in the first place. Are you really looking to sell? Are you trying to make sure your will is fair? Do you need insurance? 

Free Evaluation

Many art galleries, dealers, curators, and auction houses will give you a free estimate of value by comparing your art with similar pieces they previously saw, sold or are selling. This is the estimate artworks usually get when they are consigned for sale through an intermediary. It is simple, quick, and informal, which means that you cannot use it as a formal report of value for insurance, donation, and estate purposes. 

Insurance Appraisal

Unfortunately, art pieces can be damaged, broken, or stolen, which is why it can be important to insure your collection. Insurance companies will need a professional art appraisal to settle your claim. These appraisals are more detailed than simple value estimates, require more time, and have to be conducted by certified art appraisers, who will charge an hourly fee for their work. Most insurance companies will only accept certified appraisals made in compliance with The Uniform Standards of Professional Appraisal Practice (USPAP). 

Donation

A professional, USPAP-compliant up-to-date appraisal is also required by the IRS for determining tax breaks or refunds for every piece you’ve gifted as a charitable donation. The IRS has strict guidelines for appraisers, so make sure you pick an appraiser that meets these high standards. Also make sure to ask if the appraiser is comfortable doing a donation appraisal for the IRS. Due to the strict guidelines and review process that the IRS does for appraisals, some appraisers will refuse to do them. 

Estate

Inheriting an estate comes with a wide array of issues and additional costs. For starters, you’ll have to pay federal and state estate taxes. In order to do that, you’ll have to submit a USPAP-compliant professional estate appraisal to the IRS for Fair Market Value. And if you want to get rid of some items, it’s advisable to get an appraisal first, as it will prevent you from throwing valuable artworks in the trash. An art appraiser can also help evaluate the value of the estate for sale, and can even organize and sometimes run the estate sale on your behalf. Just be sure that the person doing the appraisal is not also buying the estate or item. If they say they want to buy they should also suggest you get a 3rd party appraisal. 

Equitable Distribution of Estate

A professional appraisal can facilitate the equitable distribution of an estate among multiple heirs in the case of a death. Divorces can also be smoothed with the help of an appraiser to weigh in on the fair market value of objects. Even if spouses and successors can’t agree on splitting the estate themselves, a well-appraised and cataloged list of artworks can be used by the court to ensure a fair division of personal property.  

What is USPAP and Why is it Important?

The Uniform Standards of Professional Appraisal Practice (USPAP) represents ethical and performance standards for the appraisal profession in the U.S.  Its goal is to ensure that the art appraiser is independent, impartial, and objective. Adopted by the Congress in 1989, it covers all types of appraisals, including art, and other personal property, business, real estate, and mass appraisals. The USPAP is updated every two years by the Appraisal Foundation. USPAP compliance is not mandatory for art appraisers; however, it is an important credential for several reasons. USPAP ensures that art will be evaluated in a competent manner, with proper methods and techniques, and that the appraised value will be fair and realistic. Additionally, The USPAP compliance is obligatory for appraisers in federal-related transactions and appraisals that the IRS requires for tax purposes.

Who can Write USPAP-compliant Reports?

USPAP-compliant appraisals are written by USPAP-compliant appraisers. In order to get their certification, appraisers have to take a 15-Hour long National USPAP Course (or its equivalent) and pass a rigorous test upon its completion. Since the USPAP is revised and updated every two years, appraisers have to take a 7-Hour National USPAP Update Course (or its equivalent) every two years to stay up to date with the changes.  If a person is offering an appraisal but does not know what USPAP is, perhaps you should shop around a bit more. 

How Much Does an Appraisal Cost?

The cost of an appraisal depends on the type of appraisal you need. As previously mentioned, quick estimates of value are free and are usually made as a part of a larger package of services. Many auction houses, for instance, offer free estimates of value for items listed on their auctions. On the other hand, specific, detailed USPAP-compliant reports will typically cost you $150 and up for a single item. Since most appraisers charge by the hour, the price will usually depend on the number of art pieces you have and the time needed for research for their appraisal. 

Should an Art Appraiser Charge Based on the Value of an Item?

Appraisers who charge a percentage of the artwork’s value should be avoided, since they might be tempted to overvalue your pieces, to get more money on percentage. Those who charge based on the number of items should be avoided as well, as they are known to skimp on the research. Choosing appraisers who charge by the hour will ensure that they are impartial, as they have nothing to gain by overvaluing or undervaluing a collection. Charging by the hour will also ensure that appraisers invest enough time in meticulous research, (instead of rushing an appraisal) as this will get them more money in the end. 

Anyone who suggests the price of the appraisal is dependent on the value of the object is basically a scam artist. 

What’s in a Good Appraisal Report?

Every art appraisal is based on research and comparison. This involves searching for provenance (history of ownership and exhibitions), authenticity, and comparing the item with similar pieces that were recently bought or currently up for sale. All this is then compiled into a detailed appraisal report. For starters, a good appraisal report should include a letter of transmittal, with the scope of the job and the use approach. 

Detailed descriptions of pieces with measurements and high-resolution images are added to help owners and other interested parties identify and better understand the artworks. Reasons for the appraisal, the type of value, condition of the objects, provenance, condition, and limiting factors and liabilities (that might affect the valuation) are also stated in the document. Finally, every appraisal should contain the appraiser’s resume, signature, statement of ethics, and a certificate of appraisals. The appraisal should be accompanied by documentation that provides credibility to the report.

How to Know if an Art Appraiser is Qualified for the Job? 

Not every art appraiser is fit to assess every art genre. An Old Masters appraiser, for example, may not be the best choice for assessing the value of Contemporary art. In order to find the right appraiser for your collection, explore the appraiser’s background, and see if he or she has educational specialization or a long history in appraising the type of art you collect. If you have already worked with galleries, dealers, auctioneers, and other art professionals you can ask them for a recommendation. Just bear in mind people who make their living buying and selling art are strongly incentivised to sell art and will generally suggest options that lead you down that path (not a problem if you were headed there anyway). 

The major professional organizations for appraisers are the American Society of Appraisers, International Society of Appraisers, and Appraisers Associations of America. Belonging to one of these organizations is a strong sign of credibility, since, in order to join these associations, art appraisers have to pass rigorous exams and peer reviews. More importantly, the professional organization vouches for their appraisers and can hold them accountable, if they break the professional standards and/or ethical practices. A database of appraisers in these organizations is available here.